Reviewing Delegation: an Analysis of the Congressional Reauthorization Process : An Analysis of the Congressional Reauthorization Process 9780313057342, 9780275978525

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Reviewing Delegation An Analysis of the Congressional Reauthorization Process JAMES H. COX

Library of Congress Cataloging-in-Publication Data Cox, James H., 1963– Reviewing delegation : an analysis of the congressional reauthorization process / James H. Cox. p. cm. Includes bibliographical references and index. ISBN 0-275-97852-4 (alk. paper) 1. United States. Congress. 2. Legislative oversight—United States. 3. Delegation of powers—United States. 4. Bureaucracy—United States. 5. Administrative agencies—United States—Decision making. I. Title. JK585.C69 2004 328.73⬘07456—dc22 2003058156 British Library Cataloguing in Publication Data is available. Copyright 䉷 2004 by James H. Cox All rights reserved. No portion of this book may be reproduced, by any process or technique, without the express written consent of the publisher. Library of Congress Catalog Card Number: 2003058156 ISBN: 0–275–97852–4 First published in 2004 Praeger Publishers, 88 Post Road West, Westport, CT 06881 An imprint of Greenwood Publishing Group, Inc. www.praeger.com Printed in the United States of America

The paper used in this book complies with the Permanent Paper Standard issued by the National Information Standards Organization (Z39.48–1984). 10

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To my parents

Contents

Illustrations

ix

Preface

xi

Abbreviations

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1

Understanding Congressional Control of the Bureaucracy

1

2

Four Models of Agenda Control

11

3

Toward a Tradeoff Explanation of Control

25

4

The Authorization Process

43

5

Case Studies of the Choice to Use Temporary Authorization

61

6

Comparing the Success of Passing Reauthorization Legislation across Agencies

83

7

A Quantitative Assessment of Transaction Cost Theory

105

8

Conclusion

123

Appendix: List of Federal Agencies Analyzed in Chapter 4

131

References

143

Index

155

Illustrations

FIGURES 2.1

Strategic Implementation by an Agency

18

3.1

Strategic Implementation by an Agency When the President Is an Advocate

41

Strategic Implementation by an Agency When the President Is Not an Advocate

42

Number of Agencies Unauthorized 1976–2002

87

3.2 6.1

TABLES 2.1 4.1 5.1 5.2 6.1

Four Types of Models of Control and Their Predictions for the Use of Review

12

Trends in Use of Temporary Authorization for Federal Agencies

56

Four Categories of Agencies by Age and Authorization Status

62

Agencies That Congress Changed from Permanent to Temporary Authorization

64

Selected Agencies and the Success Congress Has Had Passing Their Reauthorization Legislation

84

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6.2 7.1 7.2 7.3 7.4 7.5 7.6

7.7

7.8

Illustrations

Selected Agencies and the Years They Were Not Authorized

86

The Operationalization and Expected Direction of Variables Affecting the Choice to Use Temporary Authorization

108

Various Measures of Conflict for Committees in the House of Representatives

112

Authorization Laws with the Fewest Number of Subject Headings in the 100th and 101st Congresses

114

Authorization Laws with the Highest Number of Subject Headings in the 100th and 101st Congresses

115

Logit Estimates of Authorization Status for Authorization Laws Passed in the 100th and 101st Congresses

116

Logit Estimates of Authorization Status for Authorization Laws Referred to a Single Committee in the 100th and 101st Congresses

117

Regression Estimates of Length of Authorization for Authorization Laws Passed in the 100th and 101st Congresses

118

Probabilities That a Law Requires Temporary Authorization for Varying Levels of Conflict and Complexity for Laws Referred to Only One Committee

119

Preface

The main goal of this book is to understand how Congress designs procedures as a way to control public policy. In many cases, Congress has little choice but to delegate authority to the bureaucracy. A rich literature has developed in recent years examining the ways in which Congress manages delegated authority. What is distinctive about this book is that I focus on one procedure, congressional reauthorization, which allows for review of policy. Congress may try to tie the hands of bureaucratic agencies and limit their discretion as a way of keeping control, but this is an imperfect tool. Members of Congress also have the ability to delegate and then to revisit the policy after they have seen whether it is working as they intended. Requiring reauthorization is one way for Congress to revisit a previous policy choice. As I show in this book, however, requiring review of policy is not without costs. Congress has expanded the number of agencies and programs requiring reauthorization over the last 50 years. This expansion was motivated primarily by the desire of authorization committees to exercise control over the agencies under their jurisdiction. Congress’s enthusiasm for temporary authorization hit its peak in the 1970s right when the process began to become more difficult to use. Authorization committees had a harder time controlling their bills when they came to the floor, and fewer reauthorization laws were passed. The result has been that a large chunk of the federal budget remains unauthorized from year to year. In this book I argue that members of Congress face a tradeoff in trying to control power delegated to the bureaucracy. If they require the renewal of policy, then they increase their capacity to manage policy implemen-

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tation. However, this increased capacity comes with the burden of maintaining support for the policy within Congress over time. Not only is review costly, it is also risky. The original enacting coalition gives its opponents a good opportunity to reshape the policy according to their own preferences. I provide evidence in the rest of the book that these costs and risks are very real. The book is divided into eight chapters. In Chapter 1, I review how previous scholars have looked at congressional oversight from both normative and empirical perspectives. I also introduce the tradeoff argument in more detail. In Chapters 2 and 3, I explain how previous research helps us to understand how members of Congress deal with tradeoffs. In Chapter 2, I review the economic organization literature addressing control of policy and assess its utility as a foundation for a better specified theory. Much of this literature cannot adequately account for tradeoffs. The main problem with studies in this literature is that they view control problems separately when solutions to those problems interconnect. If members of Congress face tradeoffs, then models that examine each control problem separately miss half the decision-making calculation. In Chapter 3, I use transaction cost theory to build an explanation for how members of Congress deal with control tradeoffs and, to make predictions for when they will require reauthorization. My model incorporates transaction costs at both the coalition-building stage and implementation stage of the legislative process. Specifically, I argue that procedures are chosen as a way to reduce the total enforcement costs of controlling outcomes. Conflict and uncertainty are the two main characteristics of legislation that contribute to transaction costs, and the amount of conflict and uncertainty in legislation affects the types of procedures used by Congress. The second step is to test these predictions. In Chapter 4, I show how a procedure called temporary authorization epitomizes the tradeoff between bureaucratic drift and coalitional drift. Temporary authorization is a procedure in which Congress makes a commitment to review the performance of agencies or programs in the future. This procedure provides Congress with one of its best opportunities to conduct oversight of the bureaucracy. However, temporary authorization also has costs and increases the risk of bureaucratic drift. This procedure provides an example of theoretical tradeoffs. I then examine Congress’s choice to use temporary authorization to assess hypotheses derived from my model. I do this in three ways. First, in Chapter 5, I examine agencies that moved from permanent to temporary authorization to explain the reasons that Congress changed their status. Since Congress changed each agency from permanent to temporary authorization, we would expect that some stimulus prompted this change. I also examine the creation of the Occupational Safety and Health Ad-

Preface

xiii

ministration (OSHA) and the Occupational Safety and Health Review Commission (OSHRC) as counterexamples of agencies for which Congress gave permanent authorization when they were created. Second, in Chapter 6, I look at the legislative reauthorization history of each of the agencies examined in Chapter 5. My argument rests on the assertion that committees anticipate their success in passing reauthorization legislation based upon the characteristics of the legislation. I compare success in passing this legislation both across agencies and over time to see if there is a relationship between these characteristics and success. In Chapter 7, I code all authorization legislation from the 100th and 101st Congresses as temporary or permanent. Using logistic regression, I test the hypotheses developed in Chapter 3. I conclude the book with a review and discussion of findings and the implications for understanding congressional control of policy. I also discuss the questions raised by these findings for current theories of congressional organization and suggest future research to address these issues. This book grew out of my dissertation project from the University of North Carolina, Chapel Hill. I am indebted to many people who helped me develop my ideas and complete this project. Michael Munger, Terry Sullivan, Bill Keech, and George Rabinowitz read many early drafts of my chapters and provided constructive comments. Scott Ainsworth provided valuable comments on a later draft of the work. I would especially like to thank David Lowery who was helpful to me from the beginning of this project. His feedback and encouragement made it possible for me to finish. Several people provided useful suggestions on the project at conferences and presentations. Michael Hermann at Greenwood Publishing Group and the team at Impressions Book and Journal Services provided guidance and assistance in editing and constructing the book. I am in their debt. Carolyn Wiggin read through the entire manuscript and provided invaluable help. She has also been an incredibly kind and supportive partner, and I do not know how I could have finished without her love and encouragement. Finally, I want to dedicate this book to my parents who have been nothing but supportive throughout my life. James Cox Sacramento, California

Abbreviations

AEC

Atomic Energy Commission

ATP

Advanced Technology Program

BLM

Bureau of Land Management

BRB

Benefits Review Board

CIA

Central Intelligence Agency

CIS

Congressional Information Service

DOL

Department of Labor

ECA

Economic Cooperation Agency

EOP

Executive Office of the President

EPA

Environmental Protection Agency

FBI

Federal Bureau of Investigation

FMHRC

Federal Mine Safety and Health Review Commission

FTC

Federal Trade Commission

GAO

General Accounting Office

ITC

International Trade Commission

JCAE

Joint Committee on Atomic Energy

NASA

National Aeronautics and Space Administration

NBS

National Bureau of Standards

xvi

Abbreviations

NIST

National Institute of Standards and Technology

NSF

National Science Foundation

OMB

Office of Management and Budget

OSHA

Occupational Safety and Health Administration

OSHRC

Occupational Safety and Health Review Commission

PLLRC

Public Land Law Review Commission

SEC

Securities and Exchange Commission

USIA

United States Information Agency

CHAPTER 1

Understanding Congressional Control of the Bureaucracy

As the American government has grown and become more complex, elected representatives have found it necessary to delegate authority to the bureaucracy. This growth in the bureaucratic state has spurred normative debates about the desirable degree of autonomy the bureaucracy should exercise. Some argue that democratic institutions cannot reliably deal with technical policy issues, and that these technical decisions should be left to experts (Aberbach and Rockman 1988; Friedrich 1940; White 1945, 1954). Others argue that delegation and over-reliance on the bureaucracy pose a serious threat to the integrity of a democratic system (Finer 1941; Lowi 1979; Robinson 1991). An academic’s take on these issues often differs according to his or her field of study (Moe 1985). Traditionally, scholars from the public administration school argue that government operates best through a separation of politics and administration. They typically argue that administrative decisions should be made on technical merit by experts, and politics should be left out of these decisions. From the public administration perspective, politics brings irrationalities and self-interest to decision-making. Conversely, political scientists are more likely to see participation by democratic institutions in administrative decision-making as desirable. Advocates of this more democratic perspective argue that all decisions have political impacts, and that a separation between politics and administration is, at best, difficult. They believe that administrative decisions cannot be separated from values and self-interest, and, therefore, democratic institutions are the most legitimate forum to make these decisions.

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In this debate between bureaucracy and democracy, the role of Congress is especially important. The decentralized nature of Congress allows it to represent a myriad of interests, which is seen as both a weakness and strength. Proponents of bureaucratic independence see decentralization leading to meddling by members of Congress, and thereby inserting irrationalities, politics, and parochialism into technical decisions. For these same reasons, however, proponents of popular control are likely to see congressional control of the bureaucracy as necessary. Because Congress represents and articulates a variety of interests, congressional influence will likely lead to more democratic outcomes. To assess our current situation by either one of these normative standards (bureaucratic autonomy versus political control), we must know to what extent Congress actually controls the bureaucracy. Are administrative decisions usually made according to congressional preferences, or do bureaucratic actors exercise a large degree of autonomy? Although thinking about political control over the bureaucracy has evolved, there is still disagreement about the degree of control that exists. Over the past 30 years, three different views of congressional control of the bureaucracy have been articulated. The first perspective, which Kiewiet and McCubbins (1991) call the abdication view, sees the bureaucracy exercising power largely independent of Congress (Dodd and Schott 1979). Proponents of the abdication view have cited the dearth of oversight done by Congress as evidence for their argument. A second view, called congressional dominance theory, emerged as a reaction to the abdication argument. Proponents of congressional dominance argue that Congress does not engage in oversight because the bureaucracy is controlled by Congress through institutional design. In fact, they argue that a lack of oversight activity actually provides evidence for congressional control. A third perspective, which I will call the tradeoff view, has taken a middle ground between abdication and dominance. The tradeoff view has a common theoretical lineage with congressional dominance theory. Both see institutional and procedural design as an important part of controlling the bureaucracy, but proponents of the tradeoff view take a broader view of control. The multi-institutional set up of American government makes perfect control impossible. Therefore, members of Congress must weigh control of bureaucratic implementation with their ability to control outcomes in other institutional settings. In this chapter, I discuss these three views in more detail, and the problems that each possesses. Additionally, I discuss why I see the tradeoff view as the best way to understand congressional control of the bureaucracy. I also outline how my study will build on the tradeoff view to better understand the relationship between Congress and the bureaucracy.

Understanding Congressional Control of the Bureaucracy

3

TH REE M ODE L S OF C O NGR E S S I O N A L C O N T R O L OF THE B U R E A U C R A C Y Abdication View of Congressional Control of the Bureaucracy All three views examine congressional control of the bureaucracy, but they look for control in different places. The choice of what evidence to examine stems from the theories employed by each. Scholars who came of age during the behavioral revolution naturally looked at congressional behavior to assess the question. The most logical behavior to study was oversight activity because it is most closely associated with control of the bureaucracy and it is observable and measurable (Ogul and Rockman 1990). The oversight activities studied have included committee hearings, legislative vetoes, casework, and committee reports (Aberbach 1979, 1990; Johannes 1979; Kaiser 1977; Lees 1977; Schick 1983). In addition, some scholars have used interviews of members and their staffs to measure attitudes and behavior (Aberbach 1990; Ogul 1976). The independent variables used to explain oversight activity included differences across committees (Lees 1977; Ogul 1976), personal motivations of committee members (Ogul 1976), and the changes in the institutional structure of Congress (Aberbach 1990). These studies were successful in explaining when and how oversight activity takes place, but they were less successful in explaining the impact oversight has on bureaucratic behavior (Ogul and Rockman 1990; Rockman 1985). Even though the evidence was not direct, some authors still drew conclusions about the degree of congressional control. The general consensus among these scholars was that the level and type of oversight activity was insufficient to control the bureaucracy (Dodd and Schott 1979; Ogul 1976; Scher 1963). There are a few problems with this conclusion. First, these studies implicitly assumed that for Congress to control the bureaucracy, members of Congress must engage in thorough coordinated oversight activity. If this assumption holds, then the conclusion that Congress does not control the bureaucracy seems reasonable given evidence that Congress does not engage in comprehensive oversight. However, if congressional control takes place through mechanisms that require little overt congressional activity, then studying congressional behavior will not help us understand congressional control of the bureaucracy in many circumstances. Second, other evidence suggests that congressional oversight is more common than previously thought and has increased over time (Aberbach 1990). Finally, a theory of behavioral control should explain when oversight behav-

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ior takes place and how it affects bureaucratic behavior. Unfortunately, we have little idea of what kind of behavior, how much behavior, or whose behavior is likely to lead to changes in behavior by the bureaucracy. Developing a research agenda to answer these questions would require a theoretical framework that connects behavior to outcomes, and, as presently developed, the behavioral approach has no such theoretical framework. Congressional Dominance Theory Congressional dominance theory emerged in the 1980s largely as a reaction to the abdication view. Advocates of congressional dominance theory do not disagree that members of Congress engage in little oversight, but they argue that control takes place despite this lack of activity. Congressional dominance theory advocates argue that members of Congress design institutions that guide bureaucratic behavior in a desired direction. If Congress designs institutions properly, then the institutions restrict the bureaucracy’s behavior with little need for congressional intervention. Accordingly, congressional dominance theorists study institutional arrangements and how they lead to control of outcomes. The theoretical framework that informed much of this work comes from principal-agent theory, which economists developed to understand economic organizations (Moe 1984). In principal-agent theory, a principal delegates authority to an agent for efficiency gains, but has to worry about losses from the agent during implementation (Mitnick 1980; Pratt and Zeckhauser 1985). Ensuring that the agent acts in a way consistent with the principal’s preferences entails costs. Therefore, the principal devises procedures and rules that will ensure that the agent gives the greatest possible return to the principal at the lowest possible cost of monitoring and enforcement. From this perspective, Congress delegates authority to the bureaucracy, and then develops mechanisms to facilitate monitoring and enforcement at the lowest possible cost. Members of Congress lower the costs of monitoring bureaucratic behavior by providing incentives for others to do it for them. McCubbins and Schwartz (1984) argued that Congress does not engage in “police patrol oversight,” in which members actively seek out bureaucratic transgressions. Instead, they devise procedures, such as the Administrative Procedures Act, which moves most of the cost of monitoring to private groups. For example, most new administrative rules must be published in the Federal Register before they go into effect. This allows groups to inform Congress of rules that they do not like. Other procedures such as administrative hearings, reports, impact statements, and waiting periods may all help to inform Congress as new issues emerge. These procedures act like fire alarms, causing Congress to react to constituency complaints (McCubbins and Schwartz 1984).

Understanding Congressional Control of the Bureaucracy

5

Once the fire alarm has been set off, Congress has the tools of appointment, authorization, and appropriations at their disposal to force bureaucratic compliance (Calvert, McCubbins, and Weingast 1989; McCubbins and Schwartz 1984; Weingast 1984; Weingast and Moran 1983). Congress can use these powers to reward and sanction agencies, and bureaucrats wishing to avoid the wrath of Congress will consider congressional preferences in their implementation of policy. According to Weingast (1984), bureaucrats will avoid conflict with members of Congress because Congress holds a “big club behind the door.” Congressional dominance theorists often cite the Federal Trade Commission (FTC) as an example of an agency that went too far in challenging Congress and paid a heavy price (Weingast and Moran 1983). However, we would not expect these confrontations to take place often because bureaucrats will not enter fights they cannot win. The result, according to congressional dominance theorists, is that Congress exercises control over the bureaucracy with little or no overt action. Not everyone agreed with this conclusion. The strong assertions of the congressional dominance literature were sharply criticized even within the institutional literature. According to Moe (1987), these weapons (the tools of appointment, authorization, and appropriations) will not force an agent to act in the principal’s interest in all situations because the threat of using these weapons is not always credible. Indeed, sanctioning an agency usually means passing new legislation, and this requires agreement among the House, the Senate, and the president. Typically, this agreement will be hard to come by. Moe (1987) also argued that sanctions work better when Congress tries to stop an agency from acting rather than forcing it to take action. In some situations, sanctions may actually make congressional policy preferences harder to achieve. For example, the Environmental Protection Agency (EPA) did not enforce environmental laws as strongly as Congress wanted during Reagan’s presidency. Cutting the EPA’s budget, however, would probably not have improved the enforcement of environmental laws. The big club behind the door argument appears insufficient to support a conclusion that Congress dominates the bureaucracy. In fact, even some original congressional dominance proponents backed off from their original formulation of the argument. For example, McCubbins, Noll, and Weingast (1987, 1989) recognized that traditional methods of control entail large costs to members of Congress. They also showed how an agent can change the status quo of the policy during implementation in such a way that makes it impossible for the original coalition to sanction agents that are not compliant (McCubbins, Noll, and Weingast 1989). From this perspective, the inefficiency of sanctions, or the inherent difficulties in the use of the club, lead members to employ administrative procedures to control bureaucratic behavior (McCubbins 1985; McCubbins, Noll, and

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Weingast 1987, 1989). Administrative procedures have the advantage that members do not have to agree on policy outcomes, or even know what outcomes they want from the bureaucracy at the time legislation passes. Instead, Congress develops procedures advantageous to important interest groups, and these procedures control the general outcome without Congress having to specify that outcome. For example, Congress can force agencies to use cost-benefit analysis or environmental impact statements in their decision-making, which will benefit some groups over others. In a response to McCubbins, Noll, and Weingast’s reinterpretation, Robinson (1989) argued that their new argument does not support the dominance conclusion either. First, he pointed out that if an enacting coalition could have enough foresight to see the impacts that administrative procedures would have on bureaucracy, then they would simply write more specific legislation to achieve the same result. Second, he argued that McCubbins, Noll, and Weingast provide insufficient evidence to support their argument. According to Robinson, not enough differences in rules and procedures exist across agencies to argue that Congress uses these mechanisms to ensure different outcomes. Without some systematic test across agencies, no evidence exists that Congress uses procedures in this way. Mashaw (1997) also makes the point that most procedures created by Congress are very general and apply across most agencies. Therefore, although the administrative procedures argument saves the congressional dominance perspective from Moe’s critique, little evidence exists to support it. The Tradeoff Model of Institutional Choice Many scholars have found that neither the abdication view nor the congressional dominance view is completely satisfactory. The behavioral approach looks at only one type of control, and is not well integrated into a theory linking behavior to control. This approach allows us only to observe and report when members of Congress engage in oversight. Additionally, opponents of the abdication conclusion argue persuasively that congressional control may take place without overt oversight activity. Congressional dominance proponents often take this to mean that Congress controls the bureaucracy. There are two problems with this conclusion. First, congressional dominance proponents do not discuss the constraints to using these procedures. The fact that Congress can use procedures to control the bureaucracy does not mean that it happens. Second, empirical studies examining control have found mixed evidence at best (Calvert, Moran, and Weingast 1987; Moe 1985, 1987; Wood 1988; Wood and Waterman 1991). Fortunately, the literature has moved beyond the dominance versus abdication question to examine when Congress exercises control and under

Understanding Congressional Control of the Bureaucracy

7

what conditions. The new approach continues to rely on theories of economic organization, which provides us with a micro-level theory that explains how action by one party can lead to action or inaction by another party. In fact, economic theories of organization provide a rich source of hypotheses about the connection between institutional choice and outcomes. Policymaking requires the coordination of many different decision-makers, and Congress cannot design procedures that facilitate control of behavior over all these actors at once. Therefore, our theories need to incorporate the complexity of a multi-institutional environment to capture the tradeoffs that members of Congress face in trying to control outcomes. Horn and Shepsle (1989) offer a good framework to begin examining procedural choice in a multi-institutional decision-making environment. They argue that control of outcomes over time is the larger problem facing an enacting coalition. Outcomes are the results that members of Congress hope to achieve through their policies. These outcomes can be as simple as the distributive benefits they wish to bring to their district, or as complex as regulating manufactures to achieve cleaner air. An enacting coalition faces two threats to control of outcomes over time: bureaucratic drift and coalitional drift (Horn and Shepsle 1989; Shepsle 1992). Bureaucratic drift occurs when the bureaucracy implements policy at odds with the enacting coalition’s intent. This happens when legislation provides discretion to an agency and bureaucrats use that discretion in a way that is inconsistent with the goals of the enacting coalition. Coalitional drift occurs when a new majority rises in the future and overturns what today’s coalition passed. Both problems derive from the fact that the creation and implementation of policy involve numerous actors. Members of Congress must work with these other actors if they wish to achieve their policy goals. This means that many different actors can alter the policy as it moves through the process. Enacting coalitions will attempt to reduce the probability of losing control through the design of procedures and institutions. These institutional devices limit the ability of other actors to alter outcomes in the future. A tradeoff exists between bureaucratic drift and coalitional drift because their appropriate institutional solutions contradict each other. That is, to guard against bureaucratic drift, an enacting coalition will want to make it easier to intervene in the implementation decisions of the bureaucracy. Therefore, Congress will design procedures that allow it to overturn agency decisions it does not like. However, to guard against coalitional drift, an enacting coalition will want to make it harder for future coalitions to change the policy. This means that the enacting coalition will want to insulate the agency from Congress because it fears that its political opponents will one day have the power to change the agency’s mission. We can see that designing institutions to guard against bureaucratic drift

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increases the probability of coalitional drift. Conversely, designing institutions to guard against coalitional drift increases the probability of bureaucratic drift. There are two implications from the tradeoff view of political control. First, our theories need to incorporate the impacts of procedural choice at both the coalition-building and implementation stages of the legislative process. Second, we need to move away from theories that ask if Congress controls the bureaucracy to theories that ask when Congress is more or less likely to exercise control. BUILDI N G O N T HE T R A D E O F F F O R M U L AT I O N The idea that coalitional drift and bureaucratic drift have different institutional solutions is an important one. It means that members of Congress cannot perfectly control policy outcomes and must often make calculated choices about the greatest threat to their control. The most common way to explain how members of Congress deal with this tradeoff is through a transaction cost framework. From a transaction cost perspective, institutions exist to help solve contracting problems. Transaction costs are simply the costs of monitoring and enforcing agreements among different parties. From this perspective, legislation is like a contract and participants in the legislative process are the contracting parties. Any barriers to protect members of Congress from coalitional or bureaucratic drift, which are both threats to a legislative agreement, would be transaction costs. If legislative agreements are like other contracts, then the participants will design procedures or provisions to reduce these costs. Therefore, we can explain procedural design as a way for politicians to minimize the costs of maintaining legislative agreements and controlling policy outcomes. Huber and Shipan (2000) point out that most of the transaction cost literature until recently has been interpretive in nature. The studies assert that Congress will find the most efficient way to control policy and then interpret whether the congressionally created institutions achieve that result. Huber and Shipan (2000) argue that the next steps should be to specify this theory more clearly, derive hypotheses, and systematically test them. Several studies have begun to examine institutional choice in this way (Bawn 1995, 1997; Epstein and O’Halloran 1994, 1999; Shipan 1997). In this book I build on these previous studies by examining the choice to review legislation. Specifically, I use transaction cost theory to explain congressional use of a procedure called temporary authorization. Temporary authorization allows for the review of implementation (or reauthorization) of legislation, and therefore makes control of policy easier. Notably, Congress does not require reauthorization for all programs and agencies. I argue that Congress uses reauthorization selectively because review en-

Understanding Congressional Control of the Bureaucracy

9

tails rebuilding coalitions in support of the original policy. My model predicts that Congress will use reauthorization when the costs of implementation are relatively high and the costs of coalition maintenance are relatively low. Throughout the rest of the book I will elaborate on this argument and develop hypotheses and test them by examining choices made by Congress.

CHAPTER 2

Four Models of Agenda Control

In the last chapter, I outlined the tradeoff argument in which enacting coalitions face tradeoffs when designing institutions to control outcomes over time. To specify this argument more clearly, I begin the process by reviewing what we already know about agenda control. The study of agenda control examines how institutional actors use rules and procedures to control policy outcomes.1 Although most studies in this field draw upon economic theories of organization as their theoretical framework, the field is made up of a diverse set of approaches. A review of different types of models, and their assumptions, will help us to understand why these models are unable to account for tradeoffs. This review should also help us to understand how to integrate these models so that they incorporate a broader view of control. To facilitate the discussion of this literature, I divide my analysis into four different types of control problems. I do this by examining four ideal types of models that look at four different types of control problems. My schema, presented in Table 2.1, arranges the agenda control literature along two dimensions. The first dimension is the stage of the legislative process, and the second dimension is the source of power that is a threat to agenda control. In the first dimension, there are two stages to the legislative process. These are coalition-building and implementation. Although there are exceptions (Bawn 1995; Epstein and O’Halloran 1994, 1999; Horn and Shepsle 1989; McCubbins, Noll, and Weingast 1987, 1989), the literature dealing with agenda control has historically been split between those examining the coalition-building stage and those investigating implementation questions. Most of the literature dealing with coalition-

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Table 2.1 Four Types of Models of Control and Their Predictions for the Use of Review

building seeks to explain relations between committees and the floor of the legislature. The implementation stage consists of relations between Congress and the bureaucracy. This dichotomy is not always productive because members of Congress must control the agenda in both the legislative and implementation stages to control outcomes. The second dimension is the source of power, which includes formal authority and expertise (Altfeld and Miller 1984). Typically, most studies focus on either expertise- or authority-based control. Studies that focus on authority generally employ a complete information assumption, while expertise models employ an asymmetric information assumption (Bendor 1988). These four ideal types are not meant to be exclusive and exhaustive, and some studies clearly cut across more than one ideal type. I chose these dimensions to simplify discussion of the literature and because they cor-

Four Models of Agenda Control

13

respond to theoretically important issues that I discuss below. Specifically, each of the four ideal models focuses on a different problem of agenda control in the legislative process. In the rest of this chapter I discuss these four parts of the literature in more detail. CO ALITI ON- B U I L DI N G S T A GE O F T H E LEGISLAT I V E P R OC E S S The first area of the legislative process that I review is the coalitionbuilding stage. I review two theoretical approaches that correspond to and are used for a discussion of agenda control during coalition-building: distributive theory, which makes arguments regarding authority-based control of policy outcomes, and information theory, which makes arguments about expertise-based control of policy outcomes. Authority-based Control at the Coalition-building Stage Distributive theories of one type or another have been around for many years (Fiorina 1989; Mayhew 1974; Schattschneider 1935; Shepsle 1989; Shepsle and Weingast 1981; Weingast and Marshall 1988). These theories assume that members maximize their probability of reelection by serving constituent interests. Because the interests of their districts diverge, members face problems of organizing themselves to build coalitions, and therefore reaping the benefits of producing benefits for their districts. In order to capture these gains from trade, members must overcome the conflict inherent in the diverse interests that they represent. Cooperation will not be easy under these circumstances. In fact, many formal theorists predict cycling and chaos in majority rule institutions (McKelvey 1976, 1979; Riker 1980). Shepsle and Weingast (1981) argue, however, that Congress is not strictly a majority-rule institution. They argue that institutions and procedures severely limit the number of possible outcomes and allow minorities to control outcomes within each policy area. From this perspective, structure limits choices to bias outcomes toward the status quo. According to Shepsle and Weingast (1981), several structures protect the status quo. First, Congress always votes against the status quo last. A majority must prefer any new alternative to the status quo before a new coalition will form. For example, many members of Congress want to reform the tax code by lowering rates and eliminating deductions. However, they cannot scrap the tax code and then write a new one. They must find a bill that a majority of members prefer to current law. Since so many constituents benefit from current tax breaks, they will always compare what they have in the current law to what they will gain from the reform.

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This limits the number of possible outcomes to only those that can beat the status quo in a paired comparison. Second, the powers of committees in Congress restrict the number of possible outcomes even more severely. For one, committees act as gatekeepers for challenges to the status quo. This means that any proposal challenging the status quo requires approval by the relevant committee (Shepsle and Weingast 1981; Weingast and Marshall 1988). This gives the committee virtual monopoly proposal power, and the committee proposal will usually go second to last. The result is that any amendment to the committee proposal must beat the committee proposal and the status quo in paired comparisons. For example, in the Democratic-controlled House of Representatives during the 1980s, many members wanted to water down the Endangered Species Act, but the House Merchant Marine and Fisheries Committee had jurisdiction over this legislation. The majority on this committee strongly opposed weakening the law, and simply sat on proposals to amend it (Barry 1991). Even if the committee cannot defeat all unfriendly amendments, the committee’s bill will often be protected by the rules of the House. On many important pieces of legislation, the House Rules Committee gives committees restrictive rules that limit the ability of the majority to amend committee bills on the floor. Shepsle and Weingast (1987) argue that even if these procedures do not protect committees from hostile majorities, then committee members still may be able to reassert their control through the conference committee. Generally, committee members sit on the conference committee and they can alter legislation in such a way to get back some of what they lost on the floor. Once again, the House majority has to vote against the conference bill and the status quo. These procedures protect committee jurisdiction from outside forces and allow a small minority to have a disproportionate influence on policy. Finally, separate institutions also protect the status quo. No one institution in the system can dictate to others (Neustadt 1990). For example, any original agreement requires the president’s approval, as do any changes to that agreement. Therefore, the costs of coalition-building will include either bargaining with the president or building a coalition large enough to override a veto. Many of these procedural protections stem from the checks and balances of the American constitutional system. Still, many other structures and rules were put in place by members of Congress themselves. Why would members of Congress design institutions that limit their choices? Weingast and Marshall (1988) argue that members do this because of the difficulty of forming and protecting coalitions in the congressional setting. To become part of a coalition, members want some assurance that agreements are stable. The committee system provides the necessary structure to protect these agreements. As a group, members create committee struc-

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ture to protect previous agreements from new majorities. Individually, members choose committees to protect bargains that are important to their constituents. Consequently, committee structure enables vested interests to kill proposals that challenge the status quo. According to distributive theory, conflict among coalition members representing diverse districts motivates organizational development within Congress. Most distributive models ignore asymmetries of information as a barrier to coalition formation. This means that members of Congress should all understand equally well the impacts of the policies they choose. Since they can anticipate outcomes, they do not need to delegate authority to experts. Structure exists solely to protect agreements by making sure that members cannot renege on agreed-upon bargains. This allows minorities to have veto power over bills important to their district’s interests. These structures also increase the costs of conflict, however. Institutions that protect the status quo allow minorities to raise the costs of coalition building. Numerous choke points require the majority to win often, and a minority to win just once. The result is that costs of blocking legislation will often be lower than costs of passing legislation. Even if a minority coalition cannot block legislation, it can make changing the status quo too costly in terms of time and political resources. Structure, therefore, reduces the costs of conflict in protecting the status quo, but increases the costs of conflict for overturning it. Expertise-based Control at the Coalition-building Stage Proponents of the second approach, information theory, see uncertainty as the driving force behind legislative organization. According to the informational approach, uncertainty increases information costs, which create an obstacle to coalition-building. From this perspective, congressional structure exists to reduce information costs through gains from specialization. Members do not require expertise on every issue because they rely on committees to inform them. Although specialization can be efficient, it also grants committee members information advantages, which they may use for their own gain. For example, members of the House Armed Services Committee specialize and understand defense policy better than the rank-and-file member. Recently, much of the debate over defense policy has centered on the level of defense spending to fight terrorism. Most members of Congress rely on committee members specializing in this area for information to understand this debate. However, if committee members have extreme preferences for high levels of defense spending, then the information they send to the House floor may be biased. These relationships have been modeled as signaling games. Banks lays out the basic elements of a signaling game in his book Signaling Games in

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Political Science (1991). The game consists of two players: a sender S, and a receiver R. The players act sequentially, with the sender choosing a signal to send to the receiver, and then the receiver choosing an action. The sender has private information not available to the receiver. Banks refers to this information as the sender’s type. The receiver has a set of prior beliefs regarding how his or her actions affect outcomes before the game begins, and then updates these beliefs after observing the sender’s actions (Krehbiel 1991). The receiver does not know what information the sender uses to make decisions, but the receiver can observe the sender’s actions. Therefore, the receiver must try to unpack the signal made by observing the sender’s actions, and try to decipher the sender’s private information. The receiver then has a new set of beliefs that are used to interpret the next signal. Receivers gain by delegating to senders because they do not have to take the time or effort to inform themselves on every issue. They can gain a better understanding of the relationship between actions and outcomes through the sender’s signals. However, the receiver only benefits to the extent that he or she can unpack the signal. To ensure unbiased information, the receiver may set up procedures that provide incentives for the sender to share the sender’s private information. One example of the information approach is Krehbiel’s book Information and Legislative Organization (1991). Krehbiel models the relationship between the majority interests of the floor (the receiver) and committees (the senders). There are two important postulates that drive Krehbiel’s information theory. First, majorities choose policies and procedures, and second, members of Congress have preferences for outcomes, but choose policies. Members of Congress are often uncertain about the connection between policies and outcomes. Therefore, the floor creates incentives to encourage members to specialize and become experts by joining committees. Allowing certain members to collect private information, however, allows those members to use that information for interests at odds with the majority’s interests. Consequently, majorities must use procedures both to encourage specialization and simultaneously to guard against the opportunistic use of information produced by specialization. Krehbiel argues that majorities achieve this balance by forming heterogeneous committees whose preferences mirror those of the floor. Committees made up of preference outliers do not often provide good signals, and therefore do not help members reduce information costs. The floor will give the most discretion to those committees that are least likely to take advantage of private information. Both distributive and information theories see members of Congress creating structure to reduce the costs of coalition formation. However, information theories see a lack of information or uncertainty over outcomes creating the primary costs of coalition-building. The difficulty of

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coalition-building increases as the uncertainty between action and outcomes increases. Uncertainty increases costs in two ways. First, members do not know what impact the legislation will have, and, second, some members understand the legislation better than others and may use this information to their advantage. CO NTRO L AT T H E I M P L E M E NT AT I O N S T A G E Almost all legislation delegates authority, and if members want to control outcomes, then they must have control over implementation as well as coalition formation. In this section, I examine problems Congress encounters in controlling outcomes at the implementation stage of the process. Studies that focus on the implementation stage, like studies examining the coalition-building process, have historically been separated into studies that examine control through formal authority and expertise (Altfeld and Miller 1984). The differences in emphasis and assumptions between the two approaches are as important for studies of the implementation stage as they are for studies of the coalition-building process. For example, if the primary problem of control is expertise, then research should focus on how members investigate bureaucratic actions and policies, or how they create procedures to inform themselves about those actions and policies. By contrast, if the primary problem of control derives from coordination between actors with differing legal authority, then we should study the impact of procedures and rules on outcomes. In the next two sections, I review the literature relating to these two problems of control, and discuss their implications for understanding the implementation stage of legislative process. Authority-based Control at the Implementation Stage One early and influential attempt to model congressional-bureaucratic relations is Niskanen’s Bureaucracy and Representative Democracy (1971).2 Niskanen models the budgetary interactions between a legislature and an agency. In his model, the legislature has a demand for services, but is concerned about the cost of those services. Bureaucrats have a single goal, which is to maximize their budget. Niskanen’s other assumptions give the agency an advantage over Congress in determining a budget level. First, the agent knows the legislative demand for services. Second, the agency has the only information on the cost of those services and does not have to reveal costs to the legislature. Finally, an agency can make an all-ornothing offer to the legislature. In other words, if the legislature turns down the agency’s budget request, then it receives nothing. Given these assumptions, the agency will request a budget that provides a set of services at a rate that the legislature barely prefers to no services.

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Niskanen’s model has been criticized because many of its assumptions do not seem to hold true in the real world. For example, there has been much debate about whether bureaucrats actually act to maximize their budget (Blais and Dion 1991). Undoubtedly, Niskanen’s most controversial assumption, however, is that agencies can make take-it-or-leave-it offers to Congress. Many argue that Congress has the countervailing power to accept, reject, or overturn any proposals made by an agency (Miller and Moe 1983). Even if we reject Niskanen’s take-it-or-leave-it assumption, other authority problems may arise in coordinating actions with other actors in the process. In the discussion of conflict during coalition-building, I noted how veto points between institutional actors could protect bargains from opportunistic behavior by other members of Congress. During the implementation stage, however, institutions that allow an enacting coalition to protect the status quo can paradoxically make delegated power more difficult to control. In other words, the original coalition that enacted the law delegating power may not exist to overturn an agency’s implementation decision (McCubbins, Noll, and Weingast 1989). McCubbins, Noll, and Weingast demonstrate in a multidimensional space how an agent can implement policy in a strategic way to avoid having its decision overturned. However, their finding holds even if we assume policy is unidimensional (Ferejohn and Shipan 1990). The following example shows how this can happen. Figure 2.1 represents the degree of activity on a policy dimension. The point at zero represents no activity, and anything to the right of it means that the actor favors more government activity. The committee’s proposal operates under a closed rule, which means that the committee has virtual monopoly proposal power. Therefore, the floor must take-or-leave the committee’s proposal, and in doing so it has to compare the proposal to the status quo. In these types of models the median voter is the person whose vote is necessary to win a majority, and therefore her position should always win. The committee median member’s preference is at Cm and the floor median member’s preference is at Hm. The president’s position is at P1 to the right of the committee’s position.

Figure 2.1 Strategic Implementation by an Agency

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The committee will report a bill consistent with the median’s position and that bill will go to the floor under a closed rule, meaning no amendments are allowed. The floor will vote for the committee’s bill because it favors it over no activity, which is the status quo. The president also favors the committee position over the status quo and will sign it into law. However, the policy must be implemented by Agency 1 whose ideal point is at A1. The agency may implement the policy at a point where the president (and the two-thirds of the House required to override a veto) prefers the position to the committee’s position. Consequently, if the agency implements policy strategically, other actors in the process will protect it from retribution. Any actor at a veto-point over legislation can block action. These actors include the House, Senate, a committee, or the president. In authority-based implementation models, conflict creates a major problem for control of implementation. However, it is not conflict between the agency and Congress that creates the problem, but conflict between decision points in a sequential decision process. Congress is obviously not helpless against strategic implementation by the bureaucracy. Congress can protect its interests through the budget process (Kirst 1969), the appointment process (Calvert, McCubbins, and Weingast 1989), by writing specific language in authorizing legislation (Epstein and O’Halloran 1994; Lowi 1979), and through administrative procedures (McCubbins, Noll, and Weingast 1987, 1989). However, there are costs to using all of these approaches. Writing specific legislation may be effective, but it counters whatever benefits Congress originally saw in delegating authority in the first place. Many other methods of control require ex post action by Congress, and these create the same potential for strategic implementation. Therefore, members of an enacting coalition cannot guarantee that a policy it passes will be implemented as intended. Expertise-based Control at the Implementation Stage Information asymmetries create additional problems for congressional control of delegated power. Even if Congress possesses the authority to overrule bureaucratic actions, it may be of little use if Congress possesses less information than the agency. This is a major problem because Congress delegates authority, at least in part, to encourage specialization as a way to deal with uncertainty. If members of Congress have the same information as bureaucrats, then they can write specific legislation and avoid delegation. Consequently, Congress must deal with asymmetric information or it will have little control over delegated power. Many studies have used principal-agent theory to explain asymmetric information relationships between Congress and the bureaucracy. Other authors have looked at the problem as a signaling game (Banks 1989; Bendor 1988; Bendor, Taylor, and Van Galen 1987). The two types of mod-

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els have many similarities, but one difference is that signaling games do not require an asymmetric information assumption between actors. Both parties can have incomplete information or asymmetric information. In principal-agent models, however, only one actor has more information than the other actors. In this section, I will only discuss principal-agent theory, partly because it is more common in studies of congressionalbureaucratic relations (Kiewiet and McCubbins 1991; Mitnick 1980; Moe 1984; Wood 1988; Wood and Waterman 1991), and because I have already discussed signaling games. Any relationship where one person relies on the actions of another is considered a principal-agent relationship (Pratt and Zeckhauser 1985). However, Arrow (1985) argues that these relationships only become interesting when information asymmetries exist. According to Arrow, two conditions create asymmetries of information. The first occurs when the principal cannot directly observe the actions of the agent. For example, in some employment relationships a manager may be able to closely monitor an employee, while in other contexts this is impossible. The second condition occurs when the agent’s actions do not solely account for outcomes. If the agent’s actions were solely responsible for outcomes, then the principal could infer the agent’s actions by observing outcomes. In principalagent language, these are problems of observability and measurement, respectively. When observability or measurement problems exist, then it is impossible to be certain that the agent is acting in the principal’s interest. The principal can only try to minimize agency losses by devising incentives so that the agent acts in the principal’s interest. There are two types of control problems that stem from asymmetric information (Arrow 1985; Moe 1984). First, there is a hidden action problem that occurs when the principal is not able to directly observe the action of the agent. This is also called the moral hazard problem. The term moral hazard, which comes from insurance literature, refers to an agent who buys insurance and may have little incentive to be safe. In the worst case scenario, an agent may even have an incentive to destroy property (Arrow 1985). The principal is unable to prevent this because she cannot direct the agent’s actions after the contract has been signed. The relationship between a person renting a car from a rental agency is a good example of a scenario creating a moral hazard. The car rental agency will often not be able to determine how the agent drove the car from its condition when returned. The inability to measure or observe the agent’s behavior may actually create an incentive for the agent to drive recklessly in that the agent will not suffer a loss for doing so. The second problem is called hidden information. Hidden information has to do with the agent’s beliefs, world view, or type. This is the information that the agent will use to make decisions. In principal-agent literature, this is also known as adverse selection. Again, this comes from

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insurance literature, where the principal is concerned about the agent’s type, but only the agent has this information. For example, an insurance company might not want to provide health care to someone who takes risks and does not take care of his or her health. However, only the agent knows if he or she is this type. Although principal-agent theory was not developed with political institutions in mind, several authors have used many of its concepts in a political context (Kiewiet and McCubbins 1991; McCubbins, Noll, and Weingast 1987, 1989; Moe 1984, 1987). Clearly, Congress faces both hidden action and hidden information problems in its dealings with the bureaucracy. Hidden action problems occur because it is too costly to directly monitor all actions by an agency. An extreme example was when member Congress found out that the National Reconnaissance Office was almost done building a $302 million office complex that oversight committees were barely aware of (Benenson 1994: 2369). Congress later required agencies to inform them of any future large-scale construction. Also, an agent may have information that he or she has little incentive to reveal to Congress. Congress may not know bureaucrats’ world views, or more simply, Congress may not understand complex policy areas to the same extent as the agency. If Congress faces these problems, then the relevant questions become: (1) How does Congress overcome these information problems? and (2) How successful is Congress in overcoming these information asymmetries? There are no straightforward answers to these questions. In a business environment, the principal can set up compensation schemes that give the agent an incentive to act as the principal desires. However, compensation schemes of the same type are not possible in the congressionalbureaucratic relationship. Any monitoring mechanism that informs Congress will also entail costs, and those monitoring costs must be weighed against the gain from overcoming informational disadvantages (Banks 1989; Moe 1987). FO UR D IF F E R E NT T Y P E S OF C O N T R O L PROBLEM S A ND T R A DE O F F S The models discussed above each make different assumptions and come to different conclusions about congressional structure. As noted above, I chose to concentrate my literature review on the differences in models across two dimensions because they relate to important characteristics of legislation, which I will begin to discuss in this section. Table 2.1 lays out the basic characteristics of each of the four models. The first characteristic is the model’s assumption about information between the actors. The second characteristic has to do with the source of power. These costs depend on the actors involved and the information assumption employed.

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Authority-based models focus on conflict as the characteristic that increases costs, while expertise-based models see uncertainty increasing the costs of control. The third characteristic is the threat to control. The sources of costs of control each create a different threat to control. Below I summarize these characteristics for each model as well as the different institutional solution needed to control each problem. Model 1: Distributive Theory Distributive theory focuses on relationships between committees and the floor, and assumes complete information exists between the two. Members of the enacting coalition all understand the impact of legislation, so uncertainty does not increase costs of coalition formation. Instead, costs arise from conflict between the actors. In other words, these are the cost of coalition formation and maintenance. The main threat to control is unstable coalitions. According to Weingast and Marshall (1988), the institutional solution to this problem is the committee system. Committees exist to control opportunistic behavior by members of a coalition and to thwart new majorities. Model 2: The Committee Expertise Model The committee expertise model also examines the relationship between committees and the floor, but assumes that information asymmetries exist between the two. According to this model, costs come from trying to understand the effects of policies, and relying on committees for information. Information asymmetries create problems of control for members of the enacting coalition because they have to ensure they are getting reliable information from the committee. Therefore, committee expertise creates the main problems for control by the majority. The institutional solutions to this problem are to allow majorities to intervene in committee decisionmaking on the floor, or to create heterogeneous committees (Krehbiel 1991). Model 3: Strategic Implementation Model In this model, interaction occurs between Congress and the bureaucracy, and complete information exists between them. Separation of powers and divergent preferences over policy outcomes create the enforcement costs. A blocking coalition may exist that prefers the agency’s position to the status quo. However, this assumes that the reversion point is the old status quo point at SQ1 in Figure 2.1. The institutional solution to this problem would be to allow the old policy to expire. Romer and Rosenthal (1978, 1979) discuss the implication of a changing status quo point in their setter

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model. If the legislation expires, then the status quo point moves to SQ3. The committee can now pass a new bill without being blocked. Expiration makes it harder to implement policy strategically, because the committee’s new position has to be compared to nothing rather than to the agency’s implementation. I discuss this model in more detail in Chapter 3. Model 4: Agency Expertise Model In the expertise model of the implementation process, asymmetries between members of Congress and bureaucrats are the main threats to control by an enacting coalition. The solution to this problem would be to audit the agency regularly, which would force the agency to justify its actions to Congress. Congress could also rely on the agency’s reputation to reduce hidden information problems (Bendor, Taylor, and Van Galen 1987). Contradictions in the Models Each of the four models suggests a different problem of control, and therefore, each predicts a different institutional solution. Some of these solutions contradict one another. For example, Krehbiel (1991) argues information-based models and distributive models are logically inconsistent. From Krehbiel’s perspective, committee structure exists to capture gains from specialization and to serve the interests of the majority or median voter. On the other hand, proponents of distributive theory argue that committees exist so that members can serve the interests of their constituents. Therefore, informational theories predict that committees will be representative of the house, while distributive theories predict that committees will be preference outliers (Krehbiel 1991). The contradiction that Krehbiel discusses stems from assumptions regarding minority or majority control and how much autonomy is given to committees. For example, Krehbiel argues that majorities can circumvent veto points by using procedures like the discharge petition or a motion to recommit with instructions during floor debate. However, these tactics are still costly, which is why they are rarely used. The more conflict between decision points, the more costly it will be to overcome the status quo. I will discuss in more detail the role of committee autonomy for a model of intervention in Chapter 3. The main contradiction that I look at is between Model 1 and the other three models. Model 1 assumes that the main institutional problem is cycling or unstable coalitions, and, therefore, the institutional solution is to make it difficult for future coalitions to rise. The main way this is done is through giving committee members authority to veto changes to the status quo within their jurisdictions. However, all of the other three

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models see future intervention as an important aspect of another control problem. In Model 2, future intervention by the floor occurs to control the committee. In Model 3, future intervention is necessary to thwart strategic implementation. And in Model 4, audits or other types of intervention become necessary to control agency expertise. I have argued that if we concentrate on only one stage of the legislative process, or one source of power, then we miss these contradictions. Some authors have already noted that current theories are too narrow to explain congressional control (Epstein and O’Halloran 1994, 1999; Horn and Shepsle 1989; Miller and Moe 1983; Moe 1987). Members must choose between institutions that allow future intervention, and those that do not. At this point, none of these theories explain well how members handle this tradeoff. In the next chapter, I develop an explanation that incorporates the different elements of these models and can explain the tradeoffs that enacting coalitions face. NO TES 1. The term agenda control has many meanings in the literature, but I simply mean the ability to control policy outcomes at different stages of the process. 2. Niskanen’s (1971) model includes both authority-based and expertise-based problems of control. However, although he assumes asymmetric information to be a problem of control, his formal model does not incorporate this assumption (Bendor 1988). I will review all his assumptions here because they are influential to later models, but I am more interested in his assumptions regarding authoritybased control.

CHAPTER 3

Toward a Tradeoff Explanation of Control

In this chapter, transaction cost theory is used to explain how enacting coalitions deal with tradeoffs to institutional design. In the last chapter, I argued that no one governance structure can solve all the problems of policy outcome control. Given the review of the last chapter, we can see that none of the four ideal models provide much guidance in helping us understand this puzzle. One problem with these models is that they focus on one control problem at a time and, consequently, miss the bigger picture facing enacting coalitions. This means that we need a theory that incorporates the impact of procedural choices at both stages of the legislative process and that accounts for both authority- and expertise-based control. Transaction cost economics provides a theoretical framework that incorporates both of these characteristics. Transaction cost theories examine agreements as their unit of analysis, whether they are economic contracts or political agreements (Epstein and O’Halloran 1999; Huber and Shipan, 2000; North 1981, 1990; Twight 1994; Weingast and Marshall 1988; Williamson 1975, 1985). The measurement and enforcement costs of these agreements are the costs of transacting (North 1991). Participants design institutions as a way to lower the costs of enforcement and reduce the probability of reneging on the agreement. Accordingly, contracting problems are really problems of institutional design (Williamson 1985). This approach is attractive because it explicitly examines institutional design questions. If we assume that legislative bargains are similar to economic contracts, then we can easily use this framework to explain institutional design in the legislative process. Moreover, transaction cost theory incor-

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porates notions of bounded rationality and multiple actors that are necessary to explain institutional tradeoffs. TRAN S A C T I ON C O S T T HE O RY Coase (1937, 1960) first proposed the idea of transaction costs by asking why organizations or firms exist if markets distribute goods efficiently. He argued that the costs of doing business were a function of production costs and transaction costs, and firms organize as a way to minimize transaction costs. From this perspective, economic organizations are not production functions, as neoclassical theory assumes, but agreements created to deal with transaction costs. Coase did not specify the source or types of transaction costs (Milgrom and Roberts 1992), but others, most notably North (1981, 1990) and Williamson (1975, 1985) have developed his ideas. In transaction cost economics, the transaction or agreement is the unit of analysis. The characteristics of the transaction create enforcement costs, and actors develop governance structures to reduce these costs. Costs differ for different types of agreements and governance structures vary accordingly. Therefore, to understand the development of institutions, we need to understand the source of transaction costs. Different approaches have been undertaken to develop a transaction cost theory, but these approaches all have three common elements. These elements include: (1) the behavioral assumptions of the model, (2) the types of transaction costs, and (3) the larger institutional structure of rules and norms in which the actors operate. Each of these aspects is discussed in more detail below. Behavioral Assumptions Williamson (1985) argues that assumptions of opportunism and bounded rationality drive transaction cost theory. He defines opportunism as seeking self-interest with guile, which simply means that people have different interests and, given the chance, will act on them. Opportunism increases transaction costs because either side may take advantage of a loophole in the agreement. This means that some care has to be taken to ensure that both sides live up to their end of the bargain. Williamson uses Simon’s definition of bounded rationality, which is that people are “intendedly rational but only limitedly so” (Simon 1961 as cited in Williamson 1985, 45). This simply means that actors pursue goals, but do not have perfect models of the world and cannot predict all future contingencies. North (1990) also assumes actors have limited cognitive abilities, and that ideology and subjective assessments of reality affect people’s decision-making. Sometimes bounded rationality and uncertainty are used interchangeably, but for my purposes they are different.1 Williamson defines uncer-

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tainty as shocks to the system, or the unpredictability of future events. He argues that contracting problems only become interesting when both uncertainty and bounded rationality exist. If contracting partners faced no uncertainty about the future, then contracting would be costless. Conversely, when nature is unpredictable, contracting becomes problematic. Even with an uncertain future, unboundedly rational parties could develop contracting parameters ex ante that account for the unpredictability of nature. As Williamson states: Given unbounded rationality, a comprehensive bargain is struck at the outset, according to which appropriate adaptations to subsequent (publicly observable) contingent events are fully described. Contract execution problems thus never arise. . . . (Williamson 1985:30–31)

People who use unbounded rationality assumptions argue that, even if perfect information does not exist ex ante, over time people adapt to these new conditions, and the institutions develop as if people were more perfectly rational.2 On the other hand, a bounded rationality assumption implies that the adaptations do not take place this quickly, and people’s subjective assessments of reality prevent them from assessing the situation completely (North 1990). Accordingly, actors cannot develop comprehensive agreements ex ante because of their cognitive limitations. Actors handle bounded rationality by either developing adaptations, such as simplified decision rules (Simon 1961; Wildavsky 1988), or developing governance structures that put fewer constraints on their limited ability to predict future contingencies (Williamson 1985). From the bounded rationality perspective, institutional arrangements allow actors to reduce the costs of an uncertain future, but they do not guarantee an outcome. Williamson says that if either opportunism or bounded rationality do not hold, then designing contracts involves few costs. If you assume that participants in the contract will not act opportunistically, then contracts can be written in very general terms. If you assume unbounded rationality, then participants can write very specific agreements that anticipate all future contingencies. In either case, enforcement costs do not exist. When these two assumptions do hold, however, transaction costs form a barrier to coordinating activity and constructing agreements. Characteristics of Transaction Costs The next part of the theory deals with the characteristics of transaction costs, where different types of transactions create different types of costs. There are two schools of transaction costs economics that, while sharing much in common, focus on different types of transaction costs. The first school, developed by Williamson (1985), focuses on three dimensions of

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transactions that affect the amount and types of costs. These dimensions include the specificity of assets involved in the transaction, the amount of uncertainty or complexity involved in the transaction, and the frequency of the transaction. Asset specificity has to do with the amount of sunk costs in a transaction. For example, if a company changes its production facilities to comply with a contract, then the sunk costs are high, and both sides have incentives to form hierarchical governance structures to protect their investments. The specificity of the assets may include human capital as well. If a large amount of training goes into learning specialized knowledge, then both sides may have an incentive to form a more permanent agreement. Uncertainty, or complexity, has to do with the difficulty of specifying the terms of the contract (Milgrom and Roberts 1992). Some transactions are straightforward and the manner in which they will be carried out is easy to specify ahead of time. The manner in which other transactions will be carried out, on the other hand, may be impossible to accurately predict. To illustrate this point, Milgrom and Roberts (1992) compare purchasing wheat to building a power plant. The purchase of wheat could take place with a simple contract that specifies amount, price, and time of delivery. However, there are many more elements that go into building the plant and the performance of contract takes place over a longer period of time. These two factors make future events related to building a power plant difficult to predict. For example, neither side can perfectly predict the future prices of materials or labor, nor any number of other variables. To predict all future contingencies in such a transaction would be impossible, therefore, the contract will likely include structures that allow the two sides to adapt to unforeseen circumstances. Finally, Williamson argues that the frequency that two parties transact also has an impact on the types of governance structures used. Regular interaction gives both sides the ability to reward and sanction each other, and allows each side to develop reputations. Consequently, transactions that occur frequently are more likely to develop cooperative structures of dispute resolution (Axelrod 1984). The second transaction cost approach differentiates between measurement and enforcement problems of agreements (North 1990, 1991). Measurement problems occur because at least one party has a hard time discerning the desirable qualities of a good. Milgrom and Roberts (1992) use the example of purchasing fruit to illustrate how this works. A piece of fruit has many valuable attributes that include taste, texture, and nutritional value. However, when someone purchases a piece of fruit, they may have difficulty measuring some or all of those desirable qualities. The more difficulty one or both sides have discerning these attributes, the higher the costs of the transaction. Moreover, one side may find it easier to measure these desirable qualities than does the other, which creates

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further costs. For example, a customer can inspect several pieces of fruit and only purchase those with desirable qualities. However, the costs to the seller to inspect each piece and set different prices by quality would be prohibitive. If measurement problems become too great, then the transaction may not take place because one or both sides may fear exploitation. This measurement problem clearly holds for legislation as well. When members of Congress vote for a piece of legislation, they vote for many different attributes. Members of Congress may have difficulty discerning the impact those attributes have on their goals. Members with expertise, including members of the relevant committee, can measure these attributes more accurately than others can. This problem may be worse for omnibus legislation that deals with a multitude of issues on one bill. If the problem of measurement becomes too great, then a coalition may not form. The second source of transaction costs is enforcement. The neoclassical model assumes perfect information, and therefore enforcement is not an issue because there are no unforeseen circumstances. When two parties have incomplete information, and therefore regret contracts they entered when additional information becomes available, it may be difficult to force compliance with the agreement. North (1990), like Williamson, also sees a correlation between frequent transactions and lower enforcement costs; the more often two parties interact, the more information they have about each other, and the less likely they will be to threaten their long-term relationship by cheating. North also argues that the more complex the transaction and the more difficult it is to enforce over time, the less likely that a cooperative solution can be found. Typically, transactions will only take place when a third party exists to enforce them. In other words, a state or coercive structure is needed to ensure the parties that neither side can renege on the agreement. North argues that it is not clear how these coercive structures form, but clearly they play a role in ensuring compliance with agreements. Although these two approaches use different concepts, they share much in common. Both see the transaction costs stemming from similar behavioral assumptions. Both argue that complex contracts, in which a great deal of uncertainty exists over future contingencies, are more likely to have complex contractual arrangements. Additionally, both argue that frequent transactions and the development of reputations reduce transaction costs. The main difference in these two approaches is Williamson’s (1985) focus on asset specificity. Transaction Costs and the Larger Institutional Structure The third element in transaction cost theory is the existing rules and norms that affect the incentive structure that is in place when parties enter into a contract. These institutional arrangements dictate options available

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to the actors in an exchange. For economic transactions, these rules include both the political apparatus and the institutions of the economy. Williamson (1985) argues that most of these rules and norms should be constant across contracts. North (1990), however, specifies the role of formal rules and norms more clearly. He argues that institutions exist to protect property rights and provide mechanisms that make enforcement of agreements possible. North defines property rights as the “rights individuals appropriate over their own labor and the goods and services they possess” (1990). Some valued attributes are in the public domain and people devote resources to capture them. Other valued attributes belong in the private domain and consist of property rights. Institutions protect people’s property rights and specify proper ways to pursue resources in the public domain. The better institutions specify and protect property rights, the more likely it is exchanges will take place. These constraints can be either formal rules enforced by courts, or informal rules enforced by social approval or disapproval. North also makes a distinction between institutions and organizations. He argues that organizations react to the incentive structures created by the institutional structure that exists. Put another way, the skills and knowledge that people develop, individually or through organizations, depend on the types of incentives that institutions create. Organizations have two choices of methods to maximize their return given a certain set of institutional constraints. They can devise contracts (governance structures) within these frameworks that protect their agreements, or they can seek to change the institutional structure. For example, logging companies can put their resources into adapting to the existing political framework, or they can put resources into lobbying activity that seeks to change that framework. While Williamson focuses mainly on the former type of organizational behavior, North shows that occasionally organizations seek to change the rules of the game. SUMMA RY Although there are some differences in the way North and Williamson frame their arguments, the basic the structure of the two arguments is very similar. • People are boundedly rational and opportunistic. These two characteristics make the creation and enforcement of agreements costly. • To deal with transaction costs, the parties, or organizations, involved in the transaction create governance structures that reduce the burden on the two parties in coming to and enforcing agreements. • The types and amounts of costs differ by the characteristics of the transaction. These characteristics, along with the larger institutional structure in which par-

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ties operate, create incentive structures that make some types of contractual agreements more likely than others. • Transactions that are complex are more likely to require complex governance structures. Repeat dealings and reputations can overcome these problems to a certain extent. However, the more complex the agreement, the less likely it is that cooperative structures will work to solve these problems. Instead, complex contracts will more likely require formal or informal rules to enforce them.

TRAN SAC T I ON C O S T T HE O RY A P P L I E D T O A LEGISLAT I V E S E T T I N G Now that we have reviewed the transaction cost approach, our next task is to understand how it can be applied to congressional activity. While other studies have applied some of these concepts to Congress, their focus differs from mine (Shepsle and Weingast 1987; Weingast 1992; Weingast and Marshall 1988). These studies examine relatively permanent institutions, such as congressional committees, within which decision making takes place. My goal, however, is not to explain the existence of these more fixed structures. Instead, I seek to explain how transaction costs contribute to the type of governance structures used for a particular agreement. To achieve control, the enacting coalition writes legislation and devises procedures (governance structures) that help to enforce the agreement into which coalition members have entered. Therefore, we can understand each piece of legislation as a separate contract. To understand differences in procedures, we have to look at costs that vary across legislation. In other words, how do the differing characteristics of legislation lead to different governance structures? This section outlines such an inquiry by breaking transaction cost theory into the three components—behavioral assumptions, characteristics of the transaction, and larger institutional structure—that were described above. Behavioral Assumptions in a Legislative Model The behavioral assumptions of my model are similar to those used by Williamson (1985) and North (1990). I assume that members of Congress are boundedly rational and opportunistic. This means that they cannot develop institutions that perfectly solve all control problems. Instead, they develop institutions that minimize their possible losses. Although the behavioral assumptions of the models are the same, we cannot assume that the members of Congress pursue the same goals as economic actors. I assume that members of Congress want to control policy outcomes for both reelection as well as other goals. Outcomes may include having a dam built, reducing the poverty rate, or protecting a local industry in their district. For my purposes, it does not matter

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whether their desire to control outcomes comes from serving powerful national interests, district interests, or a sense of justice. I only assume that members of Congress seek to control outcomes, and that they design procedures to achieve that goal. Characteristics of Transaction Costs in a Legislative Setting The next step in applying transaction cost theory to legislative agreements is to specify how differing characteristics of legislation create different transaction costs. In this area, economic transactions are not completely analogous to legislative agreements. According to Weingast and Marshall (1988), enforcement costs in coalition formation exceed those in market transactions because of noncontemporaneous benefit flows and nonsimultaneous exchange. Noncontemporaneous benefit flows occur because one piece of legislation may provide benefits at a different time than another. The authors use an example of a group seeking dams wanting to trade votes with a group seeking regulatory protection for an industry. Nothing stops the first group from reneging on the deal once the dams have been built. Nonsimultaneous exchange occurs because potential vote trading will take place across issues, and the votes may come up at different times. There is no guarantee that one side will not renege on the deal after its legislation passes. Given these characteristics and high enforcement costs, Weingast and Marshall (1988) argue that repeat dealings and reputations alone cannot overcome coordination problems. In a legislative setting, agreements always risk breakdown.3 The authors conclude that agreements only work in the context of legislative institutions that protect them. The long-term problems of cooperation in legislatures have similar characteristics to Williamson’s notion of asset specificity. Williamson (1985) argues that some transactions have more sunk costs, which makes the changing of transaction partners prohibitive for both sides. Similarly, in legislative agreements, members usually enter agreements with the belief that the agreement is relatively permanent. Members of Congress desire policy outcomes over time, and the outcomes of their agreements are continually at risk. In contrast, many market agreements take place at one point in time, when one side exchanges money for a good. Since almost all legislative bargains have something akin to highly specific assets, we have to examine other characteristics of transactions to explain differences in procedures across these agreements. To understand how the transaction costs of legislative bargains differ, and how these differences affect procedural arrangements, we must focus on those attributes that do differ across legislative agreements. The two characteristics I focus on are conflict and uncertainty. These concepts fit within the theoretical framework used here, and provide sufficient vari-

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ance across agreements to actually explain differences in the use of procedures. My review of the agenda control literature in Chapter 2 shows that these concepts play an important role in the literature. Authoritybased control problems only exist if there are conflicts of interests between decision points, which include the committee and the floor, the House and the Senate, Congress and the president, or Congress and the agency. Expertise-based control problems only exist when uncertainty exists. Although these concepts form an important link between different types of theories, they often have vastly different meanings across studies and commonly are not clearly defined. Therefore, in this section, I review different studies that use the concepts of conflict and uncertainty and discuss how their meanings differ. I then specify clearly my own definitions and compare them with these other models. Previous Studies Using the Concepts of Conflict and Uncertainty An early study that examined the impact of conflict and uncertainty on institutional development was Fenno’s (1966) Power of the Purse. Fenno argues that the members of Congress develop roles and routines as a way to reduce conflict and uncertainty inherent in the appropriations process. Other actors in the process know how each institution responds, so there are few surprises. Also, the Appropriations Committees in the House and Senate punish agencies that do not tell the truth. Fenno does not really define conflict or uncertainty. He only states that members of Congress need to reduce both to coordinate activities. McCubbins (1985) also examines the effects of conflict and uncertainty on the design of institutions, but he is more explicit about their meanings. He argues that amount of uncertainty and conflict over regulatory policy dictate the types of procedures used. McCubbins defines uncertainty as the cost of information. This could be either uncertainty over future events or uncertainty about future coalitions. He defines conflict as conflicts of interests caused by differences in district preferences. Bach and Smith (1988) argue that uncertainty affects the types of rules issued by the House Rules Committee in the House of Representatives. They argue that increased uncertainty stems from two changes in the legislative process. First, legislation has become more complex because issues have become more technical and legislation often comes to the floor in omnibus packages. Second, decentralization of power in the House led members to become more unpredictable in their voting patterns. Therefore, the majority party now uses more restrictive procedures to control the uncertainty of floor politics. Moe (1989) says political uncertainty and political compromise are what drive choices regarding bureaucratic structure. He defines political un-

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certainty as the inability of powerful interests to predict if they will be in charge of public authority in the future. Political compromise occurs when no one has enough power to dictate outcomes. According to Moe, political uncertainty stems from conflict among powerful outside interests. Clearly, these definitions of conflict and uncertainty differ. Some of these theories discuss information uncertainty and others behavioral uncertainty. Some authors appear to incorporate the two concepts together. For example, Moe’s (1989) notion of political uncertainty seems to incorporate both McCubbins’s (1985) definitions of conflict and uncertainty. Before I can develop an explanation for the use of temporary authorization based on these concepts, I must specify their meanings. Definitions of Conflict and Uncertainty There are many different sources of conflict in the legislative process. These include ideological conflict, party conflict, group conflict, and conflict idiosyncratic to a given piece of legislation. Probably all of these different types of conflict play some role in the choice of procedures. However, discussing conflict in highly specific terms reduces our ability to generalize across all types of legislation. For example, Moe argues that interest group conflict determines institutional structure, but the groups may differ greatly across legislative agreements. Although groups clearly matter, trying to operationalize such a variable would be extremely difficult. I take a broader view of conflict and define it as conflicts of interests caused by differences in preferences for policy outcomes. In most cases these preferences will be ideologically consistent across different policy areas. Therefore, we can operationalize this conflict as ideological distance between the actors involved in the legislative process. This view of congressional conflict is consistent with studies of roll call votes that find conflict tends to cluster along a single dimension (Daniels 1989; Poole and Rosenthal 1991). The second characteristic that affects transaction costs is uncertainty. This concept generally has two very different meanings. The first type occurs when someone is uncertain about nature, or the connection between policy and outcomes. For example, designing a policy to have a dam built in a district is not complex, and members can be relatively certain that the policy they choose will lead to the outcome they want. On the other hand, if an enacting coalition’s goal is to make the work place safer, then members of the coalition will be much less certain that their policy of creating a regulatory agency will lead to the desired outcome. The second type of uncertainty occurs when someone is uncertain about another person’s behavior, which is the uncertainty Weingast and Marshall (1988) discuss. An example of this type of uncertainty occurs when

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members of Congress are unsure who will support the latest tax cut proposal, or whether they can count on the bureaucracy to carry out the policy according to their preferences. These two types of uncertainty will be referred to as uncertainty over nature and behavioral uncertainty, respectively (Williamson 1985). Uncertainty over nature stems from the fact that people are boundedly rational and that the more complex the transaction, the higher the transaction costs. Behavioral uncertainty exists because of both uncertainty over nature and conflict. Behavioral uncertainty concerns the temporal stability of bargains, and the more conflict that exists, the less stable the coalition. This is similar to Moe’s (1989) notion of political uncertainty or Bach and Smith’s (1988) notion of uncertainty. The risk of coalitional drift and bureaucratic drift can be thought of as behavioral uncertainty. The risk of coalitional drift entails uncertainties about whether other members of the coalition may defect, or whether new members will create new coalitions in the future. The risk of bureaucratic drift is uncertainty of losing control when an agency’s decision differs from the intent of the enacting coalition. If the costs of enforcement do not exist, then these risks do not exist. For example, if little conflict exists between members of Congress, then the costs of holding the coalition together is negligible, and members of the coalition will have little worry that other members of the coalition will renege on the deal. Similarly, if legislation is not complex, members of Congress can specify more clearly their intent. Therefore, the characteristics of legislation may lead to increased enforcement costs, which then creates uncertainties about whether a deal that is made will be honored. Larger Institutional Structure in a Legislative Setting Institutions also affect the level of transaction costs. There are many different levels and types of institutional arrangements, and members have more control over some than others. I am interested in the procedures that Congress uses to help control a particular agreement. However, the procedures an enacting coalition chooses will be dictated by the incentives provided by the larger institutional structure. For congressional decision-making, the two most important structures will be the constitutional system of shared powers and congressional organization. These congressional structures can be either formal rules or informal norms. In this section, I discuss these more permanent structures and their impact on the choice of procedures to use. The key to understanding the impact of institutional structure on enforcement costs is to examine how institutions affect the way decisions are made. The constitutional system forms a sequential system of shared powers, where no one institutional actor can determine policy (Spulber and Besanko 1992). In this system, Congress acts first and sends a bill to

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the president before it becomes law. Coalitions within the House and the Senate and the president form the enacting coalition. Once legislation passes, the enacting coalition must often rely on other actors to implement it, and all these actors can alter the policy from the original intent of the enacting coalition. These actors include the president, the bureaucracy, and the courts. Additionally, a new enacting coalition can arise and change policy. Therefore, policy is not made all at once, but is continually adjusted and bargained over at these key decision points within the constitutional system. The president has an especially important role in this system because the executive branch has a formal role at both the coalition-building and implementation stages of the process. Except in the case where two-thirds of the members of Congress agree on policy, the president must approve the original deal, has a role in implementation, and can also block any changes to the deal. Moe (1989) argues that the president also figures prominently because of the resources the presidency can bring to bear in forcing its will in the implementation process. Therefore, Congress must consider the president’s role and preferences when designing institutions to control outcomes. The structure of Congress also forms an important part of the structural framework that influences enforcement costs. Within Congress, the committee system plays an important role in protecting agreements. Weingast and Marshall (1988) argue that committees enforce these agreements within Congress by acting as gate-keepers. In other words, they make it harder for new majorities to arise within Congress and overturn an agreement. The Legislative Reorganization Act of 1946 also gives committees the primary responsibility of oversight. This means that committees are responsible for ensuring that the bureaucracy follows the original agreement. The committee system, then, forms an important focal point of legislative activity, and is key to understanding the costs of congressional decision-making. Rules establishing committees and protecting their jurisdictions by themselves cannot force compliance all the time. Rules are simply agreements by old coalitions, and theoretically should be subject to the same instability as present coalitions (Riker 1980). A new majority can always overrule any old majority’s rules. Therefore, norms, routines, and accepted practices also form part of the institutional structures, and protect formal rules. Norms are important because they change the costs of enforcing agreements. Therefore, we have to examine these practices as well as formal rules. One example of how informal norms affect the implementation of rules can be seen in changes in committee power. Committee power is based partly on gate-keeping power that increases the costs to new majorities of overriding the status quo. Although committees can choose to not refer

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the bill to the floor, the majority has several procedural mechanisms to pull the bill out of committee. However, norms of reciprocity and respecting committee jurisdiction make this outcome unlikely. These norms can protect the committee on the floor as well, but these norms have become less important over the years. In the past, floor majorities only rarely amended committee proposals. In the 1970s, these norms weakened, and a committee’s ability to protect its bills on the floor decreased with them (Bach and Smith 1988). Weingast (1992) argues that when traditional norms were weakened committees had to find new governance structures to deal with the threat of being rolled on the floor. Weingast concludes that the committees did this through the use of complex rules that accompanied bills. Consequently, as the larger structure changes, the incentive structures for actors, such as committee members, in the process may also change, and this may lead to the use of different governance structures. TRAN SAC T I ON C O S T S , T Y P E S O F C O N T R O L PROBLEM S , A N D T H E C HOI C E O F P R O C E D U R E S IN A LEG I S L AT I V E S E T T I NG There are many different types of governance structures Congress can use to reduce the costs of enforcing agreements. One distinction we can make is between ex ante and ex post, or ongoing, control of bureaucratic drift (Epstein and O’Halloran 1999; McCubbins, Noll, and Weingast 1987). Ex ante controls are those in which Congress limits the discretion of an agency through administrative procedures, while ex post controls consist of review and oversight. Most of the transaction cost literature has sought to explain the creation of ex ante controls. The reason for this is probably that there is an assumption that ex ante controls constitute a procedural choice, such as due process requirements. Ongoing controls are seen as something Congress does after the fact, while the governance structure is simply the oversight system in Congress and, therefore, more of a constant. The point that I will make here is that Congress can make oversight easier or harder at the time legislation is passed. One way to ease ex post enforcement is by requiring reauthorization, which I will discuss in more detail in Chapter 4. Transaction Costs and Use of Governance Structures Conflict and uncertainty over an agreement, along with the decisionmaking structure, affect the amount and types of costs an enacting coalition faces when trying to control outcomes. Previous studies have hypothesized about how conflict and uncertainty affect ex ante controls. For example, McCubbins and Page (1986) argue that members of Congress should delegate a greater scope of authority, and more tools to use that

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authority, as conflict and uncertainty over legislation increase. Simultaneously, however, members limit discretion by applying more stringent regulatory procedures. The result is to limit the net discretion Congress gives an agency as conflict and uncertainty increase. Epstein and O’Halloran (1999) see slightly different relationships between conflict and uncertainty and the delegation of discretion to an agency. They argue that as uncertainty increases, Congress will delegate more discretion to the bureaucracy, which means a larger delegation and fewer restraints. According to Epstein and O’Halloran (1999), Congress has an incentive to give more discretion to the bureaucracy when uncertainty is high because it will gain from the information advantages. However, they hypothesize that Congress will provide less discretion when there is conflict between the median floor voter and the president. They assume that the agency’s preferences will not differ from the president’s and so they operationalize conflict between Congress and the executive as divided government. They also hypothesize that conflict between the committee and the floor will lead to more discretion to an agency because the median voter will worry about being exploited by committee expertise. Epstein and O’Halloran (1999) have put together an impressive data set of major legislation passed by Congress from 1947 to 1990 and found support for their hypotheses. My dependent variable differs from Epstein and O’Halloran’s in that I look at Congress’s choice to make review of policy implementation easier. In Epstein and O’Halloran’s model, Congress can veto changes by the agency back to the status quo, but in my argument Congress can create the ability to change agency decisions in any way that it wants. Therefore, Congress will choose governance structures that allow future intervention as uncertainty over legislation increases. Intervention allows Congress to manage measurement and observation problems that stem from delegating authority to experts. Several characteristics of legislation might contribute to uncertainty about future outcomes. First, when legislation is technical, members of Congress cannot specify all future contingencies, and, therefore, they have an incentive to create a structure that allows them to respecify as they gain more knowledge. Second, issues that have only been on the agenda a short time may create information problems for members of Congress. Members use specialization, expertise, and reputations to overcome many information problems (Banks 1991; Krehbiel 1991; Kreps 1990), but new issues make these strategies more difficult in the short run. Finally, the sheer size or scope of the legislation might create uncertainties. Members of Congress that have to vote for an omnibus bill at the end of the legislative session are much less likely to understand all of its impacts (Bach and Smith 1988).

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Conflict will also likely have a different impact for ongoing controls because Congress has to worry about coalitional drift. Increased conflict within Congress, holding everything else constant, will decrease the probability that Congress will use procedures that allow future intervention. Conflicts of interest increase the costs of contracting in several ways. First, divergent preferences make finding an acceptable compromise among members of an enacting coalition more difficult and time consuming. Second, the more divergent the preferences among members, the more incentive coalition members have to renege on the deal in the future. This makes maintaining the coalition more difficult. Finally, the more divergent the preferences of people who were left out of the original coalition, the more incentive these outsiders have to expend their time and resources trying to overturn it. Clearly, greater conflict increases the incentives people have to renege on a deal. A short illustration focusing on legislative agreements over different levels of conflict and uncertainty will demonstrate how this works. In this example, I assume that two parties, Party A and Party B, sit on a committee and both have preferences for some outcome. To achieve at least some portion of that outcome, they must come to a compromise agreement about an outcome they want. Instead of choosing outcomes, however, they choose policies, and they are uncertain to what extent their policies will lead to the outcome they agreed upon. For now, I ignore the problems of other actors outside the committee altering implementation toward their own preferences. Instead, I assume the two sides choose a policy, and subsequently the relationship between the policy they chose and the actual outcome are revealed. After the actual outcome becomes evident, they can alter the policy using this updated information, but only if both sides come to a new agreement. Behavioral uncertainty is the extent to which each side knows the willingness of the other to adjust policy to meet the original outcome they agreed upon. The amount of behavioral uncertainty between Party A and Party B will differ depending on the amount of conflict between the parties and the amount of uncertainty between policies and outcomes. I will review three scenarios to show how this works. In the first scenario, Party A and Party B have similar preferences for outcomes, but they are uncertain how to get those outcomes. In other words, they do not have enough information to specify an agreement that will get them what they want. In this instance, uncertainty over outcomes creates costs in writing the original agreement, and the parties may need to delegate the decision. However, once the relationship between policy and outcomes is revealed, the two sides can adjust the policy with little difficulty because they have similar preferences for outcomes. The risk and cost of coming to a new agreement are small. The two parties are coalition partners and they desire

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the same substantive outcome, and each of the party’s uncertainty regarding the other’s behavior is only a minor problem. In the second scenario, Party A and Party B have divergent preferences, but the relationship between policies and outcomes is more certain. The two parties will have a harder time coming to an agreement and will mistrust each other if they have to adjust the policy. Although behavioral uncertainty is more of a problem in this scenario, major adjustments should not be necessary because the two sides can determine outcomes ex ante. Therefore, there is no need to revisit the agreement. Finally, in the last scenario, the two parties have divergent preferences and are highly uncertain about the connection between their policies and outcomes. Neither side will be able to predict how the other side will act in the future because neither side knows what outcome a given policy will achieve. Unanticipated issues are likely to arise since their level of understanding of the underlying dynamics between policies and outcomes are low. The chance of agreeing on adjustment to the original policy is much less likely. The risk of the two actors’ agreement breaking down increases. In this last instance, the degree of uncertainty over outcomes interacts with conflict to make the two parties less certain of how the other side will behave in the future. Uncertainty can increase the costs of conflict among members of Congress. These examples focus on the congressional committee as the source of costs because most of the costs of putting together a new coalition will be borne by committee members. The argument is that a committee majority decides whether to require reauthorization for a program based on the costs of monitoring the program and the costs of bringing the issue in front of it again. This assumes that committees have the autonomy to make this decision and that they will not be overruled by the floor. The floor may have an interest in reviewing legislation if the committee’s preferences diverge from the floor’s. However, why would committees specialize if they were not given at least some autonomy? Clearly, committee autonomy is not an absolute and has changed over time. As we will see in later chapters, committees have exercised some control by making decisions about whether to require reauthorization and whether to bring the legislation to the floor. Conflict between other decision points will also increase the costs of coalition maintenance and reduce the likelihood of using intervening governance structures. After legislation passes, the conflict switches to a new arena. In this arena, it will be conflict between the president and Congress that will be most important.4 However, interbranch conflict works differently than conflict within Congress. I will display this by elaborating on my example in Chapter 2 (see Figure 2.1). Figure 3.1 represents the degree of policy activity on a single dimension.5 The assumptions are the same as those used for Figure 2.1. Here,

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on the other hand, the median voter of the enacting coalition, Em, becomes the status quo point at SQ1. However, the policy must be implemented by Agency 1 at A1. The agency is assumed to always prefer more activity than other actors in the process. After implementation, the policy status quo is at SQ2, which is to the right of Em. The president’s position is at P1, which is also to the right of the committee’s position. The committee and the floor of the House prefer the old status quo at SQ1 to the new status quo at SQ2. If the legislation is permanent and does not require review, the enacting coalition can try to pass legislation sanctioning the agency. The president prefers the agency’s position to Em and will veto the legislation. The situation is quite different if the legislation is not permanent. In this case, the legislation expires and the status quo becomes no activity at SQ3. The president’s veto will not work in this case because the president prefers Em to nothing. In Figure 3.2, the assumptions are the same, but in this scenario the president is not an advocate of the program. The agency again moves to the right of the status quo SQ1 to A2. However, the president is to the left of Em at P2. The committee can sanction the agency because the president prefers SQ1 to A2. Again, the situation changes if the bill requires review, but this time to Congress’s disadvantage. The president may prefer SQ3 or no program to Em. However, this will only happen if the president is closer to zero than to Em. In this instance the president can veto the new legislation. More likely, the two sides will reach a compromise. The enacting coalition will move its proposal to the left, to the point where the president prefers its position to nothing. Consequently, the committee’s bargaining position is not as good in Scenario 2 in which the president is not an advocate. HYPO TH E S E S The following four hypotheses can be derived from my transaction cost argument laid out above: Hypothesis 1: The more uncertainty between policies and outcomes, the more likely that intervening governance structures will be used, at a constant level of conflict. Figure 3.1 Strategic Implementation by an Agency When the President Is an Advocate

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Figure 3.2 Strategic Implementation by an Agency When the President Is Not an Advocate

Hypothesis 2: The more conflict between members of Congress, the less likely procedures allowing intervention will be used at a constant level of uncertainty. Hypothesis 3: Conflict between members of Congress interacts with uncertainty so that uncertainty increases the costs of conflict, which makes the creation of interventionist governance structures less likely. Hypothesis 4: When the president is an advocate of agency activism, Congress is more likely to create interventionist governance structures.

In the next four chapters I assess these hypotheses. In Chapter 4, I lay out the choice to use temporary authorization as an example of a procedure that requires review or intervention. In Chapters 5 and 6, I use case studies to examine the choice of authorization status for different agencies. Finally, in Chapter 7, I operationalize these concepts and test my hypotheses using legislation passed in the 100th and 101st Congresses. NO TES 1. Uncertainty and bounded rationality may actually form a continuum of information assumptions, and often these models share much in common. However, these assumptions can lead to widely divergent predictions about behavior (Bendor and Hammond 1992). 2. This form of uncertainty is probably closer to the arguments made by McCubbins, Noll, and Weingast (1987, 1989). 3. Frequent turnover and change in coalition partners only compound these coordination problems. 4. Conflict between the implementing agency and Congress may also be important, but I am assuming that this conflict is constant. In other words, I assume that the agency always wants more policy activity than other actors in the process. 5. This dimension is not the same as an ideological dimension as measured by ideology scores. This dimension represents policy activity and, in most instances, moving to the right will mean more activity and, therefore, a more liberal ideology. However, this may not always be the case. For example, in foreign policy and defense spending more policy activity may mean more conservative ideology. I use policy activity in this example in order to fix the agency’s position relative to the enacting coalition and make the analysis more tractable.

CHAPTER 4

The Authorization Process

In the last chapter, I developed a transaction cost argument for tradeoffs and derived from it hypotheses regarding the use of procedures. I argued that, depending on the relative enforcement costs, an enacting coalition would use intervention in some situations and shun it in others. In this chapter, I begin to discuss temporary authorization, which is a procedure that allows future intervention. Programs that receive temporary authorization require renewal by Congress. Consequently, this procedure provides an opportunity for members of Congress to intervene in the implementation of policy, but comes with costs and the risk of losing control within Congress in that an enacting coalition cannot be sure that future coalitions will not move policy in a new direction. An enacting coalition can choose to use temporary or permanent authorization, but either choice presents problems for control of the agenda. Theoretically, the choice regarding authorization provides the perfect example of members of Congress choosing between different types of control. In the real world, however, the authorization process is much more complex than a binary choice between temporary and permanent status. Congressional rules are rarely so absolute. Even though one Congress cannot bind the hands of a future Congress, this does not mean that a path chosen by one Congress does not make a future path more difficult. To understand how congressional procedures can modify the probability of future courses of action, we must have a deeper understanding of how these procedures work. My main goal in this chapter is to show that the choice between permanent and temporary authorization at one point in time has an impact

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on the shape of future choices. Once we understand how this process works, we can compare its use across legislation to test hypotheses. I attempt to show that the choice of authorization status has real impacts in three ways. First, I discuss how the authorization process works. The rules of the authorization process are quite complex, and differ between the two houses. In this section, I will review this complexity, but also explain how more simple motivations and norms influence how Congress carries out these rules. Second, I explain how the norms and rules of the authorization process create benefits and costs of temporary authorization on future decision-making. These costs and benefits form a governance structure that members of Congress find useful under some circumstances, but find burdensome under others. Finally, I review the history of the development of temporary authorization. I argue that Congress began to use this procedure as a way to deal with the increasing difficulty of controlling the bureaucracy. The review of the workings and history of this procedure will provide sufficient background to understand the next three empirical chapters. HO W T HE A U T H OR I Z AT I O N P R O C E S S W O R K S The procedures guiding spending decisions differ from other types of decision-making in Congress. In most areas of policy making, Congress delegates jurisdiction to one committee in each house. However, early in its history, Congress divided spending authority into two functions and across many committees. These functions are known as authorization and appropriation.1 The main purpose of this two-stage system is to ensure both representativeness and responsibility over spending decisions. These two goals can often conflict with one another, but both are important to individual members. Members want influence over distribution decisions affecting their districts, but some restraint is necessary to contain spending impulses.2 The development of a two-stage process over spending decisions demonstrates the tensions between these sometimes conflicting purposes. In the authorization process, Congress creates programs and sets programmatic goals. The authorization function lies with several different committees and allows many members to influence spending decisions by spreading out authority. Conversely, the ability to appropriate money lies solely with the House and Senate Appropriations Committees, which brings some responsibility to the process. In theory, money for government operations cannot be spent unless Congress first creates these functions in law through the authorization process and then approves the spending through the appropriations process. The rules of both the House and Senate set boundaries between authorization and appropriation. In both houses, the rules bar legislation in

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appropriations bills, unauthorized appropriations, and appropriations in authorization bills (Tiefer 1989). For example, the authorization committees create programs or agencies, but these bills cannot carry wording that allows appropriations. Similarly, the appropriations bills can only approve spending for functions already created and cannot create new functions. Generally, this means that the appropriations bills can include language that restricts activities, but they cannot include language that requires activities (Tiefer 1989). The authorization and Appropriations Committees both have control over the actions of the other. Authorization committees write legislation and can set dollar ceilings for programs they create. For example, an authorization committee could authorize $100,000,000 for program X in year Y. The Appropriations Committee may appropriate up to that $100,000,000, but can go lower or even approve none of it. However, an expectation exists that the Appropriations Committees should approve sufficient funding to carry out the programs that Congress creates (Fenno 1966). One simple distinction between the two types of committees is that authorization committees have authority to set ceilings on spending while the Appropriations Committees have authority to set floors. Authorization committees may leave more discretion to the Appropriations Committees if they wish. The authorization committees do not have to set year or dollar limits on the authorization legislation they pass. Congress authorizes many programs and agencies with the simple clause “authorization of such sums as necessary.” This leaves the floor and ceiling of spending entirely up to the Appropriations Committees. In other cases the authorization assigns a definite amount or a fiscal year limit on the authorization. These are known as temporary authorizations.3 Consequently, authorization committees can choose to put programs or agencies on either temporary or permanent authorization. To understand the impact of this choice, we must understand how the rules of Congress separate authorization and appropriations functions. The rules most relevant to this discussion forbid unauthorized appropriations, which means that no appropriation can be passed unless first authorized. This prohibition serves an important function in protecting authorization committee jurisdictions and dispersing power. In other words, the prohibition on unauthorized appropriations keeps the Appropriations Committees and other members from using the appropriations process to do an end run around an authorization committee’s jurisdiction. If the prohibition on unauthorized appropriations were absolute, then no appropriations could be approved for a program until programs or agencies with temporary authorization were reauthorized. Fisher (1979), however, argues that the actual practice is not quite so precise. A rigid adherence to the prohibition on unauthorized appropriations would often

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deprive Congress of the flexibility it needs to meet other goals (Fisher 1979). So, members of Congress frequently find ways to work around this prohibition when necessary. Consequently, to understand the impact of temporary authorization, we have to examine the practices Congress uses in actually implementing this rule. House and Senate Rules Relating to Unauthorized Appropriations Both houses have rules that restrict unauthorized appropriations, but they have very different ways of carrying them out. In the House of Representatives, rule XXI, clause 2 of the permanent House rules prohibits appropriations for unauthorized legislation (Brown 1996).4 Any part of an appropriations bill that comes to the floor without an authorization is subject to a point of order.5 This rule maintains an important source of power for authorization committees because it keeps the House Appropriations Committee off their turf. Since any member can raise a point of order against unauthorized appropriations, it becomes virtually impossible for the House Appropriations Committee to include this type of legislative language without the relevant authorization committee’s consent, or any other member’s, for that matter. Senate rule XVI also forbids unauthorized appropriations, but the rule refers mainly to amendments because appropriations bills have traditionally originated in the House, and the Senate does not raise points of order to House bills (Tiefer 1989). Moreover, the Senate is not as strict in its limitations to unauthorized appropriations in other ways. The Senate rules allow members of the Senate Appropriations or the authorization committee with jurisdiction to offer amendments allowing unauthorized appropriations, which makes it much easier to include unauthorized appropriations in the Senate than in the House. These rules also only apply to House bills. In recent years, the Senate has begun to introduce its own appropriations bills, and these bills are not subject to a point of order (Streeter 1999). As I stated above, both houses also have several exceptions and ways to bypass the rules barring unauthorized appropriations. In the House, precedents have established that programs do not become subject to points of order, even if their authorizations have expired, as long as the agencies or programs have organic statutory existence. The fact that Congress creates a program, agency, or duties for an agency is enough to assume authorization exists (General Accounting Office [GAO] 1992). It is not always clear if previous legislation allows for authorization or not, however (Brown 1996). The burden of proof falls on the person proposing the appropriation to show that authorization exists. One clear case is when the agency’s statutory authority explicitly calls for temporary authoriza-

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tion. For example, in the case of the FTC in 1974, Congress added language to the agency’s statutory authority that required reauthorization before Congress could approve an appropriation. If an authorization committee includes language that explicitly calls for reauthorization, then the old authorization does expire. Even in these cases, a majority in the House of Representatives can pass unauthorized appropriations using one of two methods. The first method is to go through the House Rules Committee. Most important legislation that comes to the floor first goes through the House Rules Committee (Smith 1989). The Rules Committee passes a House Resolution, known as a rule, which sets the terms of debate for a piece of legislation. For example, the rule can set time limits on debate or detail which amendments can be offered on the floor. The rule can also waive points of order against the permanent rules of the House. In some cases, the Rules Committee waives points of order against rule XXI, clause 2. This makes the prohibition on unauthorized appropriations meaningless for this one piece of legislation, or at least for part of it. The second method is through continuing resolutions, which are not regular appropriations bills and not subject to rule XXI. Therefore, Congress can both authorize and appropriate funds within a continuing resolution (GAO 1992). For example, Congress often does not pass the foreign aid authorization, but instead passes a continuing resolution to continue foreign aid programs (White 1993). The House Appropriations Subcommittees have in the past refused to pass unauthorized spending in the regular appropriations bills, and the unauthorized portions of the bill must be passed in a continuing resolution. In most cases, Congress uses continuing resolutions when the budget process has broken down and Congress is unable to pass its appropriations bills. The Senate rules also offer opportunities to bypass the restriction on unauthorized appropriations (Tiefer 1989). The Senate’s constraints are less severe to begin with, but the Senate also finds it advantageous to have mechanisms that allow the majority to get around these restrictions. In the Senate, when an appropriations bill that contains unauthorized appropriations comes to the floor, any Senator can raise a point of order. The Chair then rules in consultation with the Parliamentarian. If the Chair upholds the point of order, then the Senator managing the bill or amendment can appeal the ruling to the floor, and a simple majority of Senators can overrule the ruling of the Chair. The only restraint against a majority of Senators overruling the Chair is the norms of deference to the authorization committee on these questions. As we can see, the authorization-appropriation dichotomy is not absolute. Congress has established many procedures and precedents that allow flexibility in working through these two processes (Fisher 1979). However, this does not mean that these practices and exceptions violate

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the principles that the rules were set to preserve, namely to protect authorization committee jurisdiction from other members of Congress. If majorities were able to do an end run around the authorization committees in the appropriations process, then the authorization committees’ jurisdiction and gate-keeping powers would be greatly diminished. Instead, these exceptions allow Congress to move through the legislative process without becoming paralyzed by the prohibition against unauthorized appropriations. Although the methods of bypassing the prohibition against unauthorized appropriations have existed for many years, historically these methods have not been used to bludgeon the power of authorization committees. Several examples demonstrate that Congress implements these exceptions in a way that respects committee jurisdiction. One example of this deference occurred during Democratic control of the House. The Democratic Caucus’s rule 37 required the Appropriations Committee to inform the relevant authorization committee chair of any violation of rule XXI in an appropriations bill before it came to the floor (Democratic Caucus 1989). When the Republicans took over the Congress, they amended rule XXI by adding a clause requiring the House Appropriations Committee to state all unauthorized appropriations in the report accompanying the bill. These types of provisions provide the information that makes it easier for authorization committees to protect their jurisdictions. Additionally, Democratic members of the House Rules Committee had a practice of not granting waivers to rule XXI, clause 2 if the authorization committee with jurisdiction protested. For example, the House Rules Committee generally will not waive points of order for an appropriations bill at the authorization committee chair’s request.6 In my review of debates over House appropriations bills in the 104th Congress, I found that the Republican Congress continued this practice. An example that illustrates this point occurred during debate over the rule for the Defense Appropriations bill in the 103rd Congress. The Rules Committee waived all points of order in the bill except for two sections that the chair of the Armed Services Committee, Ronald Dellums (D-CA), protested.7 The House Appropriations Defense Subcommittee attempted to include funding for an aircraft carrier and place restrictions on peacekeeping forces that were not included in the Committee on Armed Service’s bill. Although the Defense Authorization bill had not been signed into law, the Rules Committee respected the committee’s jurisdiction over defense authorization questions. Since these two sections of the appropriations bill were not protected, a simple point of order during debate was enough to kill them. The House Rules Committee often protects the authorization committees from unfriendly amendments during the appropriations process too. Frequently, the Rules Committee will waive points of order for portions

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of the bill that the authorization committee approves, but will not waive them for amendments. Even if the Rules Committee grants an open rule, amendments may be subject to a point of order if a program’s authorization has expired. When the Republicans were in the minority, they often complained about the unfairness of this process, because many of their potential amendments were subject to points of order (Solomon and Wolfensberger 1993). To summarize, then, the rules prohibiting unauthorized appropriation exist to protect the jurisdictions of authorization committees from end runs in the appropriations process. Several methods exist to get around these rules, but historically they have not been implemented without the approval of the authorization committee chair to facilitate noncontroversial goals. There is little evidence that majorities have in the past used these methods to routinely thwart the priorities of authorization committees. In later chapters I will discuss how the changes in the use of temporary authorization has put pressure on the procedures and practices of the appropriations process. As it has become more difficult for authorization committees to pass their authorization legislation, members have had to use the appropriations process as a way to achieve legislative goals. In some cases, this may have marginalized the authorizing committee and made it harder for the committee to control its jurisdiction. It has also probably changed the calculations for members of Congress when they decide the authorization status of a program or agency. IMPACTS OF T E M P OR A RY A U T H O R I Z AT I O N In the last section, I argued that the rules and practices of the House and Senate regarding the requirement that authorizations precede appropriations protect the jurisdiction of the authorization committees. Authorization committees sometimes choose to give laws temporary authorization. The fact that they use temporary authorization selectively implies that it has some impact on their ability to control their jurisdictions. In this section, I will look at the advantages and disadvantages that temporary authorization confers on an enacting coalition and the authorization committee with jurisdiction over that law. Benefits of Temporary Authorization There are two general reasons given that authorization committees use temporary authorization (Fisher 1983; Schick 1980). The first reason is that this procedure serves as a means for congressional oversight and control of bureaucratic implementation. The second reason is that by using temporary authorization, authorization committees gain leverage over the

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Appropriations Committees to increase funding for their favored programs. These reasons for use to temporary authorization are not mutually exclusive and no clear evidence has been offered for either one, but I will review the arguments commonly given for each. There are many reasons to believe that reauthorization is an effective tool for oversight. First, bureaucrats are likely to be more responsive if their budget is not assured. At the very least, members of Congress appear to believe that agencies requiring reauthorization are more responsive to them (U.S. Senate 1977). Second, reauthorization also allows Congress to collect information on agency behavior. For example, Jajnige (1968) found that in the early years of the National Aeronautics and Space Administration (NASA), Congress used the reauthorization procedure as a way to learn about a new policy area. After several years of annual authorization, the authorization committee relied less on experts from NASA and began to feel knowledgeable enough to make its own independent judgments. When an authorization is temporary, Congress can also force administration officials to testify at hearings and defend their performance. In fact, Aberbach (1990) found that committee staff ranked reauthorization hearings as one of the more effective oversight tools at their disposal. Third, review through authorization allows members of Congress to specify their intent more efficiently than they can through the normal legislative process. In fact, when an agency’s or program’s funds come up for reauthorization or appropriation, Congress has one of its best opportunities to convey its viewpoints and thereby change agency behavior. Kirst (1969) described how Congress uses reports and hearings to control agency behavior through the appropriations process, and this same type of control occurs during reauthorization. By all accounts, the agencies take the reports of authorization and appropriation bills seriously (Fisher 1991; White 1993). Although there is often conflict over the legal authority of these reports, the bureaucracy follows the instructions because the alternative could very well be even more specific legislation constraining bureaucratic discretion (Fisher 1991). Finally, authorization provides a more comprehensive oversight tool than the appropriations processes. Congress will often attach limitation riders to appropriations bills to stop the bureaucracy from engaging in some activities. The most well known rider is known as the Hyde Amendment, which limits the use of federal funds for abortion services. Devins (1987) shows the weakness in this approach. Congressional rules do not allow legislation in an appropriations bill, so Congress can only write very narrow language limiting the spending in a particular area. In the case of the Hyde Amendment, the original version included a provision allowing funding in the cases in which the health of the mother was at stake. However, a point of order was raised against the amendment, because this amounted to legislating on an appropriations bill. Hyde and other

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supporters of the bill had to leave out this exception in order for the amendment to be valid. The authorization process, on the other hand, allows Congress to make much more precise changes in the law, and therefore supplies Congress with more subtle and direct control over the bureaucracy. The other reason given for congressional use of temporary authorization is that it helps the authorization committee in conflicts with the House Appropriations Committee. Some argue the movement to temporary authorization was not driven primarily by a desire for oversight, but as a way for liberal authorization committees to exercise more control over the House Appropriations Committee (Dodd and Schott 1979; White 1993; Wildavsky 1988). The House Appropriations Committee would often cut deeply into authorization levels set by the authorizing committees. These authors argue that the House Appropriations Committee finds it harder to cut authorized spending levels after the floor has approved a higher authorization level. However, little evidence exists that temporary authorization leads to higher appropriations levels, and there is reason to believe that appropriators largely ignore high authorization levels. Representative Sherwood Boehlert (R-NY) reflected this sentiment during debate over the National Science Foundation (NSF) reauthorization in 1994: These authorization debates we have, have come to remind me of nothing so much as the children’s program “Mr. Rogers’ Neighborhood.” It is as if, at the beginning of authorization discussions, we take off our coats and shoes, put on our cardigans and slippers, affect our mildest expressions and most benign tones, and pretend that we can be nice to everybody in our neighborhood—which is to say everyone in the Nation. We sing soothing songs of plenty for our hour of fantasy, and then we let the appropriators bring disharmony of reality into the world.8

Clearly, conflict does exist between these two types of committees, and temporary authorization probably exacerbates this conflict. Even if putting pressure on the Appropriations Committees was one of the goals of authorization committees in moving toward temporary authorization, it does not mean that oversight was not also an important factor. I will focus primarily on the oversight value of temporary authorization, but I will address the role of conflict between authorization and Appropriations Committees in Chapter 5. Costs of Temporary Authorization There are also several costs to using temporary authorization from the perspective of the enacting coalition and the authorization committee. The main reason that these costs exist is that temporary authorization implies

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a commitment to review the legislation in the future. This expectation carries over to other members of Congress. It rarely happens that once Congress has made a commitment to reauthorization it does not come back to those laws. For example, Congress spent a great deal of time on several laws that were up for reauthorization in the 103rd Congress. These included Superfund, the Endangered Species Act, and the Clean Water Act. Congress was not able to pass any of them, but the efforts did not die. The Republican 104th Congress took on all these reauthorizations. The expectation of action carries with it several costs. One of the main costs to the committee stems from the time it takes to pass legislation. This entails holding hearings, rewriting legislation, meeting with interest groups, and building new coalitions. This will also take up time and staff resources. A glance at activities of any recent Congress demonstrates that members spend a good deal of time and effort just on reauthorization legislation. Another potential cost is that a committee can lose control of the legislation once they bring it back into the legislative setting. There are two ways this can happen. First, turnover in Congress or on the committee can lead to different preferences for policy. For example, turnover and changing preferences may have led to a change in the attitudes toward regulatory enforcement by the FTC (Weingast and Moran 1983). In Chapter 5, I will show that temporary authorization played an important part in allowing the committee to change policy. Second, since the committee, which manages bills on the floor, cannot perfectly predict what issues will arise once the new policy is being implemented, it also doesn‘t know how stable the original coalitions will be. This means that members of Congress will use the reauthorization of legislation to introduce amendments that the majority on the authorization committee may not want. Members of a committee can spend a lot of time and political capital just fighting off these end runs around their authority. I will discuss several examples of this in Chapter 6. If the costs of passage or risk to control are too great, then a committee may not try to pass the authorization. However, once the commitment to reauthorization has been made, a lack of action also entails costs and potential loss of control. If a program has a hard time getting through Congress, then it may lapse for a period or even end. In some cases, the House Appropriations Committee has refused to approve funding for programs with lapsed authorizations. Similarly, the authorization committee will have to rely on the Rules Committee to give the Appropriations Committee a rule waiving points of order. There is no guarantee this will happen. If a committee fails to pass an authorization bill, then it will have less clout with the Rules Committee, because the appropriations process becomes the only method for the party and the majority to change legislation and to control the Executive. The House Foreign Affairs and Senate

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Foreign Relations committees came close to becoming irrelevant in foreign aid policy because of their inability to pass their authorization bills in the 1980’s (White 1993). In this instance, the appropriations subcommittees became the major actors in the foreign aid policy area. Another example is the Legal Services Corporation. The Judiciary Committee has rarely been able to pass an authorization bill because of the controversial nature of the Policy. As a result, it is very difficult for the committee to exercise control over the program. TH E CH A NGI N G U S E OF T E M P O R A RY AUTH OR I Z AT I ON Temporary authorization can be thought of as part of the broader category of temporary delegation. Under this structure, Congress delegates authority to the executive, but puts a time limit on how long that authority exists. Congress began to use temporary delegations during the New Deal era. One of the first pieces of legislation that incorporated this concept was the Reciprocal Trade Act of 1934. This act gave the president authority to enter agreements to reduce tariff levels, but this authority was only given for three years. Congress has renewed this authority on a regular basis since then, but beginning in the 1960s used the review of the authority to add more requirements to it (Sundquist 1981). Another example of this practice was the temporary delegation of authority to the president in the Reorganization Act of 1939. The Brownlow Commission suggested that the president should have the power to reorganize agencies to achieve managerial control and efficiency, and President Roosevelt asked for this power in 1937 (Arnold 1986). Unfortunately for Roosevelt, his request for increased managerial discretion coincided with his attempt to pack the Supreme Court. Under these circumstances, Congress was suspicious of granting any new discretion to the executive. Congress passed the Reorganization Act two years later, but included in it a two-year time limit and a legislative veto (Arnold 1986). Even at this early stage of the growth of the executive branch, Congress recognized that temporary delegation could be a useful check on presidential authority. Congress has renewed the reorganization power periodically over the last 50 years. The power lapsed during the end of Nixon’s Presidency, when Congress was reluctant to grant any authority to the executive (Sundquist 1981). Probably the first time Congress used temporary delegation in the authorization process was when it created the Marshall Plan (Landsidle 1975).9 President Truman requested that Congress authorize and appropriate money for European recovery. However, the Republican-controlled Congress resisted the idea of bestowing authority to the president and the State Department without strings attached. The Foreign Aid Act of 1947,

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which authorized foreign assistance to Europe, had several elements that limited the discretion of the executive. First, Congress insisted that part of the aid be given in loans (Kindleberger 1987). Second, Congress insisted that the State Department not run the program. Congress created the Economic Cooperation Agency (ECA) to implement the program because members thought that this new agency would be more responsive to Congress (Arkes 1973). Finally, Congress passed a one-year authorization for program funds. This temporary delegation would enable Congress to have more control over the agency, and to adapt to unforeseen circumstances if they arose. Marshall Plan aid is a clear example of Congress deciding to delegate authority to the executive branch, but wanting to maintain a large degree of control. Writing specific guidelines would be difficult because this was a new type of program, and Congress could not anticipate all future contingencies. Members of Congress wanted the ECA dependent on them so that they could protect American business interests and insulate ECA decision-making from the president and State Department influences as much as possible. Congress tended to focus its early use of temporary authorization on programs that dealt with defense or foreign policy. For example, foreign aid and military construction both required annual authorizations during the early years of the Cold War. The next major use of temporary authorization was for defense procurement (Dawson 1962). In 1959, Congress attached an amendment to the Military Construction Authorization Act that required annual authorization for the procurement portion of the defense budget (Art 1985). Congress continued to expand the areas of the defense budget that required annual authorization until the early 1980s, when the last portion of the budget was subjected to annual authorization. During the 1960s and 1970s, the use of temporary authorization expanded much more quickly than it had in past decades (Schick 1983). This trend is difficult to quantify because it is hard to track the authorization status of all federal programs over time. One way we can examine this trend, however, is by following the authorization status of federal agencies over time. To assess authorization status, I examined agencies listed in The United States Government Manual and traced their authorization status through the United States Code10 and Statutes at Large, and assembled them in the Appendix: List of Agencies Analyzed in Chapter 4. Agencies were selected by consulting The United States Government Manual from 1992 to 2001. I examined each agency listed in all departments, as well as independent agencies. The list of agencies was also supplemented using data from Lewis (2003). The agencies were selected for two related purposes. First, I wanted to track the authorization status of new agencies over time. I determined the authorization status of all agencies created between 1947 and 1997.

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Because I am only interested in the congressional choice of authorization status, I listed only those agencies that Congress created through statute. Therefore, agencies created through executive reorganization are not included. For example, the EPA, which was created through executive reorganization in 1970, is not included in my list of agencies.11 Second, I wanted to see when Congress changed the authorization status of older agencies from permanent to temporary. To accomplish this goal, I traced all older agencies in existence in 1992 to see if their authorization status ever changed. This second set of agencies is used as a sample for my case studies in Chapters 5 and 6. Organizations located in the Executive Office of the President (EOP), legislative branch, or judicial branch were also not included in the analysis because the creation and oversight of these agencies is likely to differ substantially from other types of agencies. In addition, agencies situated in a cabinet department are not listed if they had the same authorization status as their parent department. I did, however, list agencies within cabinet departments if Congress created the agency before it was situated in that department, changed the authorization status of the agency after the creation of the department, or created the agency after the creation of the department. All agencies listed in the Government Manual were traced even if they were not listed in the Appendix.12 The table in the Appendix indicates the year the agency was created by Congress, its authorization status, and whether or not it was created from a previous agency. The date of an agency’s creation was coded based on how it was described in the Government Manual. Agencies whose names were changed but were largely carrying out the same functions for which they were created were given their original creation date. For example, the National Bureau of Standards (NBS), which was created in 1901 and renamed the National Institute of Standards and Technology (NIST) in 1988, was listed as having been created in 1901. In some cases, a new agency was actually transferred or created from a previous agency. Since it is not always easy to perfectly define a new agency, I traced whether an agency had a predecessor agency using the Government Manual’s “Appendix on Terminated and Transferred Agencies.” Any agency that was listed as a precursor or transferred in the Government Manual was coded as having been created from a previous agency. The Appendix table also lists several categories of authorization status. First, several agencies were given permanent authorization. These are agencies for which Congress did not include authorization language in the statute creating the agency or when Congress authorized “such sums as necessary,” and this status did not change during the period examined. Second, many agencies were given temporary authorization, especially those created after 1960. This might include an agency given a specific fiscal year authorization or a cap on the total authorization. Agencies were

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listed as having temporary authorization if the whole agency or a primary function of the agency was subject to temporary authorization. Finally, some agencies were originally permanent and were later changed to temporary. Among those shifted from permanent to temporary, only some included explicit language that said no appropriations were allowed unless explicitly authorized by law.13 I have indicated which agencies had their authorization status changed through this specific language.14 Table 4.1 lists changes in the use of temporary authorization from 1947 until 1997. The pattern we see shows that almost all federal agencies had permanent authorization status up until about 1960. However, around 1960 Congress began to place many more new agencies on temporary authorization. In the 1970s, we see that Congress began to put an even higher percentage of new agencies on temporary authorization. Additionally, Congress shifted many agencies from permanent to temporary authorization during this period of time as well. We see a decrease in the percentage of agencies put on temporary authorization in the 1990s. However, there are probably too few cases to know if this is a new trend or not. There also seems to be a pattern to types of agencies given permanent authorization after 1960. Agencies created from a previous agency were often given the same permanent status as the former agency. For example, Congress consolidated several agencies into the Substance Abuse and

Table 4.1 Trends in Use of Temporary Authorization for Federal Agencies

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Mental Health Services Agency in 1992 and did not change the agency to temporary authorization. Only a few agencies that were not created from a previous agency were given permanent status. Some of these agencies deal with loans, finance, or retirement funds, like the Office of Thrift Supervision, and are funded by fees and/or had working capital funds that finance their activities. We also see that many new agencies were given the authorization status of their parent department. For example, the Risk Management Agency was created in 1996 in the Department of Agriculture, and both have a permanent authorization. There is a definite trend of increased use of temporary authorization until the 1990s when Congress seems to have become more wary of its use as an oversight tool. This trend will be further substantiated empirically in subsequent chapters, but the trend matches the political arguments that were being made over time. The high point for the enthusiasm for temporary authorization seems to have occurred during the sunset reform movement in the late 1970s. Sunset reforms require the expiration of programs or agencies. The idea behind this reform was to require automatic review and discussion of the merits of a program’s continued existence. Proponents of sunset argued that many programs and agencies continued to live beyond a point where they were useful or needed (Lowi 1979). Common Cause pushed the sunset reform movement and several states adopted some version of it. During this period of time, the sunset idea also caught on in Congress. Several pieces of legislation were introduced that would have sunset most federal programs. In 1980, the Senate passed a sunset bill, but this was the furthest sunset reform legislation ever made it through Congress. The primary reasons sunset reform never passed were that it would have increased committee workload and interfered with authorizing committees’ jurisdictions (Aberbach 1990).15 Members did not think they had the time or the resources to review every program. Additionally, many of the proposals would have centralized review away from the authorization committees. Most members did not like the prospect of losing some control over their jurisdictions. Even before the sunset debate had run out of steam, the reauthorization process was running into problems. Congress was finding it more and more difficult to pass reauthorization legislation. Two structural changes occurred within Congress that made it extremely difficult to pass reauthorization legislation. First, the Budget Reform and Impoundment Control Act of 1974 changed the nature of the budget process in Congress. The new budget law added several steps to the process and required many more floor votes. As conflict over the budget increased in the 1980s, Congress found it increasingly difficult to find floor time to work on reauthorization bills. Second, the congressional system became more open and less committee-centered. Rank and file members were much less likely to

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defer to committees, which meant that committees had a harder time protecting their bills from amendments on the floor (Smith 1989). These changes obviously decreased the authorization committees’ incentives to bring reauthorization legislation to the floor. There have been several repercussions stemming from these changes in congressional structure. For one, Congress moved fewer agencies that had permanent authorization to temporary authorization after the 1970s. This can be seen clearly from the list of agencies in the Appendix. We can also see that Congress has had an increasingly difficult time passing reauthorization legislation (Solomon and Wolfensberger 1993), and this has resulted in a large fraction of the budget being left unauthorized. The difficulty of using the authorization process to change law has led members of Congress to increasingly use the appropriations process for that purpose. This has been done partly through continuing resolutions, but also by attaching riders to appropriations bills. The number of these riders began to increase dramatically in the 1970s (Schick 1983). In 1983, Congress changed the rules of the House to make it more difficult for people who were not on the appropriations committees to offer amendments limiting appropriations (Congressional Record 1983). The Republicans saw this as an attempt to keep them from offering riders to appropriations bills, but the Democrats argued that it was necessary to protect authorization committee jurisdiction.16 The Republicans further restricted the rules regarding limitation amendments when they took control of the House in 1995. The Republican majority added a new rule which gave precedence to motions by the majority leader to rise and report the bill over members offering limitation amendments. The impact was that the majority party could cut off limitation amendments from the minority through a majority vote of the House. Finally, the House Rules Committee began to play a more important role in appropriations bills because of unauthorized appropriations. House Appropriations subcommittee chairs found it increasingly difficult to bring their bills to the floor without a rule because they were subject to so many points of order. It was almost unheard of for appropriations bills to have rules 30 years ago, but in the last 10 to 15 years the practice has occurred with increasing frequency (Solomon and Wolfensberger 1993). The result of all these changes may have been to marginalize the authorization process and centralize the appropriations process in the hands of the majority party. CO NCL U S I ON At the beginning of this chapter, I set out to show that the risks involved in a committee’s choice between temporary and permanent authorization are similar in some ways to the theoretical risks coalitions face when they try to prevent coalitional and bureaucratic drift. Although the choice be-

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tween the two does not form a clear dichotomy between a program expiring or being permanent, I showed that the choice of temporary or permanent authorization has clear impacts on future choices. On the one hand, temporary authorization allows members to collect information, enforce bureaucratic compliance, and react to unanticipated consequences of legislation. On the other, temporary authorization creates costs and risks once the legislation comes back to Congress. Furthermore, I set out to trace the development and use of temporary authorization to provide some historical perspective. I found that the authorization process has changed significantly in the last 40 years. Congress began to use temporary authorization in the late 1950s, and also began to move agencies from permanent to temporary authorization in the 1960s. Then in the late 1970s and early 1980s, the movement toward temporary authorization slowed. The main reason for this change appears to be related to the fact that Congress had an increasingly difficult time passing reauthorization legislation. In the next chapter, I will discuss these trends in more detail. NO TES 1. The difference between the authorization and appropriations processes is mainly a distinction within Congress. Courts argue that Congress has the power to set and violate its own rules. If Congress chooses to violate its own rules and pass spending authority outside of the normal two-step process, then the courts have found that it still carries the force of law (General Accounting Office 1992; Fisher 1979). Still, to understand how spending policy works, we have to understand the internal rules and workings of Congress. 2. See Stewart (1989) for a discussion of the development of the authorizationappropriation dichotomy and how this process evolved over time. 3. The process of renewing expired temporary authorizations is known as reauthorization. 4. One exception to this rule is for public works projects that have already begun. 5. A point of order is a request by someone from the floor to rule the current proposal out of order because it violates some rule of the house. 6. See, for example, Congressional Record 1994a, H4259. 7. See Congressional Record 1993a, H7228-7231. 8. See Congressional Record 1994b, H3026. 9. The Joint Economic Committee, which was created in 1946, was put on temporary authorization, but this language was later removed (Brown 1996, 79). 10. Both the Government Printing Office’s United States Code and the Legal Information Institute’s electronic version at http://www4.law.cornell.edu/ uscode/ were consulted. 11. Congress did put EPA research and development funding on temporary authorization in 1976 (U.S. Congress 1976).

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12. Offices in the Executive Office of the President, quasi-official agencies, and temporary boards and commissions are also excluded. 13. An example of this language can be seen for the United States International Trade Commission (USITC) and states: “For the fiscal year beginning October 1, 1976, and each fiscal year thereafter, there are authorized to be appropriated to the Commission only such sums as may hereafter be provided by law” (U.S. Congress 1974, 2075). 14. There were several other agencies for which Congress originally provided permanent authorization, but later began to reauthorize even though they did not include specific language requiring authorization. Some of these agencies listed in the Appendix include the Federal Communications Commission, the National Institutes of Health, and the Patent and Trademark Office. Although these types of changes are important, I am focusing on those agencies for which Congress inserted specific language requiring authorization. The statutes creating these agencies provide much more clear-cut evidence of congressional intent. 15. The sunset reform movement still lingers on. In almost every Congress, bills are introduced that would sunset federal agencies. In the 106th Congress, H.R. 2128 would require reauthorization of federal agencies every 12 years (U.S. House 1999). 16. See Congressional Record 1983, H1440. .

CHAPTER 5

Case Studies of the Choice to Use Temporary Authorization

This chapter provides the first step in testing my hypotheses by systematically examining several case studies. A case study approach has several advantages. First, the authorization process is complex and case studies will provide a more contextualized understanding of how it operates. Second, my model assumes that members of Congress respond to the incentives provided by the institutional structure within Congress. However, I argued that this structure has changed over the last 40 years, and may have altered the incentives for procedural choice. Case studies allow us to examine agencies over time to see how Congress has responded to changes in the larger structure. Finally, with a case study approach we can examine the actual choices made by members of Congress. In Chapter 7, I use quantitative methods to examine how institutional arrangements differ across legislative agreements. This method provides a powerful tool to test hypotheses, but removes us a step from the decision-making calculations of members of Congress. Conversely, case studies provide a perspective closer to the actual choices members of Congress make. Testing causal relationships with qualitative methods presents several challenges, but researchers can reduce the impact of these problems by being attentive to their research design (King, Keohane, and Verba 1994). An important aspect of this approach is to choose cases in a way that allows for valid inferences. To choose the cases in this study, I use a method similar to the “indirect method of difference” (Ragin 1987). Under this approach, cases that contain the phenomenon of interest (i.e., temporary authorization) are compared to see if there is a common factor, present or absent, that explains its occurrence. Then, cases that do not

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contain the phenomenon of interest are compared to see if the factor is present or absent. The universe of potential cases that I choose from are agencies listed in the Appendix. To select cases from this pool, I categorized the agencies along two dimensions that are listed in Table 5.1. These dimensions are the year that agency was created by Congress and its authorization status. The normal choice for Congress was to create permanent agencies, Type 1, before the 1960s, and to create temporary agencies, Types 2 and 4, after the 1960s. My choice of cases will focus on those agencies that go against the normal choices of their era, Types 2 and 3, which are presented in top right and bottom left quadrants of Table 5.1. These two types consist of agencies that Congress created before the 1960s, but then moved to temporary authorization, and agencies created after the 1960s that were given permanent authorization. The reason for choosing these two types of agencies is that in both instances Congress made a choice that appears to deviate from the normal pattern of institutional choice. In both cases, we would expect that some stimulus or incentive led to that choice. If my hypotheses in Chapter 3 are correct, then we should see a consistent pattern of stimuli for these two types of agencies. My choice to study these particular agencies provides important information, but there are tradeoffs to approaching the question in this manner. King, Keohane, and Verba (1994) argue that it is preferable to choose cases based on variation across independent variables to avoid selection bias. If we choose cases based on the dependent variable, then we are more likely to choose those that fit our arguments. In this instance, the problem of selecting on the independent variable is that Congress often chooses

Table 5.1 Four Categories of Agencies by Age and Authorization Status

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authorization status with very little debate. For the vast majority of cases, it would be impossible to see what motivated members of Congress. However, by choosing those cases that go against the grain, we can see the forces that lead Congress to choose between permanent and temporary authorization at work. This case selection allows for a better understanding of actual decision making. I form my investigation around questions that relate to the hypotheses developed in Chapter 3. I also investigate the alternative explanation provided in Chapter 4, which states that the primary reason for the movement to temporary authorization was conflict between authorization committees and the House Appropriations Committee. The following questions guided my analysis of the agencies I examine: • How much uncertainty existed among committee members regarding the effects of agency decision making? Did the committee delegate new authority to the agency? Was a new type of issue with which the committee was unfamiliar involved? Did the authorization committee have reason to believe that the agency would not implement policy according to congressional intent? • How much conflict existed at key decision points? Did a great deal of conflict exist on the authorization committee? Did members of the committee take alternative proposals to the floor? Was there conflict at other key decision points? • How much conflict existed between the committee and the president over agency policy making? Was the committee concerned about presidential influence in the agency decision making? To what extent is the president an advocate of the program? • How much conflict existed between the authorization and Appropriations Committees?

To assess these questions, I reviewed the legislative history of each agency by examining the U.S. Code, House and Senate Committee Reports, the Congressional Record, the Library of Congress’s Thomas database, the CQ Almanac, the Congressional Quarterly Weekly Report, and well-known histories of these legislative acts. In many cases, the legislative history of these agencies has been extensively examined. My goal was not to find a unique interpretation of events, but instead to take commonly understood interpretations across the agencies and see if they form a pattern consistent with my hypotheses. The rest of the chapter is divided into three sections. First, I review all agencies listed in Table 5.2 that Congress switched from permanent to temporary authorization. This list includes only the agencies for which Congress wrote specific language requiring reauthorization. We know in these cases that Congress was making a clear choice about authorization status. The only agency I do not discuss is NASA, which was created in 1958 and put on temporary authorization a year later. The decision to put

Table 5.2 Agencies That Congress Changed from Permanent to Temporary Authorization

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NASA on temporary authorization took place so close to the creation of the agency that we can consider it part of the creation of a new agency rather than changing an old agency’s authorization status. Second, I review the category of agencies created by Congress after 1960 and given explicit permanent authorization. In this section, I will not review all agencies that Congress gave permanent authorization, but instead will focus on OSHA and OSHRC. These agencies provide interesting cases because Congress delegated to them so much authority, and at first glance their authorization status appears to contradict my argument. Finally, I discuss my findings. CASES IN W HI C H C ONGR E S S C H A N G E D A N AG EN CY’ S A U T H OR I Z AT I O N S T AT U S F R O M TEMPORA RY T O P E R M A N E N T My goal in this section is to explain why Congress moved agencies from permanent to temporary authorization. My main expectation is that Congress changed agencies from permanent to temporary authorization due to increased costs of control during implementation and an increased likelihood of bureaucratic drift. My model predicts that two conditions would increase the costs ensuring bureaucratic compliance. First, some transformation in the decision-making environment increases congressional uncertainty. Second, an increase in conflict between Congress and the president increases the costs of control, especially when the president is an advocate for a program. Fisher’s (1983) examination of Congress’s use of annual authorization provides some support for these expectations. His analysis focuses primarily on annual authorizations and the reason that Congress adopted them. He examines new agencies and programs as well as older ones that were switched to temporary authorization. Fisher argues that Congress adopted annual authorizations for a diverse set of reasons. These reasons include Congress’s ability to provide more control for new programs, to regain control over old programs, and to adapt as conditions change from year to year. He also argues that competition between the Appropriations and authorization committees was important. My analysis differs in that I am only examining agencies that once had permanent authorization, but were later switched to temporary authorization. I am also interested in all lengths of temporary authorization, not just annual authorization. My findings are that Congress moved agencies to temporary authorization in large part because it was worried about control of the agency. One of the primary reasons for this concern was that Congress had delegated new power to the agency or the agency’s mission had expanded over time. Another reason was wariness of presidential influence on the agency’s decision-making, especially in the area

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of foreign and defense policy. I also found that Congress subjected some agencies to reauthorization after the agency’s reputation had been harmed by abuses of authority. These included withholding information from Congress, ignoring committee preferences when implementing policies, and engaging in activities contrary to congressional intent. Finally, there was some evidence that conflict between authorization committees and the Appropriations Committees contributed to an agency being moved to temporary authorization. However, this was never the primary reason for the change. The overwhelming evidence points to oversight as the primary reason for changing agencies to temporary authorization. Uncertainty over Policy Area Congressional uncertainty over implementation of policy was a common theme when authorization committees chose to move an agency to temporary authorization. In Chapter 3, I defined uncertainty as the degree to which members of Congress do not understand the connection between their policy choices and outcomes. Uncertainty may exist if a policy is complex or members have little experience to guide them in writing more specific policies. Since these agencies already existed and members had experience to draw on, then we should look for changes in the level of uncertainty over the policies implemented by the agency. I found two conditions that increased the level of uncertainty and led members of Congress to change an agency’s status. First, in some cases Congress increased the scope of the agency’s decision-making power and discretion. The effects of these changes on outcomes were not clear to the authorization committees and, in some cases, powerful interests expressed reservations about the increased authority. Second, some agencies were put on temporary authorization when they had become very large and the authorization committee no longer felt it had control over the agency. The FTC provides a good example of Congress using temporary authorization to check newly-delegated authority. The two primary functions of the FTC are to protect consumers from unfair or deceptive trade practices and to promote competition. However, until 1974, the FTC lacked the legal authority to pursue its mission in a vigorous way. Beginning in the 1960s, the consumer movement pushed to have the FTC’s statutory authority strengthened to protect consumers from unfair trade practices. In response to this movement, Congress passed the MagnusonMoss Act of 1974, which granted the FTC greatly expanded powers to protect consumers. The Magnuson-Moss Act expanded the scope of the FTC’s power in two areas. First, Title I allowed the FTC to set guidelines for companies that offered warranties for consumer products. Second, Title II enlarged the scope of the FTC’s powers by changing its mission from regulating

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deceptive practices “in commerce” to “in or affecting commerce.” This allowed the FTC to regulate deceptive practices “that although local in nature affect interstate commerce” (U.S. House 1974a). Congress also increased the FTC’s authority from simply regulating on a case-by-case basis to making industrywide rulings. In the debate over passage of this law, Title II attracted the most controversy and opposition. Business interests generally opposed increased FTC powers and worried that they would have few protections from arbitrary decisions. On the other hand, consumer groups strongly supported increased rule-making authority for the FTC. Consumer groups had argued for years that the FTC did not do a good job of protecting consumer interests, and they saw this legislation as a way to finally give the FTC the authority it needed to protect consumers from unfair and deceptive trade practices. These competing interests created conflicts within Congress. Members of the Senate Interstate Commerce Committee generally favored stronger FTC powers than did members of the House Interstate and Foreign Commerce Committee. The Senate passed a strong version of the bill in 1973 that greatly expanded FTC powers, and imposed few checks on its discretion. Conversely, members of the House Interstate and Foreign Commerce Committee were somewhat less sympathetic to consumer groups, and expressed concerns that the new FTC authority would lead to unnecessary harassment of business. This concern can be seen in several provisions added by the House Interstate and Foreign Commerce Committee to the Senate’s version of the bill. First, the House version limited the FTC’s ability to enforce compliance through the courts. FTC lawyers would not be allowed to go to court, but instead would have to continue to rely on the Department of Justice’s (DOJ) lawyers. Second, the House bill limited the FTC’s jurisdiction by restricting it from regulating unfair competition. The unfair competition restriction was particularly important because it would limit the ability of the FTC to enforce antitrust laws. A recent court decision had given the FTC this power, so this provision would have limited a power the FTC had recently acquired through the courts. Third, the House bill included procedural restraints on FTC rulemaking. For example, the FTC would be required to file an economic impact statement of its rules and allow affected parties to testify and crossexamine witnesses. Finally, the House Committee also included a provision that would require reauthorization every three years (CQ Almanac 1973, 406–410; 1974, 327–331). In this context, we can see temporary authorization as part of many changes added by the House to limit the FTC’s discretion in using its new authority. It provided a way for the House Interstate and Foreign Commerce Committee to delegate new authority to the FTC, but then to reign it back in if it offended powerful business interests.

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The Bureau of Land Management (BLM), like the FTC, was put on temporary authorization after BLM authority was expanded. Congress moved the BLM to temporary authorization status in the Federal Land Use and Management Act of 1976, which consolidated BLM authority and gave it more discretion in making land use decisions. The BLM’s primary responsibilities are to care for and manage federal lands. Traditionally, the BLM had a decentralized decision-making structure, and a reputation for being controlled by local ranching, timber, and mining interests (Durant 1992). However, beginning in the 1960s, environmental concerns became more salient in land-use decisions. The environmental movement led Congress to enact legislation in 1964 that moved the BLM toward a multi-use strategy, which meant that the agency manages federal lands in a way that balances the needs for recreation, industry, and conservation. Congress also created the Public Land Law Review Commission (PLLRC) to make recommendations for more permanent changes to the BLM land use policy. The PLLRC made its final report in 1970, and found that Federal Lands were in abysmal shape from overuse by business interests (Loomis 1993). It recommended that the agency be given permanent legislative authority and that public use legislation be consolidated. The Federal Land Use and Policy Act of 1976 did just that. Many old laws were deleted and the BLM was given a specific, statutory multi-use mission. However, BLM’s decision-making and land-use policies were still extremely important to the western states’ business interests. Many members of the House Interior Committee were concerned with how these decisions would affect mining and cattle interests in the western states (U.S. House 1976a). The two main issues of disagreement related to grazing fees and the withdrawal and reclassification of federal lands that disallowed industry use. To protect business interests, the House Interior Committee included a moratorium on increasing grazing fees and a legislative veto on withdrawals of public lands. Additionally, the House Interior Committee also added the temporary authorization provision. Although some members of the House and Senate committees opposed these restraints on the BLM’s power, the conference committee left them in and they were included in the law (CQ Almanac 1976, 182–88). As in the FTC case, temporary authorization was one of several provisions added to the legislation to check new authority given to the BLM. The House Interior Committee included temporary authorization and a legislative veto to reduce future enforcement costs if the BLM chose to use its new power in a way that put heavy burdens on powerful interests in the West. There was general agreement that a multi-use professional strategy was needed by the BLM, but granting this authority created uncer-

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tainty over what outcomes would eventually emerge. This sentiment was reflected by congressman Joe Skubitz (R-KS), a member of the House Interior Committee, on the House floor defending the bill against attacks that it protected business interests: The management and withdrawal of federal lands is . . . a matter which must not be left solely in the hands of an often unresponsive and unyielding bureaucracy. (as quoted in the CQ Almanac 1976, 186)

Temporary authorization allowed for intervention, therefore reducing fears that the BLM would not be responsive. The Securities and Exchange Commission (SEC) and the United States International Trade Commission (USITC) were also delegated new authority by Congress at the same time they were given temporary authorization status. Congress changed the SEC’s status in the Security Reform Act of 1975. James J. Needham, Commissioner of the New York Stock Exchange, called this law “ . . . the most substantial and significant reform of the federal securities laws in over 40 years” (CQ Almanac 1975, 112). This act gave the SEC more power to regulate stock exchanges and companies that provide information to stock exchanges, and provided the SEC with authority to encourage an integrated national securities market system (CQ Almanac 1975, 112–115). Once again, there was general agreement on the need for reform, but many people in the securities industry expressed concern about portions of the SEC’s new powers. Although the SEC’s original change to temporary authorization did not include language that specifically called for temporary authorization, this language was added in 1980 (U.S. Congress 1976). Congress changed the USITC to temporary status as part of the Trade Act of 1974. The USITC, formerly the Tariff Commission, is responsible for investigating harm done to industries due to opening markets under presidential trade negotiating authority. Congress thought the USITC needed to be more aggressive in protecting domestic industries from foreign imports. Accordingly, Congress changed the criteria that the USITC worked under in ruling on whether an industry was harmed by foreign competition from “the major cause” to “a substantial cause.” The USITC’s change in status is also consistent with Congress using temporary authorization to control regulatory agencies, especially when it had just broadened the agency’s authority (U.S. Senate 1977). A second cause of increased congressional uncertainty regarding how an agency will act occurs when an agency has become very large and has outgrown its original mandate (Fisher 1983). Congress often gives agencies vague mandates, and this can lead to an agency taking on different responsibilities than Congress intended. If an agency continues to grow

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in new directions, then the original authorization may provide inadequate direction for the agency’s activity. When an agency is small and does not engage in politically important activities, this does not pose much of a problem. However, in the cases discussed here, the agencies distributed large sums of money and were involved in politically important activities. In each instance, Congress wanted more control over the agency’s behavior. In many of these cases, the agency’s mission became more complex and technical over time and, consequently, more difficult for Congress to control through sporadic oversight. In many cases, Congress was also concerned that these agencies had large budgets that were not easily controlled by Congress. The Atomic Energy Commission’s (AEC) construction budget was one of the first items ever put on temporary authorization when Congress changed its status in 1954. The AEC fell within the jurisdiction of the Joint Committee on Atomic Energy (JCAE). The JCAE included members from both chambers and, because of interchamber rivalries, often had less authority over its policy area than other committees. The JCAE members saw temporary authorization as a way to increase their power and also limit the AEC’s discretion (Thomas 1956). The original Atomic Energy Act of 1947 gave the AEC unprecedented independence because of the Cold War and the secrecy involved in nuclear energy and weapons after World War II. However, the 1954 law brought the AEC into the “mainstream of American politics” (Hewlett and Holl 1989) by opening up atomic energy to private enterprise and using it as a tool of diplomacy in sharing nuclear technology for peaceful purposes. As the AEC’s mission changed from mostly serving national security purposes to promoting a domestic nuclear industry, members of the JCAE felt they should have more control over the AEC’s operations. Initially, Congress set only AEC’s construction budget on temporary authorization because it felt that portion should be subject to political control. Later, Congress subjected almost all functions involved in nuclear energy to annual authorization.1 These choices reflect Congress’s attempt to keep some measure of control over an agency as its missions evolved. Congress followed a similar pattern in seeking to control defense programs. Congress delegated a great deal of discretion over weapons development and purchases during the early years of the Cold War to allow the military to adjust its weapons systems to respond to new threats. For example, the authorization language would often just specify the total tonnage of ships the Navy could build, but the details of what types of ships, how they were built, or where they were built were left to the Navy. Additionally, Congress has traditionally given the Defense Department more discretion in reprogramming and transferring funds across accounts

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(Fisher 1975), and the Defense Department would often ignore congressional preferences by moving money from one account to another. Defense expenditures and activities had grown and become more complex in the Cold War period, and members of the House and Senate Armed Services Committees became increasingly frustrated at the negligible input they had in determining the types of weapons being built (Stephens 1971). Dawson (1962) argues that the appropriations process only allowed members of Congress to have a negative check and often led them to get bogged down in the details of the military budget. Members of the authorizing committees hoped temporary authorization or military procurement would allow them to have more of a say over larger strategic questions. They also hoped that a “thorough examination may reduce enormous costs of defense” and would help the Appropriations Committees in their annual review (U.S. House 1959, 38). In later years, the Armed Services Committees expanded the scope of annual authorization to all portions of procurement, research and development, and operations and maintenance accounts in the defense budget (Art 1985). The Armed Services Committees used reauthorization to state their priorities more clearly and to maintain control over how money was spent. For example, Congress inserted legislative vetoes over administrative reprogramming of funds (Stephens 1971). All of these actions can be seen as attempts by the House and Senate Armed Services Committees to gain more control of a program over which they felt they had little control at the time. Another example of an agency that over time had grown past its original mandate was the NSF. Congress created the NSF in 1950 and gave it an initial appropriation of $225,000. This original appropriation grew to almost one half billion dollars by 1968. The complex and dynamic nature of the science programs made it difficult for authorization committees to stay informed about the NSF’s activities. Also, the large amount of discretionary funds controlled by the NSF stimulated congressional interest in the way the money was distributed. Indeed, the Senate Labor and Public Welfare Committee expressed concern over NSF’s concentration of research dollars at a few elite universities (U.S. Senate 1968). Annual authorization provided a way for the committee to follow NSF activities and to ensure that the NSF money was spread across congressional districts (Fisher 1983). The Customs Service was also moved to periodic authorization because Congress felt the agency’s discretion and large budget necessitated more constant review by the authorization committees (U.S. House 1977). The Coast Guard was put on temporary authorization partly because it was the last military service whose construction budget was permanently authorized. However, the Coast Guard was also badly in need of more mod-

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ern equipment and its mission was open to some debate during this period. Congress thought that more congressional attention and control would help the Coast Guard solidify a mission and update its facilities (U.S. Senate 1963). Congress placed all of the above agencies on temporary authorization because the authorization committees that oversaw them became uncertain as to how the agencies were carrying out congressional policy. This happened because either they were delegated new authority, and members of Congress were unsure what impacts these policies would have, or the agency’s mission had become too large and complex for Congress to control under existing structures. Congress also wanted more control over how money was being spent. This was especially true with respect to large procurement and construction programs, which have distributional consequences of major importance to individual members. In all these cases, the authorization committees expressed reluctance to let the agency carry out its delegated power in an uncertain environment without some further check on its authority. Presidential Influence over Agency Implementation My second expectation is that the probability of Congress using temporary authorization increases when the president is seen as having too much influence on the agency. Veto points in the legislative process may protect agencies that do not follow congressional intent, especially if the president is an advocate of increased agency activity. In my review, I found that the authorization status of several agencies changed directly because of congressional concern over presidential interference in the agency’s activities. Many of these agencies involved defense or foreign policy, areas in which Congress has traditionally given the president more control over the bureaucracy’s activities. The first two examples of agencies that had their authorization status changed by Congress due to excessive presidential influence are the State Department and the United States Information Agency (USIA).2 Both agencies became involved in bitter battles over policy between the president and Congress during the Vietnam War. The State Department’s involvement in activities that Congress had expressly forbidden, like expanding the war in Laos, caused severe tensions between the two branches. The House Foreign Affairs and Senate Foreign Relations Committees believed that annual review of both the State Department and USIA would make them more responsive to the committees (U.S. Senate 1971). Congress included other provisions in the same bill to reassert some control over foreign policy. Although President Nixon signed the bill, he was not happy with the new restrictions, which he saw as an encroachment on his control over foreign policy. When signing the bill he stated:

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. . . the final product adds significant additional restrictions and limitations to those already in law which have hampered the efficient administration of foreign aid and the effective conduct of foreign affairs. (Nixon 1972, 166)

The president has also been given a great deal of discretion over trade policy, which became a concern to Congress in the 1970s when the trade deficit began to grow. One of the jobs of the USITC was to determine when imports were causing harm to domestic industries. As I discussed above, Congress increased the USITC authority in 1974 to help industries hurt by imports. However, this would have meant very little if there was undue presidential influence on the USITC’s decisions. The Senate Finance Committee stated in its report: The Committee strongly believes in the need to prevent the commission from being transformed into a partisan body or an agency dominated by the Executive Branch. For this reason many of the amendments offered in this bill with regard to the Commission are directed at strengthening its independence. (U.S. Senate 1974, 115)

These amendments to the president’s bill included lengthening of the terms of the commissioners, increasing the number of commissioners from six to seven, and allowing legislative vetoes of executive decisions. Some of these provisions were pulled out in the conference committee (CQ Almanac 1974, 553–52), but Congress’s desire to control executive influence on USITC’s decision making clearly existed. Annual authorization formed part of the structure used by Congress to reduce presidential influence. Congress applied temporary authorization to the SEC at least partly to minimize presidential influence. The House Interstate and Commerce Committee included provisions requiring the SEC to provide information to the committee as well as the president. For instance, the new law required that the SEC to submit its budget requests to Congress as well as the Office of Management and Budget (OMB), and forced the SEC to keep copies of all records. The last provision resulted from the SEC sending its records to another agency that was under another committee’s jurisdiction to avoid having them subpoenaed by the House Interstate and Foreign Commerce Committee (U.S. House 1974b). These types of actions made the House Interstate and Foreign Commerce Committee suspicious about the degree of SEC independence from the president. Periodic authorization provided another way for Congress to obtain information from the agency. The last agency involved in an effort by Congress to limit presidential control was the Maritime Administration. During the Johnson administration, the House Merchant Marine Committee perceived the agency and the maritime industry as under attack. For example, the Maritime Administration suggested to the Bureau of the Budget that it subsidize the

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building of 30 new ships, but the Bureau granted only 13 (U.S. House 1966). The Committee and the maritime industry were also concerned about the Johnson administration’s attempt to move the Maritime Administration to the new Department of Transportation. The committee saw periodic authorization as a way to protect the Maritime Administration, and to get better information about what they saw as the agency’s true needs (CQ Almanac 1967, 825–29). Congress changed the authorization status of all of these agencies at least partly because of congressional concern over presidential influence. In most cases, the president was an advocate of increased action by the agency, especially with respect to agencies that dealt with foreign policy. The Central Intelligence Agency (CIA) and the Defense Department could also be added to this category. These all provide examples of agencies in which the president was an advocate of increased agency activity. However, there have been examples of agencies placed on temporary authorization to protect these agencies from presidential attempts to limit their activities. The Maritime Administration and the USITC are two examples of this type. In these cases, temporary authorization appears to be part of Congress’s attempt to obtain information from the agency that was not filtered through the OMB. Agencies with Damaged Reputations A third condition that led to uncertainty over implementation is when Congress loses trust in agency officials. In some cases, Congress found out the agency had engaged in activities without informing Congress. In other cases, the agency was not responsive to congressional requests for information. The common thread was that these agencies’ reputations had been damaged with their authorization committees, and they were therefore put on a shorter leash. The State Department and the USIA both suffered a blow to their reputations in fights over policy with Congress. The Senate expressed deep concern and anger that the State Department and the USIA were unresponsive to the committee’s request for information, and this led directly to both of these agencies being put on temporary authorization. Members of the Senate Foreign Relations Committee felt that they did not have these problems with the Peace Corps and the Arms Control and Disarmament Agency because they were subject to reauthorization (U.S. Senate 1971). The CIA and other intelligence agencies were also given temporary authorization due to a perception that they were out of control and that Congress had inadequate knowledge of their activities (CQ Almanac 1977, 379–80). Both houses of Congress put the CIA on temporary authorization as part of several reforms that gave Congress more control over intelligence activities. These changes were not put into law, but instead into the

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rules of both houses. These rules were established at the same time that both the House and Senate created intelligence committees. These reforms resulted from the highly publicized Church Committee Investigations that uncovered several questionable CIA activities about which Congress was in the dark (CQ Almanac 1975, 387–413). The Department of Justice (DOJ) also became embroiled in conflicts with Congress, and was put on temporary authorization in 1976 (U.S. House 1976b). The House and Senate Judiciary Committees took this action because several abuses of monitoring private citizens by the Federal Bureau of Investigation (FBI) had come to light and Congress was upset with the agency’s performance in handling issues related to Watergate (Fisher 1983; Rubin 1988; Sundquist 1981). Congress no longer felt that it could trust the agency to be responsive or to provide honest information. The NBS, which later became the NIST, offers a slightly different example. Although the agency was not involved in a scandal or accused of keeping information from Congress, there was a perception that it was an inept agency. Congress put the NBS on temporary authorization in 1978 because of concerns over its poor performance. Members of the Senate Committee on Commerce, Science, and Transportation stated in their report that they were concerned about the lack of oversight the Bureau received, and that “a number of concerns have been expressed about the state of health of the Bureau” (U.S. Senate 1978a). The committee thought that periodic authorization would lead to more careful oversight. All of these agencies had damaged their reputations with Congress and their authorizing committee, and, therefore, became subject to increased scrutiny. Members of Congress do not have time to do in-depth oversight of every agency every year. They may be able to reduce their workload by relying on the reputations of the officials that work at the agency. Conversely, if the agency appears to have developed a culture that has led it to obfuscate and ignore Congress, as clearly was the case with the FBI and CIA, then Congress will put its resources into increased scrutiny of the agency’s activities. Having to testify every year before a skeptical committee is a position that most agency personnel would like to avoid, which is why they usually protect their reputations (Fenno 1966). However, in those cases in which they do not, the authorizing committee’s uncertainty of its control over the agency goes up and, accordingly, it will develop more interventionist governance structures. Conflict with Appropriations Committees Conflict with the House and Senate Appropriations Committees did play a role in some of the cases in which Congress moved an agency to temporary authorization. For example, the JCAE had conflicts with the House and Senate Appropriations Committees because it had cut presi-

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dential budget requests deeper than the Appropriations Committees wanted. This concern can be seen in the JCAE’s attempt to gain access to the two Appropriations Committees as ex officio members for debates on the AEC’s budget. The Senate went along with this proposal, but the House Appropriations Committee refused to let the JCAE members have access to its hearings. Similarly, the Armed Services Committees may have been as concerned with the Appropriations Committees’ encroachment on their turf as they were with the executive’s excessive discretion (Dawson 1962; Gordon 1961; Stephens 1971). Conflict between authorization and the Appropriations Committees has always existed and it clearly played some role in the movement to put some agencies on temporary authorization. This is especially true when the authorization committee was acting as an advocate for an agency against appropriations cuts. However, for two reasons it is clear that conflict between the authorization and Appropriations Committees was not the sole motivation for the movement to temporary authorization. First, in many cases it was the Senate authorization committee with jurisdiction that strongly supported moving an agency to temporary authorization. In some cases, the very Senators who sat on the authorization committee also sat on the Senate Appropriations Committee. This was clearly the case with respect to the defense budget (Dawson 1962). Senator John Stennis was one of the first members to propose that the procurement portion of the defense budget be subject to reauthorization, and he also was a member of the Appropriations Committee at that time. The fact that he sat on both committees is reason to believe that he saw this as more than just a power grab from the Senate Appropriations Committee. Similarly, Senator Magnuson, from his position on the Senate Interstate Commerce Committee, played a large role in putting many of these agencies on temporary authorization, but he was also a chair of a Senate Appropriations subcommittee. Clearly, members of Congress had goals besides protecting their turf from the Appropriations Committees when they chose to support temporary authorization. Secondly, in every case in which an agency was moved to temporary authorization, the House and Senate authorization committees expressed a great deal of concern over the way the agency would or did implement its programs. In fact, in some cases, such as the decisions to put the State and Justice Departments on temporary authorizations, the evidence is overwhelming that Congress intended to use temporary authorization as a way to control the agency. When appropriations-authorization conflict does appear to be important, other oversight factors also seemed to have played a large role. Therefore, although appropriations conflict is a factor in the movement of agencies to temporary authorization, it does not appear to affect my argument that temporary authorization is used to improve the oversight and control of agencies.

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CASES IN W HI C H C ONGR E S S G AV E N E W AG EN CIE S P E R M A N E N T A U T HO R I Z AT I O N In this section, I examine the Type 3 agencies listed in Table 5.1 which were created by Congress after 1960 and given permanent authorization. Congress required reauthorization for a larger percentage of agencies after 1960, which is consistent with arguments that Congress began to reassert its authority over administrative decisions during this period (Schick 1983; Sundquist 1981). The fact that Congress gave permanent authorizations to a few agencies suggests that the forces surrounding their creation differed from those surrounding other agencies. In some cases, identifying these forces is not difficult. For example, the Pension and Welfare Benefits Administration receives its funds from fees. Most federal agencies that deal with loans or credit collect fees and have permanent authorization. Other new agencies were simply reconstituted from older agencies, and these agencies were generally given the authorization status of their previous organizations. Federal Departments that were created during this period—Housing and Urban Development, the Department of Transportation, and the Department of Education—are examples of these reorganized agencies. Instead of reviewing all these agencies, some of which may have been given permanent authorization for reasons unrelated to my argument, I will focus on two agencies created at the same time: the OSHA and the OSHRC. These agencies provide an interesting case because of the broad delegation given to OSHA in the Occupational Safety and Health Act of 1970. The 1970 law called for the OSHA to set standards for workplace health and safety with little regard to the cost it would have on business. Congress had little experience with designing regulatory structures for occupational safety and health, and therefore, the uncertainties of policy outcomes and impacts on important groups were quite high.3 My argument predicts that Congress should develop institutional structures that allow congressional intervention when uncertainty is high. On the other hand, my model also predicts that conflict and risk of coalitional drift create incentives to make future intervention more difficult. Accordingly, we would expect conflict and the risk of coalitional drift to have been very high if Congress made intervention more difficult. In fact, this seems to be the case. The creation of OSHA took three years of congressional battles and split Congress along partisan and ideological lines. Jacob Javits (R-NY), the Senator whose compromise proposal became law, called it the “most bitter labor-management political fight in years” (U.S. Senate 1970). Moe (1989) argues that labor supporters in Congress were able to get most of what they wanted out of the bill, but worried that they could lose future battles, so they insulated the agency from political pressure. Of course, this insulation meant that labor groups and

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their Democratic supporters would have less ability to direct the agency. As I will show in this section, however, the deep divisions within Congress, and especially in the House Committee on Education and Labor, would have made intervention much too dangerous and costly for this coalition. Conflicts over the Creation of OSHA The Johnson administration first brought the idea of an agency to regulate workplace health and safety to the political agenda. Johnson wanted to find a post–civil rights issue to promote, and social regulation fit his needs (Noble 1986). In 1968, Johnson proposed legislation that would give the Department of Labor (DOL) the ability to set national standards for workplace health and safety (CQ Almanac 1968, 675–78). However, Johnson’s bill was vague about how these standards would be set, and both the broad mandate to set standards and placing the agency in the DOL provoked anxiety among business groups. The House Education and Labor Committee reported a bill that made several changes to Johnson’s proposal based on the concerns of groups testifying before the committee. For one, the reported bill took away the power of the Secretary of Labor to blacklist from federal contracts companies that did not comply with health and safety standards. The House Committee bill also changed Johnson’s request for a permanent authorization to a three-year authorization. The Education and Labor Committee did not change the part of the bill that Republicans and business groups found most objectionable, namely, the placement of the new authority in the DOL (U.S. House 1968). This issue would set the terms of the debate over workplace regulation for the next three years and create intense conflicts between labor and business groups. Opponents of giving the DOL power to promulgate rules made two main arguments against this provision. First, DOL did not have the expertise to handle workplace health and safety issues. Second, giving the DOL the power to promulgate and implement rules and the jurisdiction to hear appeals would violate the principle of separation of powers. Although these concerns may have been valid, the main reason that Republicans and business groups opposed placing the new agency in the DOL was because they feared the DOL’s decisions would be too favorable to labor. Noble (1986) argues that business groups thought that workplace violations could be used against management in collective bargaining agreements. Noble even cites an article in a Chamber of Commerce publication saying that former welfare recipients would be hired as DOL inspectors to wreak havoc on big business. To break the perceived monopoly of power by the DOL, the Republicans proposed that an independent commission be established that would promulgate rules, that the DOL be

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charged with enforcing those rules, and that the courts be given jurisdiction to hear appeals (U.S. House 1968). Neither proposal was ever offered on the floor after Johnson announced his decision not to run for president. Many people thought Nixon’s election in 1968 meant the end of occupational safety and health legislation, but Nixon surprised many people by offering his own proposal in 1969. Nixon saw political advantages to proposing his own legislation. For one, the idea of social regulation was very popular at the time, even among middle class voters (Moe 1989). Nixon had also relied on an election strategy that attracted blue-collar voters alienated from the Democratic party, and he was afraid of losing their support (Nobel 1986). Finally, the Democrats were going to introduce legislation anyway, and if Nixon wanted to shape the bill that came to his desk, he needed to make his own proposal. Nixon picked up on House Republicans’ idea of creating an independent agency that would be made up of presidential appointees (CQ Almanac 1969, 568–70). Nixon’s strategy was to divide power among different organizational entities and limit the ability of the DOL to play an active role. Additionally, Nixon’s proposal allowed the states to play a much larger role in setting standards. Many business groups still opposed regulation altogether, but found this proposal preferable to the Johnson Administration’s position. Conversely, labor fought the independent agency approach because it thought the new independent agency would eventually be captured by business interests. The House and Senate both took up the issue in 1969 and the confrontations over placement of the new agency became even more intense than they had been a year earlier. The House reported a bill out of a deeply divided Committee on Education and Labor in 1969. The Democrats pushed through legislation sponsored by Representative Dominick Daniels (D-NJ) that ignored Nixon’s request for an independent agency and gave sole authority to the DOL. Some liberals on the committee, like Phil Burton (D-CA), thought the bill did not go “far enough” in protecting workers (U.S. House 1970). Conversely, the Republicans refused to support a bill that gave sole power to set and enforce rules and to adjudicate cases to the DOL. Two minority reports were filed with the bill demonstrating the conflict within the committee. In one report, the Republicans express anger at being shut out of the process: In retrospect, the majority’s willingness to work out disputed points proved to be illusory. In sum, the committee had rejected the original Administration bill which had been carefully drafted to take account of the harsh but well deserved lessons learned from the 90th Congress’s experience with occupational safety and health legislation . . . The measure as reported by the Committee is unacceptable because in rejecting the concept of an independent board to set standards, the bill would create a monopoly of functions in the Secretary of Labor. (U.S. House 1970, 47)

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A second minority report expresses even more frustration: The situation has not been helped by the excessive emotion generated mostly by people with little knowledge or practical experience in these fields. This emotionalism has brought us to the verge of making this issue a partisan one. (U.S. House 1970, 53)

The bill went to the floor under a rule that allowed a substitute to be offered by Representatives Steiger (R-WI) and Sikes (D-FL). Steiger, a member of the Select Labor Subcommittee of the Committee on Education and Labor, joined forces with Sikes, who was added to attract conservative Southern members. The Steiger-Sikes substitute eliminated the role of the Secretary of Labor altogether by creating two independent boards: one board would set standards and another would hear appeals. Democrats on the committee considered supporting the Steiger-Sikes substitute because they did not think they could win on the floor, but labor groups, especially the United Steel Workers Union refused to endorse the compromise bill (Mendeloff 1979). The Steiger-Sikes substitute amendment did indeed pass 220–173, thereby replacing the committee bill (Congressional Record 1970, 38702). The battle then moved to the Senate, where similar conflicts erupted over the placement of the agency. The Senate Committee on Labor and Public Welfare passed a bill along party lines that would have placed the agency in the DOL. Jacob Javits, a member of the Senate Committee on Labor and Public Welfare, offered an alternative on the floor that passed 43–38. The Javits legislation allowed the Secretary of Labor to promulgate and enforce rules, but created an independent board to hear appeals. A conference committee was called to settle differences between the two houses, and most of the Senate version became law. The final law created OSHA and placed it within the DOL, and also created the three-person OSHRC to hear appeals. Although the bill was much stronger than what Nixon proposed, the strong public support for some type of legislation convinced him that it would be politically worse to veto it than to sign it (CQ Almanac 1970, 675–82; Noble 1986). Most agencies that Congress created during this time were given temporary authorization. The fact that OSHA and OSHCR diverge from this pattern suggests that the political forces that led to its creation were atypical. In my review of its creation, I found that an unusual level of conflict existed at key decision points over passage of this bill, especially on the House and Senate committees. Republican members of both committees went to the floor with an alternative bill and won in both cases. Under these circumstances, review of these agencies would have been extremely costly to the committees. The first bill that came out of Committee on Education and Labor in 1968 called for a three-year authorization. Every

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bill after that gave the agency permanent authorization. It is difficult to know why the committee later rejected temporary authorization, but the choice is consistent with my argument. It is quite possible that the committee proposed temporary authorization for the agency in 1968 because that was the typical configuration of the time, especially for regulatory agencies. However, after Nixon’s election later that year it probably became apparent that reauthorization and effective review of the agency were impossible given the level of conflict that existed among committee members. These conditions repeated themselves seven years later during the creation of the Mine Safety and Health Review Commission (MSHRC) and the transfer of the Mine Safety and Health Administration (MSHA) from the Department of Interior to the DOL (CQ Almanac 1977, 147–49). Opponents of these new agencies tried unsuccessfully to gut the bill moving the new agency when it came to the floor. One Senator, Harrison Schmitt (R-NM), offered an amendment that would sunset all the regulations issued by the new agency. These amendments were largely unsuccessful. However, neither agency was put on a temporary authorization. Since these agencies were so similar to OSHA and OSHCR, and the conflicts over their creation were so similar, it is striking that they were both given permanent authorization, while most agencies Congress created during this period were not. DISCUSS I O N The evidence presented in this chapter provides support for my hypotheses. I examined the reasons that Congress moved agencies from permanent to temporary authorization and found that it was largely because committee members perceived that it had become harder to control agencies’ implementation of policy created by Congress. In most of these cases, it was the main authorization committees that pushed for temporary authorization. I also examined why OSHA was given permanent authorization even though it was given extensive discretion by Congress. I found that both the House and Senate authorization committee had a hard time controlling the agenda on the floor, and reauthorization would surely have created as much difficulty. These cases indicate that Congress does indeed use temporary authorization to control bureaucratic implementation, but that it holds back when the risk of losing control within Congress becomes great. In this chapter, I examined the decision-making calculations used by members of Congress when making choices between different types of governance structures. Of course, this does not mean that there is a threshold of conflict or uncertainty that will lead Congress to choose one arrangement over another. For example, the FTC and OSHA shared

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important characteristics. Both agencies were delegated new regulatory authority, and conflict existed among committee members over these new powers. Why did Congress choose to move the FTC to temporary authorization but grant OSHA permanent authorization? One clear explanation is that the conflict over the creation of OSHA was of an altogether different magnitude than conflict over new FTC powers. However, we cannot precisely determine at what point conflict becomes so great that the committee will choose to use permanent authorization. As I argued in Chapter 3, members of Congress are boundedly rational and attempt to design procedures based on imperfect models of the world. This means that they will anticipate the impacts of their procedural choices, but they cannot perfectly predict the impacts of their choices, and those choices will result in better outcomes in some cases than in others. In the next chapter, I review the reauthorization history of the agencies in Table 5.1 to measure the success Congress has had passing reauthorization legislation. If members of Congress anticipate the usefulness of reauthorization based upon the degree of conflict within Congress, then we should see differences in the success of passing reauthorization legislation based upon how much conflict exists over the agency. NO TES 1. Congress created the Department of Energy in 1977 and subjected the entire agency to annual authorization. 2. The USIA was created through reorganization in 1948, and was given statutory authority in 1972 when it was put on temporary authorization. I include it in the discussion because it was put on temporary authorization at the same time as was the State Department. 3. Moe (1989) argues that both business and labor groups were dissatisfied with the resulting policy.

CHAPTER 6

Comparing the Success of Passing Reauthorization Legislation across Agencies

In this chapter, I examine the legislative history of agencies moved from permanent to temporary authorization. Specifically, I am interested in how successful Congress has been in passing reauthorization legislation after an agency has been changed to temporary status. Up to this point, my goal has been to explain the choice of authorization status, but my model also can help us understand how passage of reauthorization laws differs both across agencies and over time. I argued that conflict at key decision points creates decision-making and enforcement costs. Therefore, we would expect that Congress has had a harder time passing reauthorization legislation for agencies that have more conflict surrounding them at these decision points. We would also expect circumstances or events that increase conflict between these decision points would alter the relative cost of control and, therefore, the usefulness of temporary authorization. Since the committee is such an important part of the legislative process, we would expect that the degree of conflict within the committee with jurisdiction over the agency would be extremely important in that committee’s ability to pass its reauthorization legislation. Further, conflict between Congress and the president, and between the House and Senate, also raises difficulties for passing reauthorization legislation. My argument also assumes that the larger institutional structure creates incentives for action or inaction (North 1990). As floor politics have become more central to decision-making in both the House and the Senate (Smith 1989), the costs of passing all types of legislation have increased. As I discussed in Chapter 4, decreasing committee power on the floor

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should have made passing reauthorization legislation more difficult in recent years. To assess these two expectations, I examined whether the reauthorization legislation passed when the authorization expired for each agency listed in Table 6.1.1 I then developed three categories for these agencies

Table 6.1 Selected Agencies and the Success Congress Has Had Passing Their Reauthorization Legislation

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that attempt to assess the success Congress had in passing reauthorization legislation for each agency over time. Table 6.2 lists agencies according to three success categories that include very successful, somewhat successful, and unsuccessful. Very successful agencies have tended to pass every time they came up for reauthorization, especially in the first decade of their new authorization status. They also have reauthorization come up more frequently. Somewhat successful agencies often have not passed when their authorization expired, but most ran into trouble beginning in the 1980s. The unsuccessful category consists of those agencies that did not pass for several years at a time, and actually spent more time being unauthorized than authorized. These agencies also differ because they faced trouble soon after Congress moved them to temporary authorization. These are not precise categories, but they provide a framework that allows for a comparison of success across agencies. Once agencies have been differentiated by success, I can evaluate to what extent my expectations are met. Table 6.1 lists the main committee with jurisdiction over the agency, and a measure of committee conflict developed by Smith and Deering (1990). The authors measure conflict by asking participants in the process how much conflict exists in each committee’s environment. I will discuss measures and definitions of committee conflict in more detail in Chapter 7, but for my purposes here Smith and Deering’s measure suffices as a rough indicator of committee conflict.2 A clear pattern emerges in Table 6.1: we can see that the greater the conflict within the committee, the more difficulty the committee had passing reauthorization legislation. My second expectation is that reauthorization has become increasingly difficult to achieve over time. To assess this expectation, I listed the fiscal years each agency remained unauthorized in Table 6.2. Congress appears to have had more trouble reauthorizing these agencies over time. Figure 6.1 shows the number of agencies not reauthorized from 1976 to 2002 as a bar graph. Since the number of agencies not reauthorized in a given year may in part be a function of the number that come up for renewal in that year, I have also have calculated a three-year moving average of the trend. The moving average is made up of each year plus two previous years. The moving average is reflected in the line moving through the figure. We can see in that trend that the number not reauthorized goes up in the 1970s and levels off in the late 1980s. We then see another increasing trend in the early 1990s and leveling off in the late 1990s. Although the trend is not a clear linear progression, it appears that Congress has had an increasingly hard time reauthorizing these agencies over time. It also appears that periods of high conflict between the president and Congress in the 1980s and mid-1990s reinforced these trends. The early 1980s was also a period of split legislative control when the Democrats controlled the House and the Republicans the Senate.

Table 6.2 Selected Agencies and the Years They Were Not Authorized

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Figure 6.1 Number of Agencies Unauthorized 1976–2002

The reauthorization patterns across committees and over time are consistent with my model’s predictions. However, at this point we still do not know why these differences in passage rates exist. In the next part of this section, I examine in more detail why Congress has had success passing reauthorizations for some agencies and not for others. To assess legislative success, I had to review each agency’s legislative history. This was done by using Congressional Quarterly publications, searching the U.S. Code, and tracing legislative histories. In some cases, Congress may have inserted reauthorization language in an omnibus bill that may not have been identified in this search. However, my review should be an accurate reflection of the politics behind the struggle of passing reauthorization bills. VERY SUC C E S S F U L A GE N C I E S In the very successful category, the agencies include Defense, the Coast Guard, the CIA, and the State Department. Table 6.2 shows that, with only a few exceptions, reauthorizations for these agencies passed until the 1990s. These agencies share characteristics that probably contributed to congressional success in passing their reauthorization legislation. First, none of these agencies fall within the jurisdiction of a high-conflict committee. Second, these agencies relate to defense or foreign policy. In fact, much of the conflict that has surrounded the Defense, CIA, and StateDepart-

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ment reauthorizations centered on congressional conflict with the president over foreign policy issues. For example, the 1986 reauthorization for the CIA did not pass because of conflict over the use of money to support the Nicaraguan Contras (CQ Almanac 1984, 119). Similarly, Reagan vetoed the fiscal year 1989 defense authorization because he felt Congress underfunded the Strategic Defense Initiative and put too many limitations on presidential spending discretion (Towell 1988a, 2143): A compromise authorization bill eventually passed that gave both sides some of what they wanted (Towell 1988b, 2697). The Republican takeover of Congress in 1995 led to a long, drawn-out fight over reorganizing State Department agencies. Clinton vetoed a State Department reauthorization bill in 1996 that called for steep budget cuts and the consolidation of several foreign policy agencies. The standoff continued and the State Department’s authorization was not passed for four years in the 1990s while Clinton and Congress battled over consolidation of foreign policy agencies and paying off debts to the U.N. (CQ Almanac 1998, 16–17; Pomper 1998, 2915). A compromise was reached on the State Department authorization, but when Republicans inserted language banning money to international family planning organizations, Clinton vetoed the bill (CQ Almanac 1998, 16–17). The State Department consolidation was eventually passed as part of a consolidated appropriations bill (U.S. Congress 1998a). Here we see Congress attempting to use the authorization process to redirect the bureaucracy, but its ability was at least partly hampered by the inclusion of controversial amendments. All the agencies in this category were originally given annual authorizations, which increase the committee’s workload dramatically. Nevertheless, members of Congress have continued to pass this reauthorization legislation because this procedure provides one of their best opportunities to put a congressional stamp on foreign policy. Given members’ limited capacity to influence foreign policy, it makes sense that they would not surrender one of their opportunities by not passing the reauthorization laws. Indeed, I argued in Chapter 3 that conflict with the president is likely to lead to increased use of reauthorization, especially in areas like foreign policy in which the president acts as an advocate of increased activity. Although Congress has avoided major internal conflicts over these agencies, evidence does exist that passing reauthorization legislation has become harder in recent years. First, Congress has experimented with two-year authorizations for all of these agencies as a way to improve planning by the departments and reduce the floor burdens on both houses. Second, even with respect to agencies for which Congress has been successful in reauthorizing, we can see an increasing strain in maneuvering legislation through Congress. In the case of the Coast Guard, some of the conflict focused on controversial side issues and not the agency’s mission. In 1991 the House Merchant Marine Committee added

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a provision that would have repealed a tax on recreational boat users that passed in the 1990 budget agreement. The tax repeal provision was lifted and the reauthorization passed. However, in 1992 the bill died in the Senate because the two houses could not resolve the tax issue (CQ Almanac 1992, 202). There have been several years since then that Congress was unable to pass a Coast Guard reauthorization. SO MEWH AT S U C C E S S F U L A G E N C I E S The somewhat successful agencies were much more diverse in both the types of policies they dealt with and the reasons their reauthorization legislation had trouble passing. The agencies in the somewhat successful category included the NSF, the Maritime Administration, the NIST, the USITC, the Customs Service, and the SEC. This category was equally split between agencies whose jurisdictions fell into committees with low conflict and those that fell into committees with high conflict. As we would expect, the low- and high-conflict committees had very different reasons for their similar reauthorization patterns. The NSF, Maritime Administration, and NIST all reside in low-conflict committees and deal with issues that have a high distributive content. In fact, an explicit reason that the NSF and Maritime were put on temporary authorization was to give Congress more control over how and where money would be spent. According to my model, Congress should have had little trouble passing these reauthorization laws. Until the 1980s, this appears to be the case, but in the 1980s and 1990s these three agencies spent several years unauthorized. Reauthorization of these agencies appears either to have become bogged down in disputes over the agencies’ missions or mired in conflict from broader budget battles that spilled over into the agencies’ bills. Congress passed the NSF authorization every year through 1992 with the exceptions of 1981–1984 and 1987. Reauthorization bills passed the House every year from 1981–1984, but died on the Senate floor in each of those years because of jurisdictional dispute between two Senate committees. The Senate Commerce, Science, and Transportation Committee and the Labor and Human Resources Committee both claimed jurisdiction over parts of the NSF authorization and both reported a bill over those four years. In 1985, these two committees resolved their dispute by agreeing to share jurisdiction (“Senate Passes NSF Bill” 1985, 1965). A reauthorization bill failed to pass in 1987 when Congress began a major reorganization of the agency that it did not finish by the end of the year. However, Congress passed the NSF reauthorization in 1988 and lengthened the authorization from one year to five years (CQ Almanac 1988). Other disputes over NSF funding also occurred during this time, but for the most part they did not center on the central mission of the NSF.

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The Maritime Administration experienced a similar pattern of reauthorization fights. The Merchant Marine and Fisheries Committee was very protective of the shipping industry, and putting the Maritime Administration on temporary authorization was a way to protect that industry. This predisposition of the committee put it at odds with the Reagan administration over shipping subsidies. For example, Reagan’s fiscal year 1987 budget request included the elimination of loan guarantees to domestic ship builders and when Congress included these guarantees in the authorization bill as well as continuing support for state maritime schools, Reagan pocket vetoed it (CQ Almanac 1986, 292–93). In 1994 the House passed a bill reauthorizing the Maritime Administration and providing subsidies for U.S. shipbuilders to be paid through higher duties on incoming cargo. The bill died in the Senate when agriculture and coal interests objected to the duties (Legislative Summary 1994, 3163). When the Republicans eliminated the Merchant Marines and Fisheries Committee in 1995, jurisdiction for the Maritime Administration moved to the National Security Committee. A reauthorization bill was introduced in the House in 1995 (U.S. House 1995a) but was not voted on by the full House. Reauthorization for the agency was incorporated into the 1998 defense authorization bill and reauthorization has passed every year since as part of the defense authorization bill. The NIST (the NBS until 1988) has similar characteristics as the NSF, but it had a more turbulent reauthorization history than the NSF. Had NIST been put on temporary authorization before 1978,3 its authorization in the pre-Reagan period would probably have passed with little difficulty. However, NIST became embroiled in conflicts in the 1980s and 1990s over the appropriate role of government in promoting new technology in the marketplace. The Democratic Congress wanted the agency to promote research in technological development, while the Reagan Administration wanted to kill these types of programs because they thought this type of research should be done in the private sector (CQ Almanac 1988). A good example of this struggle occurred in 1984 when Reagan pocket vetoed the NBS reauthorization legislation (U.S. House 1984) because of what he saw as inappropriate promotion of robotics and automation technology (CQ Almanac 1984, 26-E). Congressional Democrats pushed their own vision of the agency and in 1988 renamed the agency the National Institute of Standards and Technology (U.S. Congress 1988a). They also created the Advanced Technology Program (ATP) to help promote innovative technologies in the private sector. The Clinton administration was a big supporter of the ATP and increased its budget during Clinton’s first two years in office. The Republican takeover led to renewed debate about whether promoting applied technology was an appropriate role of government. Robert Walker (R-PA), the new chair of the House Committee on Science, wanted to change the

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focus of science policy toward more basic research. Traditionally, the science committee had been one of the most low-conflict committees in the House, but in the 104th Congress the partisan battles over science policy became very bitter (Carney 1996, 1291). The House passed a bill providing for the elimination of the Advanced Technology Program (U.S. House 1996a) that deeply divided the House Committee on Science (U.S. House 1996b). This bill died in the Senate. Congress reauthorized the NIST in 1997 for two years (U.S. Congress 1998b). The Republicans were able to get the bill through by not trying to eliminate the ATP, but Democrats still argued that funding levels were too low (U.S. House 1997). Both the House and Senate have introduced bills to reauthorize the NIST since 1999, but none of them have passed. To summarize, the NIST, the NSF, and the Maritime Administration, the three agencies within the jurisdictions of low-conflict House committees, had more difficulty in the 1980s and 1990s than in previous years. However, conflict over these authorizations was generally contained to a few specific issues, and major fights did not break out among committee members on the floor. This was less true for the NIST than for the other two agencies, and this had a lot to do with fights over the mission of that agency. We can also see that changes in the level of internal committee conflict affected the ease of reauthorization. When the House Committee on Science became more ideological, its bills attracted controversy and were not able to get through the Senate. Conversely, when the Maritime Administration was included in the defense authorization bills, it attracted less controversy and passed easily. The three agencies in the somewhat successful categories that resided in high-conflict committees were the USITC, the Customs Service, and the SEC. I would have predicted that Congress would have had less success passing these agencies’ reauthorizations than was the case during this period. However, when we take a closer look at the reasons that Congress was able to pass reauthorization bills for these agencies, we see that special circumstances contributed to their success. Congress actually had more trouble passing reauthorization legislation for the Customs Service and the USITC than it would appear from looking at Tables 6.1 and 6.2. Both agencies come under the jurisdiction of the House Ways and Means Committee and both have authority over trade issues. Typically, the USITC and the Customs Service come up for reauthorization as a package that usually includes the Office of the Special Trade Representative as well. However, instead of passing the reauthorizations as stand-alone legislation, the trade agencies were often renewed as part of larger omnibus bills. For fiscal years 1985 and 1991–1992, these agencies were reauthorized as part of comprehensive trade legislation. Additionally, Congress passed the authorization legislation for fiscal years 1986–1988 in reconciliation legislation each year.4 This was probably not

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the preferred method of renewal by the Ways and Means Committee because the House Budget Committee has jurisdiction over reconciliation legislation. In fact, these agencies often did run into problems that were typical of what we would expect when highly controversial issues are raised. In 1988, Reagan vetoed an omnibus trade bill that contained the USITC and Custom Service’s reauthorization because it included a provision that required companies to notify their employees if they were going to close a plant (“White House Message,” 1988, 1476). The plant-closing amendment was highly salient and became an important issue early in the presidential campaign. The bill also contained several provisions that would have curtailed presidential power over the USITC. Representatives Gibbons (D-FL), the subcommittee chair, and Archer (R-TX), the minority ranking member, took opposing positions on the bill that reflected the split on the committee. Another example of controversial issues interfering with reauthorization bills occurred over Congress’s attempt to reorganize the Customs Service. The legislation would have allowed the electronic filing of customs information. This was controversial because some small brokers who handle duties for importers would have had to invest in equipment to compete (CQ Almanac 1992, 164). The original customs reforms died on the Senate floor because several senators attempted to use the legislation to introduce trade amendments. For example, Senator George Mitchell wanted to introduce an amendment that would eliminate preferences given to shoe imports from the Caribbean. Had the bill come to the Senate floor, several new trade amendments may have been added. When this legislation died, Dan Rostenkowski (D-IL) hijacked the Senate reauthorization bill and put in Customs Service reform (CQ Almanac 1992). This legislation passed the House, but never made it to a conference committee. Trade legislation is always dangerous to bring to the House or Senate floor because many members have an interest in offering amendments to protect their district’s interests. This is why trade legislation has traditionally come to the House floor under very restrictive rules. Inserting reauthorization legislation for these agencies in omnibus bills may have been a way to avoid these floor fights because trade and reconciliation bills usually come to the floor more protected from amendments than other types of legislation. However, this is hardly an ideal way to use reauthorization to direct the activities of an agency. Congress was not able to pass any reauthorization legislation for Customs or the USITC during the 1990s. The SEC was the final agency in the somewhat successful category. The SEC was not reauthorized for fiscal years 1984–1986. The House passed legislation (U.S. House 1983a) in 1983 reauthorizing the agency for two years, but this legislation died on the Senate floor (U.S. House 1983b). The SEC seemed to be falling into the same pattern as many other

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agencies in which conflict or a lack of time prevented the passage of reauthorization. However, the agency’s regulatory environment changed in the 1980s in a way that tended to reduce conflict among participants in the process. One problem that the SEC faced was the increasing number of insider trading scandals caused by a multiplying number of mergers. Congress passed legislation in 1983 and 1988 that gave the SEC increased enforcement powers to deal with these problems (U.S. Congress 1984; U.S. Congress 1988b). In October of 1987, the stock market crashed, which caused additional concern about the health of the securities industry. These events shifted the focus away from internal conflicts within Congress to the securities industry and using the SEC to solve these problems. Examining the reports from the House and Senate that accompanied the reauthorization legislation during this period, I found widespread support for the agency’s activities.5 The main difference between Democratic and Republican members was over the size of the SEC’s budget, which Democrats thought should be increased so the SEC could keep up with its added regulatory responsibilities. The increased interest in oversight can also be seen in Congress’s reluctance to expand the number of years of the SEC’s authorization, even though it was doing this for many other agencies during this time. In 1988, the Senate Report accompanying the legislation stated that: . . . the expanded responsibilities and workload of the commission as well as recurring revelations of improprieties in the financial markets cast doubt on the wisdom of making a three-year authorization in today’s environment. (U.S. Senate 1987b)

The SEC has run into more controversy during the past 10 years. In the early 1990s a fight broke out over the fees charged by the SEC (Taylor 1994, 2667). The SEC was collecting more money than it needed to fund its operations, and some members of Congress wanted to cut these fees. The fees issue became a greater problem once the Republicans took over Congress. Many Republicans wanted to eliminate these fees, but Democrats feared this would put the SEC’s funding into competition with other domestic spending. Congress did pass an SEC authorization bill in 1996 as part of a larger reform of the securities markets (Taylor 1996a, 3406). Although less conflict existed over the SEC in the 1980s, in recent years the agency has gotten tied up by issues like SEC fees, class action lawsuits by investors, and regulation of financial planners (Taylor 1996b, 1745). The three agencies overseen by high conflict committees in the somewhat successful category each had special circumstances that allowed Congress to keep their authorizations from lapsing. First, the Ways and Means Committee simply stuck the trade agencies’ authorizations into much larger bills. This is not an ideal method of control or oversight, and

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suggests that passing stand-alone legislation was either too time consuming or too difficult. Congress also was fairly successful in passing the SEC’s reauthorization. However, events within the securities industry made Congress more interested in its oversight function of the SEC, and there was widespread agreement on reform of the regulatory structure during this time. UN SUC C E S S F U L A GE N C I E S The unsuccessful agencies include the FTC, the BLM, and the DOJ. These agencies come under the jurisdiction of high- or medium-conflict committees in the House. Moreover, the original laws that led to temporary authorization for the FTC and BLM were at least somewhat controversial. Congress dealt with this controversy partly by deferring it to future reauthorization fights. Therefore, most of the unresolved issues in the original legislation continued to reappear. Reauthorization for the FTC passed only twice between 1974 and 1992, and in 1980 only after the agency was forced to shut down for a short time. The House Interstate and Foreign Commerce Committee originally insisted on temporary authorization to supervise the FTC’s new regulatory powers given to it in the Magnuson-Moss Act of 1974. As I argued in Chapter 5, Congress provided a way for the Committee to delegate new authority to the FTC, but then to rein it back in if necessary. Michael Pertschuk, the FTC chair, immediately began to use the FTC’s new authority in an aggressive way that threatened many powerful interests and created divisions among members of Congress. Pertschuk’s actions included investigations into advertising on children’s television programming; petitioning the Patent Office to remove trademarks, like Formica, which had become part of everyday use; and attempting to regulate trade and professional groups, like funeral home operators, lawyers, and doctors (Kovacic 1987). Business and trade groups, like the American Bar Association, the American Medical Association (AMA), the Chamber of Commerce, and the National Association of Manufactures, all lobbied vigorously to curtail the FTC’s aggressive proconsumer agenda. The FTC came up for reauthorization in 1977, which presented a perfect opportunity for enemies to restrict the agency’s behavior. Both the Senate and the House passed reauthorization bills, but the two versions were quite different. The Senate’s version would have required the FTC to send its budget requests to both Congress and the OMB to ensure Congress was receiving accurate information from the administration.6 The House included a legislative veto provision that would allow either house to veto an FTC rule. The veto provision was added as an amendment on the House floor by James Broyhill, who was the ranking minority member of the subcommittee with jurisdiction over the bill (CQ Almanac 1977, 554).

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The fact that this amendment was offered on the floor by the ranking member of the committee reveals the deep division on the committee over the FTC’s use of its new authority. The conference committee took out both the legislative veto and budget-reporting provisions, which led to the conference version being rejected on the floor of the House by a 146– 225 vote. The House floor killed a second conference bill later in the year (CQ Almanac 1978, 523–25). The bill came up again in 1979 and conflict continued to surround the agency. The House Committee on Interstate and Foreign Commerce bowed to the will of the House and added in the legislative veto (U.S. House 1979) but both the Senate and President Carter opposed this provision (CQ Almanac 1978, 523–25). Conflict among members of the House Interstate and Foreign Commerce Committee also existed. This divisiveness can clearly be seen in the report that accompanied the bill. Several proconsumer members filed a dissenting view in the committee report that expressed their objection to inclusion of a provision that barred the FTC from suing to invalidate a trademark, such as Formica, which had become a generically used term. Conversely, other members of the Committee filed an additional view that argued that the FTC had overstepped its authority by requiring used car dealers to supply warranties to consumers (U.S. House 1979). Congress kept the FTC going through continuing resolutions, but in 1980 the House Appropriations Committee refused to fund the agency until the authorization issue was resolved (CQ Almanac 1980). The agency shut down twice for short periods because the House, Senate, and President Carter could not come to a compromise. Carter finally agreed to accept a two-house legislative veto in a bill that authorized the agency through 1982 (U.S. Congress 1980a), but said he would challenge its constitutionality in court. When signing the bill, he stated: Section 21 provides for a two-house congressional veto for FTC rules. This provision is both unwise and unconstitutional. I am signing this bill despite the congressional veto provision because the very existence of this agency is at stake. (Carter 1980, 982)

At this time Congress removed the language from the law that required authorization for appropriations to take place. The agency still had a temporary authorization, but it appears that Congress did not want to play brinkmanship with the agency in the same way that it had done before. The conflict over the agency’s activities did not end, however, and many of the same points of contention kept reauthorization legislation from passing in later years.7 When the FTC’s authorization was set to expire in 1983, professional groups, such as the AMA, lobbied Congress to exempt professions from the FTC’s jurisdiction. Amendments that would have

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protected professions from the FTC were added by the House, but defenders of the FTC killed the bill in the Senate (CQ Almanac 1982, 347–49). Debate continued over the legislative veto as well. The House Rules Committee removed it from its version of the reauthorization bill,8 but the Energy and Commerce Committee (formerly the House Committee on Interstate and Foreign Commerce) left it in its version.9 These continued controversies led the FTC’s authorization to expire once again. Reauthorization legislation was introduced periodically after 1982, but never reached the floor of either house. By 1985, the main source of conflict was no longer the regulation of professions, but the FTC’s ability to regulate unfair practices in advertising. The Senate Commerce, Science, and Transportation Committee inserted a provision that would take away the FTC’s authority to regulate advertisers using the unfair trading practices provision of the law (U.S. Senate 1985). The House Energy and Commerce Committee did not have such a provision in its version of the reauthorization bill. The legislative veto was also still an issue. Both the Senate and House included a veto provision that would have to be signed by the president as a way of complying with the INS v. Chadha ruling. However the Senate’s version was stronger. These disagreements between the House and the Senate would keep the FTC from being reauthorized until 1994. Congress finally passed a reauthorization bill toward the end of the 103rd Congress when the Senate gave up trying to restrict the FTC from regulating advertisers (U.S. Congress 1994). The FTC has been examined extensively to assess the degree of congressional control of the bureaucracy. Weingast and Moran (1983) argue that FTC policymaking was responsive to ideological changes of the House and Senate subcommittees. Kovacic (1987) makes a similar argument.10 From this perspective, the committee median has disproportionate influence on changes in the bureaucracy’s behavior. My review here shows that the committee did not exercise as much control as Weingast and Moran’s study suggests. In fact, the original effort to insert a legislative veto came from outside the committee on the House floor. The House and Senate committee members tried to take this provision out in conference, but the floor voted down the conference bill. It would seem that internal committee differences severely compromised the committee majority’s ability to control the agency and the legislative policy area. The second agency in the unsuccessful category is the BLM, which was first put on temporary authorization in 1976. The BLM’s authorization expired in 1978, and Congress reauthorized the agency for another four years at that time (U.S. Congress 1978). The Federal Land Use and Management Act of 1976 required the executive branch to propose a four-year authorization plan every four years beginning in 1977. Congress passed legislation in response to this first plan in 1978, but substantially increased the president’s request from $359 million to $479 million in 1979. Members

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of the House Interior Committee blasted the president for his small request, but little other conflict existed over the bill among members of the committee and Congress (U.S. House 1978). In fact, the Senate Committee on Energy and Natural Resources called this reauthorization legislation a “prototype of the detailed and long-term oversight role that many advocated for congressional legislative committees in the ‘sunset’ concept.” (U.S. Senate 1978b). Congress passed a four-year authorization bill through 1982 without too much difficulty (U.S. Congress 1978). Future reauthorization efforts would not proceed so smoothly. The first problem occurred when the Department of Interior was slow in submitting its four-year authorization request that was due in 1980 (U.S. House 1989a). Confrontations over the BLM intensified in 1981 when President Reagan appointed James Watt as Secretary of the Interior. His extreme probusiness and development views strained the relations between the administration and Congress and created schisms within Congress itself (Durant 1992). Passing reauthorization legislation for the BLM under these circumstances proved impossible. The House Interior and Insular Affairs Committee was divided between proenvironment members, like the chair Moris Udall (D-AZ), and probusiness members. The majority Republicans in the Senate saw no need to overturn Secretary Watt’s policy. Regardless of these internal congressional conflicts, any reauthorization legislation that attempted to rein-in Watt would have been vetoed by Reagan. After the BLM’s authorization ran out in 1982, the House of Representatives continued to fund the agency by waiving points of order against unauthorized appropriations in the appropriations bills. The Senate introduced a four-year authorization bill in 1981 (U.S. Senate 1981a), but the bill never made it out of committee. Congress made little if any attempt to reauthorize the BLM while Reagan was in office. After eight years of allowing the Reagan administration to dominate policy toward public lands, Congress finally began to act. The House Committee on Interior and Insular Affairs reported a reauthorization bill in 1989 that would have reauthorized the BLM from 1990 to 1993. Additionally, the bill attempted to increase the protection of public lands. The House report accompanying the bill states: The Committee’s addition of Title II was prompted by concerns about numerous aspects of the manner in which the BLM has implemented FLPMA and shortcomings in the BLM’s management of the public lands. (U.S. House 1989a)

The bill attempted to increase the professionalism of the BLM by replacing political appointees in both Washington and local offices with career officials. Second, the bill would have put in several protections making it more difficult to ignore environmental impacts when planning the use of public lands (U.S. House 1989a). For example, the bill required the BLM to create “areas of critical environmental concern” and to support

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and increase the number and variety of wildlife and plant populations. Several members of the committee filed a dissenting view in the committee report that stated that the bill would “create costly and unnecessary requirements for the BLM that would reduce the opportunities for citizens to continue traditional uses of public lands that are compatible with good stewardship” (U.S. House 1989a). The bill passed the House, but several members of the Interior Committee fought it on the floor. The bill died because the Senate never acted upon it. A very similar bill was introduced by Representative Vento (R-MN) again in 1991 (U.S. House 1991a). This bill would have would have authorized appropriations from 1992 to 1996. Once again the bill passed the House Interior Committee and House floor, but with strong opposition from Republican members on the committee who wrote a dissenting opinion against the bill in the committee report (U.S. House 1991b). Representative McEwan (R-OH) summed up their position on the House floor, stating: . . . by introducing new bundles of red tape and regulations, this bill would further complicate various Federal procedures and frustrate Americans trying to fulfill a legitimate need in our society—be it for transportation, minerals, grazing lands, or whatever. (Congressional Record 1991, H5673)

The fight on the House floor escalated when Representative Synar (D-OK) proposed an amendment increasing grazing fees. This proposal cut across party lines and both western state Democratic and Republican members opposed it. Although the amendment was watered down, it passed and was incorporated into the bill (Davis 1991, 2068). When the bill moved to the Senate, the Senate Committee on Energy and Natural Resources pared the House bill of everything but the four-year reauthorization (U.S. Senate 1992). However, even this stripped-down version could not pass on the Senate floor. The House Interior and Insular Affairs Committee began work in 1993 on a bill similar to the ones it passed in 1989 and 1991, but this time with a Democrat in the White House. However, the Clinton administration urged it to hold off on revisions while the administration worked on its own reorganization of the agency (U.S. House 1993). The House Committee on Natural Resources ended up acting on a stripped-down reauthorization bill because the House Rules Committee did not protect the BLM against a point of order in the appropriations process and, therefore, the BLM’s funding had to be taken out of the Interior Appropriations bill (Congressional Record 1993b, H6605). This gave committee members an incentive to pass reauthorization because they no longer knew if BLM would be protected from points of order in future appropriations bills. The House passed a reauthorization bill stripped of everything except the renewal of the agency’s funding, but the Senate never acted on it.

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When the Democrats were in control, Congress was not able to use reauthorization to direct the activities of the BLM because of internal conflicts. Members of the House Interior and Insular Affairs Committee were extremely divided over land use policy, and these fights spilled onto the House floor. Moreover, conflicts between the House and Senate made passage of reauthorization legislation even less likely. This division made it impossible for the liberal members of the committee to redirect the agency away from what they saw as an overly friendly relationship with business interests. After the Republican takeover of Congress in 1995, the newly renamed Committee on Resources introduced its own authorization legislation. The Republicans seemed less interested in using reauthorization as an oversight tool, probably because they did not share the Democrats’ concerns with the agency’s performance. In fact, the new majority discussed moving the BLM back to permanent authorization, but this proposal did not go anywhere (U.S. House 1995b). Instead, Congress was able to attach a five-year reauthorization bill to the Omnibus Parks and Public Lands Management Act of 1996. Although this act did not have an easy journey through Congress, the bill contained enough popular district goodies to overcome the inherent conflict associated with the BLM and become law (McCutcheon 1996). The DOJ is the third agency in the unsuccessful category. Congress passed legislation in 1976 requiring annual authorization for the Justice Department starting in fiscal year 1979. Congress passed reauthorization legislation in 1978 and 1979, but the agency’s reauthorization never got all the way through Congress after that. Rubin (1988) examined the reauthorization history of the DOJ and explains nonpassage of reauthorization legislation in terms of the House and Senate committees losing interest in overseeing the agency. She found that the two committees initially used the reauthorization procedure to exert more influence over the agency. For example, in the first two reauthorization laws, Congress required the agency to report more precise statistical information on its activities, made detailed earmarks of spending, and limited the DOJ’s ability to reprogram funds. Rubin argues that over time law enforcement abuses became less salient because Congress had accomplished most of what it wanted. This argument, however, ignores the increasing conflict over the DOJ’s reauthorization bills on the floors of the House and Senate. The conflict arose from amendments offered on the Senate floor that would have prevented the DOJ from using the courts to enforce integration through busing (CQ Almanac 1981, 428–30). Carter vetoed a similar provision in an appropriations bill in 1980, and a threat of a veto essentially killed the authorization bill that year. Senator Lowell Weiker (R-CT) led filibusters to kill these antibussing amendments in 1981 and 1982, but cloture was invoked in both sessions. Although the antibussing plank passed in the

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Senate’s version of DOJ’s reauthorization bill, the House Judiciary Committee refused to act on it (U.S. Senate 1981b). Democrats on the House Judiciary Committee knew that if they brought the bill to the floor, the antibussing amendment would pass there as well. In response to the committee’s stalling, several House members asked the House Rules Committee to introduce a resolution that would have required the bill to go directly to the floor (CQ Almanac 1982). When this maneuver failed, Representative James Collins (R-TX) filed a discharge petition, but it did not receive the required 218 signatures. These types of frontal assaults on committee jurisdiction rarely take place in the House, which demonstrates the high level of conflict over this issue. Eventually, the Judiciary Committee reported its own bill and a Collins amendment restricting the DOJ from taking actions supporting bussing passed 265–122. The House and Senate could not reconcile these bills and passed a short-term authorization for the agency. These were not the only sensitive issues that became intertwined with the DOJ’s reauthorization. Members of both the House and Senate also attempted to add amendments on the floor dealing with such issues as immigration, the death penalty, and school prayer. The controversial environment surrounding the DOJ’s reauthorizations made managing the bill through Congress extremely time consuming and difficult. Fighting off attacks every year was not a situation that the authorization committees would want to continue. Congress continued to fund the DOJ through short-term authorizations in 1980 and 1981, but there were times when it appeared that the agency’s funding might temporarily be cut off (CQ Almanac 1981, 428–30). The DOJ became concerned about the uncertainty this was creating for its future and asked Congress to restore large parts of its budget to permanent authorization. The DOJ wrote to Congress in 1984: It is critical that this Department be provided a reasonable expectation of continuity for its basic programs. The current authorization process does not provide this expectation. On the contrary, it has created an environment which makes planning and program implementation most difficult; hence, the need for legislation which would take many basic noncontroversial authorities out of annual authorization. (U.S. Senate 1984)

The Senate responded by including in its reauthorization bill provisions that would allow permanent authorization for DOJ activities that did not require a high degree of oversight. For example, the bill would have made authority for protection of the Attorney General and the purchase of firearms permanent. However, temporary authorization would remain intact for expenses for collecting evidence, payment of rewards, and provisions of FBI undercover operations (U.S. Senate 1984). In other

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words, the Senators would continue to review those activities over which they wanted to exercise control. The permanent provisions became irrelevant because the 1984 bill did not pass. For the next several years both houses would introduce legislation reauthorizing the DOJ, but very few of these bills made it to the floor of either house. This changed in the 1990s when new scandals and abuses arose. Although the controversies surrounding the DOJ and FBI were highly partisan, both sides came to the conclusion that the DOJ needed closer oversight. In the 105th Congress, Henry Hyde (R-IL), the chair of the House Judiciary Committee, introduced an authorization bill for the DOJ. This bill was cosponsored by the ranking member, John Conyers (D-MI). The bill passed the House but never made it to the Senate floor. Congress finally passed a DOJ reauthorization in 2002. The bill included a few provisions to increase oversight of the FBI, such as giving the Inspector General more authority, but major changes were not included. However, both House and Senate committees want this to be a first step toward a new era in DOJ and FBI oversight (Dlouhy 2002). The analysis here suggests that this is unlikely. The political environment surrounding the DOJ is probably much too conflictual for meaningful oversight using the reauthorization process. DISCUSS I ON There are several points that can be made about the authorization histories of the agencies discussed in this chapter. First, the more conflict that surrounds the agency within Congress, the less successful Congress has been in passing reauthorization legislation. I found that conflict between many different decision points makes passing reauthorization legislation more difficult. For example, conflict between the House and Senate played a role in the failure of FTC reauthorization after 1980. Conflict between two Senate committees kept the NSF reauthorization from passing for over two years. A second point is that conflict among committee members seems to play an especially important role in reauthorization and creates a risk for committee control. The best example of this risk was the conflict over the FTC. Instead of the committee using temporary authorization as a club against the FTC, the opponents of the agency used it as a club against the majority of the committee. Similarly, the Democrats on the House Judiciary Committee lost control over their policy area while trying to pass the DOJ reauthorization. Although both committees were somewhat successful in fighting off these efforts, the struggles took up time and political capital. Moreover, these fights forced members to take stands on issues like bussing and consumer regulation that they probably would have liked to avoid.

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What does this tell us about committee autonomy and reauthorization? Clearly, the majority exercises some control over what happens once a reauthorization bill gets to the floor. We can see examples of the committee getting rolled, or losing votes, once it brings the bill to the floor. However, some of these committees simply chose not to pursue reauthorization if the costs of controlling it became too high. Another important point is that conflict between the president and Congress is important. Congress was able to use reauthorization somewhat effectively in its fight with the president when the president was an advocate of more activity. For example, Reagan vetoed the defense authorization bill in 1988, but Congress was able to force him to compromise on some funding issues. The Republicans were also able to use the State Department authorization, along with other procedural threats in the Senate, to force Clinton to compromise on consolidation of foreign policy agencies. Obviously, reauthorization does not give Congress an advantage over the president, but having this tool provides some leverage Congress would not have otherwise. The situation differs, however, when the president is not an advocate of more agency activity. When Congress and Reagan came into conflict over the BLM, Congress did not really try to use reauthorization to force the president to change implementation of the law. Also, the Merchant Marine Committee could not use reauthorization to effectively support the shipping industry. We also see that passing reauthorization legislation appears to have become more difficult over time. Changing patterns of behavior on the House and Senate floors clearly played a role in this change in success. One example is the use of the Coast Guard reauthorization to eliminate a tax in 1992. Fifteen years prior to that, it would have been extremely unlikely that members would violate committee jurisdiction norms by using reauthorization legislation to repeal a tax. Additionally, battles over the budget seem to have carried over to reauthorization bills. For example, relatively noncontroversial agencies, like the NSF, the Maritime Administration, and the NIST, suddenly became targets of budget cutters in the 1980s. Members of Congress also seem to have changed their view of temporary authorization, which has in turn affected the costs and benefits of its use. Until the 1980s, very few agencies or programs were left with unauthorized appropriations. Having an unauthorized agency was seen as extremely undesirable by the agency’s supporters and the president. Part of the reason was that Congress was reluctant to appropriate money that was unauthorized, and this put pressure on the president and agency supporters to compromise on the bill. This gave people who wanted to reform the FTC leverage in negotiating with liberals and President Carter. We can also see this in efforts to reauthorize the DOJ in 1981 and 1982.

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Both years Congress passed laws that authorized the DOJ for a very short period while they tried to compromise on the longer-term legislation. In recent years, however, unauthorized appropriations have become commonplace. The House no longer sees it as a major norm violation to waive points of order to unauthorized appropriations or to pass spending bills in continuing resolutions. This means that the risk of temporary authorization is less great than it used to be. Not passing reauthorization legislation is not likely to lead to a shutdown of the agency or program. This reduction in risk has also probably led to reauthorization becoming less valuable as a tool of controlling implementation for Congress. Put another way, part of what gave authorizing committees leverage was the threat to shut the agency down. This threat is probably less credible than it used to be. NO TES 1. The AEC was omitted because it was restructured by Congress and took on a larger mission over time, so tracking it over time would be comparing very different entities. 2. Smith and Deering measure the amount of conflict in the committee environment, while in Chapter 7 I argue that a better measure of conflict is the ideological dispersion on the committee. However, I show in Chapter 7 that these measures are very similar. I use the committee environment measure here because it provides a measure of conflict that stays roughly consistent over time. 3. The NBS did not include specific language requiring reauthorization until 1980. See Table 5.2. 4. These laws included P.L. 99–272, P.L. 99–509, and P.L. 100–203. 5. See the following House and Senate Reports: (U.S. House 1983b, 1989b; U.S. Senate 1987a; 1987b). 6. During this period Congress began to require many regulatory agencies to send their budget requests to Congress because they did not trust the OMB to provide accurate information. 7. One nonauthorization-related example was a discharge petition filed by James Broyhill to remove a concurrent resolution from the Energy and Commerce Committee disapproving an FTC rule relating to used car sales. Many other members of the committee cosponsored this petition (U.S. House 1981). 8. The legislative veto provision came under the jurisdiction of the House Rules Committee, so the bill was referred to this committee. 9. This issue became somewhat irrelevant when the Supreme Court ruled in 1983 that the legislative veto is unconstitutional in INS v. Chadha, 462 U.S. 919 (1983). 10. Moe (1987) argues that this view ignores the importance that the president had on changes in the FTC’s behavior.

CHAPTER 7

A Quantitative Assessment of Transaction Cost Theory

In this chapter, the hypotheses from Chapter 3 are tested by comparing laws that have temporary authorization and those that do not from a group of laws passed in the 100th and 101st Congresses. The sample of laws from these two Congresses is large and diverse enough to explain why Congress uses temporary authorization while controlling for other factors. If the argument laid out in Chapter 3 is correct, then we should see differences in the characteristics associated with enforcement costs between laws requiring temporary authorization and those that do not. The chapter contains four sections. First, I discuss the specific hypotheses from my model as well as alternative factors that may influence the choice to use temporary authorization. Second, I discuss how I will operationalize my variables as well as their reliability and validity. Third, I test these hypotheses using authorization laws passed in the 100th and 101st Congresses. Finally, I discuss the results. HYPO TH E S E S In Chapter 3, I argued that enacting coalitions design governance structures as a way to reduce enforcement costs of legislative agreements. However, members of Congress face a tradeoff when designing these structures between their ability to control implementation outcomes and the cost of maintaining coalitions. Therefore, an enacting coalition will use governance structures allowing intervention when the costs of controlling implementation are high, and it will not use them when the costs of maintaining coalitions are high. Temporary authorization is one example of

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a governance structure that allows for future review, and we would expect enacting coalitions to use it when the costs of controlling implementation are high and costs of maintaining coalitions are low. The main sources of enforcement costs for an enacting coalition are uncertainty and conflict. Coalitions are more likely to require temporary authorization when they are uncertain about the impact their legislation will have. This happens when the complexity of the legislation increases. They also become more uncertain about control of implementation, when they have less confidence that bureaucratic actors will follow the preferences of Congress. Members of Congress are less likely to use temporary authorization when there is a high degree of conflict between members of Congress. There are many different sources of conflict in a legislative setting, but my argument predicts that conflict at key decision points will produce the greatest costs for decision-making. Since committees are the center of decision-making in Congress and bear most of the decision-making costs, conflict among committee members will have the greatest impact on the relative costs of temporary authorization. However, conflict between other decision points also increases costs. These include conflict between different committees, between the committee and the floor, between the House and Senate, and between Congress and the president. I will also examine the resources available to overcome uncertainty. Congress has access to several information sources including the GAO, the Congressional Budget Office, and the Office of Technology Assessment. However, access to these sources of information does not vary much across legislation. The main information resource that does vary over legislative agreements is committee staff resources. Committee staff allow members of Congress to lower the cost of information when writing and reviewing legislation. We can see the importance that committee resources play by the fact that an important consideration weighing against sunset reforms was that the reforms would overload these resources. Although committee staff will likely play a prominent role in providing members information, the relationship between staff and reauthorization is not obvious. For example, more staff resources may allow committees to specify their intent clearly when legislation is first passed, which might actually make temporary authorization less likely. However, staff resources may also lower the costs of passing reauthorization legislation. I think staff resources will be more helpful in reauthorization, because it is much easier to react to the bureaucracy than to determine its actions ex ante. DATA A N D M E T HODS This section describes the data set and operationalizes the variables used to test the hypotheses from Chapter 3. The observations consist of

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all authorization laws passed in the 100th and 101st Congresses.1 Although information exists regarding the characteristics of legislation, few people have attempted to create measures of conflict and uncertainty across legislation. Some exceptions are Krehbiel (1991) and the research he has inspired (Dion and Huber 1996; Sinclair 1994). These studies have used databases of legislative history to analyze the impact of the characteristics of legislation on legislative rules. My own model uses many of the same measures as used in these other studies. The operationalization of all the variables and the expected directions are listed in Table 7.1. What follows is a discussion of each variable. Dependent Variables I use two dependent variables in this analysis. First, I operationalize the choice to use temporary authorization with a dummy variable of whether an agreement requires reauthorization or it does not. In the second analysis, I examine only those laws that require reauthorization, and measure the duration of the temporary authorization. Operationalizing the choice to use temporary authorization poses a few problems. One problem is that the proper unit of analysis is not obvious. Authorization committees pass laws authorizing both agencies and programs. Moreover, agencies, whether permanent or temporary, may implement both permanent and temporary programs. Therefore, when examining authorization status we could plausibly use legislation, agencies, or programs as the unit of analysis. My concern is not really authorization status, but the choice of authorization status by an enacting coalition. Therefore, we need to look at the package of legislation when Congress makes the choice. At the time of the choice, members of Congress calculate the relative costs of control of different institutional mechanisms. Members must calculate the costs of the whole package because it is this package of agreements that the enacting coalition forms around. The problem with using authorization legislation as the unit of analysis is that these laws often contain authorizations for many different programs and agencies. This pattern has increased in recent years, where legislation has been more likely to be put together in omnibus packages (Bach and Smith 1988). The use of omnibus packages makes it more likely that programs and agencies in the legislation will be unrelated to one another, or contain both temporary and permanent programs. The heterogeneity of programs within legislation creates some measurement ambiguities but these can be overcome. First, omnibus legislation tends to come up for reauthorization in the same package as that which originally passed. Although a law may contain many different programs, members of Congress will probably think of it as a package. Second, I found that legislation tends to contain either programs that require

Table 7.1 The Operationalization and Expected Direction of Variables Affecting the Choice to Use Temporary Authorization

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reauthorization or programs that do not. Although some legislation has a combination of both, in every case laws can be categorized as mostly temporary or mostly permanent. Each piece of legislation was coded as either temporary or permanent. This was done by examining each law and looking for authorization language. If no explicit authorization amount was given or no time limit was put on it, then the authorization was coded as permanent. If the legislation was explicitly given a fixed authorization for specified years, then it was coded as temporary. In some cases, the legislation had both permanent and temporary provisions. In these cases, a judgment was made whether the major funding emphasis of the bill was permanent or temporary. The second step was to code each temporary law for the number of years of its authorization. In most cases different programs in a law were given authorization for the same number of years. For those cases where the number of years were different, I made a judgment about the number of years for the major aspects of the bill. The second potential problem is that temporary and permanent are not discrete categories.2 The rules of the House and Senate require programs to be authorized before they can be appropriated, but the precedents of the House state that existing programs are considered authorized unless the authorization legislation specifically calls for renewal. For the most part, these laws do not have specific provisions requiring authorization, so their authorization status is more ambiguous. However, this does not mean that the authorization status of these laws does not affect the costs of coalition-building. When a program requires reauthorization, the expectation of the enacting coalition is that the program will come up for reauthorization. This means that members of Congress have committed their time in the future to review these programs. The more frequent the authorization, the more work they have created for themselves. The increased workload comes from acquiring information, building coalitions, and fighting off proposals from other members. There may also be costs to not trying to pass a reauthorization because the committee may end up looking weak and irrelevant. This seems to be the case of foreign aid programs, where the appropriators are seen to exercise more influence than the authorization committee. Under these circumstances, the bureaucrats will ignore the authorization committee. Therefore, the choice to set a time limit on the authorization sets up a governance structure that affects the enforcement costs in the future. My model relates directly to this point. As I argued in Chapter 3, no Congress can bind the hands of a Congress in the future. The majority can always skirt the rules of the house and pass anything it wants. Formal rules, therefore, are not the mechanism that restricts behavior; instead, the restrictions come from transaction costs. The rules are only followed to the extent that expectations and norms exist and members follow them.

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Even though these procedures do not necessarily lead to an end of legislation, they create expectations, and therefore transaction costs for the committee and enacting coalition. In the first analysis, each law was coded as either requiring reauthorization or being permanent. I coded the laws based on whether the most important aspects of the law required reauthorization.3 There are 328 pieces of legislation in my sample, and 199 have temporary authorizations. The second part of my analysis consists of only those laws that require reauthorization. The dependent variable is length of time the authorization is in effect. Independent Variables Conflict: The first hypothesized relationship is that conflict between decision points increases the costs of coalition-building and makes the use of temporary authorization less likely. There are many sources of conflict, including (1) conflict among committee members, (2) conflict between the committee and floor, (3) conflict between different committees, (4) conflict between the two houses, and (5) conflict between the president and Congress. I will explore all of these sources of conflict, but I will focus on conflict among committee members. Because committees oversee programs, they will assume most of the costs of reauthorization. Committee conflict among committee members creates costs, but there are many different ways to conceive of committee conflict. First, we could think about conflict specific to a piece of legislation, which is conflict not related to party or ideology. For example, regional conflict might exist over an issue like acid rain that cannot be completely attributed to ideological differences. Conflict that does not coincide with party or ideological preferences is probably the least common and the most uninteresting. Most conflict will correspond to ideology and will be consistent across legislation. Second, conflict could be related to differences in policy preferences among members of the committee. We could think of this type of conflict as conflict that is internal to the committee. As I discussed in Chapter 3, we would expect that this type of conflict would be somewhat consistent across policy issues, and, therefore, we can operationalize it as ideological distance between committee members. Finally, we could think of conflict as the conflict from outside the committee that affects its decision-making. This might include the salience of the policies over which the committee has jurisdiction. The key to developing a conflict theory is to focus on conflict that increases the costs of decision-making. My model assumes that internal conflict will have the most impact on committee decision-making costs. To a large extent, internal and external committee conflict are likely to overlap. However, the salience of the external environment will only have an impact on the costs of committee decision-making if there are differences in preferences between members

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on the committee. If committee members largely agree on an issue, then they may have to adapt their legislation to fit the external environment, but there will be little disagreement over how that is done. The case studies in Chapters 5 and 6 seem to bear this out. Agencies like the NSF and Maritime Administration faced a much more conflictual environment in the 1980s, but they were able to handle this environment because committee members largely agreed on policy. However, for those committees in which large disagreements existed over policy (i.e., OSHA, the BLM, FTC) the costs of passing legislation were extremely high. I have also included a measure of saliency to partly control for outside pressures on the committee. The saliency measure is the number of lines in a CQ Almanac story about each public law. Those laws that were not mentioned were coded as 0.4 Although both the House and Senate are important in determining legislative procedures, my model includes only characteristics within the House of Representatives. I focus on the House because it relates more directly to my theoretical concerns. Specifically, temporary authorization has more impact on decision-making in the House than in the Senate. In the Senate, more opportunities are already available under existing structures to allow intervention in the legislative process. The House has more restrictive amendment rules, which gives the floor majority fewer opportunities to change the status quo set by previous decisions. Temporary authorization allows new majorities to intervene in a way that is more difficult in its absence. The absence of the Senate from the model could lead to bias, however, if there are large differences in the amount of conflict within the two houses. The omission of the Senate should not be too serious a deficiency because the degree of conflict over legislation will coincide between the two houses in most cases. To control for those cases for which interbranch preferences differ, I have included a dummy variable for legislation that went to conference committee. Public laws that have high interbranch conflict usually go to a conference committee and, therefore, we can examine whether these laws differ from those that did not go to a conference committee. Two measures of committee conflict are presented in Table 7.2. The first column measures internal committee conflict by the spread of DWNominate scores of committees in the analysis (Poole and Rosenthal 2000). DW-Nominate scores calculate the ideology based on roll-call voting. In the first column, the standard deviations of DW-Nominate scores for each committee are listed from highest to lowest. The second column lists Smith and Deering’s (1990, 84) ranking of high, medium, or low conflict by the degree of conflict in the committee’s environment as perceived by participants. The measures of internal and environmental conflict overlap, but they do differ more for some committees than others. For example, the internal

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Table 7.2 Various Measures of Conflict for Committees in the House of Representatives

conflict of Education and Labor and of Armed Services were lower than Smith and Deering’s external conflict measure. On the other hand, District of Columbia and Interior committees both had higher internal conflict than external conflict. These differences make sense given the differences in the two types of conflict. Armed Services is generally considered a homogenous committee, but the external conflict surrounding defense policy is moderate. The District of Columbia Committee operates in a low conflict environment, but the membership was polarized between some of the most liberal and conservative members in the House. As I stated above, I expect that internal ideological conflict will be most important in determining the use of reauthorization, but I will assess if these differences in the measure of internal and external conflict have any impact on the model.

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The second source of conflict is conflict between committees. I operationalize this variable simply with the number of committees to which a bill was referred. Multiple referrals increase the costs of coalition-building (Collie and Cooper 1989), and are likely to make the use of temporary authorization less attractive. Conflict between the committee and the floor can also increase the costs of passing legislation. Krehbiel (1991) measures committee-floor conflict as the absolute difference between the committee and floor medians. Krehbiel might argue that the greater the difference between the committee and floor, the more likely the floor would want temporary authorization. However, Epstein and O’Halloran (1999) argue that greater differences between the floor and committee lead to greater delegation to the bureaucracy. This assumes that the floor decides the ultimate level of delegation. I assume that the committee has some discretion in deciding authorization status, and committee-floor conflict will increase costs and make temporary authorization less likely. The last source of conflict included in my model is between the president and Congress. As I suggested in Chapter 3, this variable’s impact will vary depending on whether or not the president is an advocate of a program. Measuring this variable in terms of ideological conflict will not work because the actors were largely fixed during the period covered in the analysis, and so no variation exists. More importantly, the dimension of conflict described in Chapter 3 was a desire for policy activity, which is not the same as ideological conflict. For example, conservatives want more defense activity and less domestic activity. Instead of using ideological conflict, I measured conflict with the president using a dummy variable for foreign policy legislation. Because the president usually has more influence on foreign policy than domestic policy, we would expect that Congress would be more likely to use reauthorization for foreign policy agencies. Uncertainty: I argued in Chapter 3 that the less members understand the impacts of laws, the more likely they would be to use temporary authorization. Several factors might contribute to members’ uncertainty about the relationship between legislation and outcomes. First, the more complex or technical the law, the more uncertain members will be about outcomes. Second, policies that attempt to change human behavior, as opposed to just purchasing goods, will probably create uncertainties. Finally, the sheer size of a piece of legislation might contribute to uncertainty because members will not be able to understand all aspects of the policy. This is similar to North’s (1990) notion of measuring desired attributes. These are extremely difficult characteristics to measure across legislation. Instead of separating these characteristics, I will try to capture the complexity of legislation in a much less precise way. To do this, I use Krehbiel’s (1991) operationalization of the scope of the law. Krehbiel op-

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erationalizes scope of a bill as the number of keywords in the Legi-Slate database. Keywords are the search terms under which a piece of legislation can be found in the database. The more keywords, the greater its scope, and therefore the greater its complexity. One potential problem with this measure is that the choice of what constitutes a keyword may be arbitrary and create biases that do not reflect complexity. I cannot assess the choice of keywords, but I can compare them to another database. If two databases choose keywords in similar ways, we can be more sure that keywords were not chosen arbitrarily. To assess the consistency of this measure across programs, I correlated the Legi-Slate keywords with the number of subject terms from Thomas, which is a similar database put together by the Library of Congress. The correlation between them was 0.91, suggesting a reliable measure. To assess the validity of my complexity measure, I looked at the programs that scored lowest and highest for number of keywords. These are listed in Table 7.3 and 7.4, respectively.5 The programs that score low appear to be fairly straightforward and not very complex. For example, many of them are simple changes in administrative or personnel policy. Table 7.3 Authorization Laws with the Fewest Number of Subject Headings in the 100th and 101st Congresses

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Table 7.4 Authorization Laws with the Highest Number of Subject Headings in the 100th and 101st Congresses

One law changes policy on overtime pay and another provides for payment of telecommunications equipment for the Senate Doorkeeper. Even the reauthorization bills of seemingly technical programs only contained a few pages and were straightforward authorization laws. Conversely, the laws that have a high number of keywords include some of the most complex issues Congress has dealt with in recent years. These issues include the defense authorization, regulating clean air, the crime bill, agriculture price supports, reforming regulation of the banking industry, and housing programs. Clearly, these are complex issues for which it is difficult for Congress to develop policy. The second way that I measure complexity is to simply use a dummy variable for legislation that deals with science and technology. Politicians will have a harder time writing specific legislation for areas that deal in complex technological issues. We would expect, therefore, that Congress would want to review these types of programs and require reauthorization.6 I also hypothesized that conflict and uncertainty would interact to create problems for coalition maintenance. When there is a high degree of conflict and ambiguous legislation, members of Congress should be less likely to use reauthorization. I test this hypothesis by including an interaction term, which is the number of keywords multiplied by committee conflict. RESULTS To analyze the choice to use temporary authorization, four different models were estimated using ordinary least squares and logistic regression. The results of these analyses are presented in Tables 7.5, 7.6, and 7.7. The models estimated include those with and without the interaction ef-

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Table 7.5 Logit Estimates of Authorization Status for all Authorization Laws Passed in the 100th and 101st Congresses

fects. I also estimated models for only those laws which were referred to a single committee. In those cases when a bill went to multiple committees or no committees at all I substituted the means of the standard deviations for all committees. This allows us to see the full impact that noncommittee variables have on the model. Many of the variables of interest were in the expected direction and

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Table 7.6 Logit Estimates of Authorization Status for Authorization Laws Referred to a Single Committee in the 100th and 101st Congresses

significant. Committee conflict was negative and significant in the models that did not contain the interaction effect. It was negative, but not significant, for the models with the interaction effect. Other conflict variables did not have as much impact on the choice to reauthorize. The multiple referral, committee-house difference, and foreign policy variables were all in the predicted directions, but none were significant. I used two variables to measure uncertainty, which included a measure of complexity and technology. The estimate for legislative complexity was in the intended positive direction and was significant for all models. The science and technology dummy variable was in the predicted direction and was significant for the full models, but not significant for only the bills with single referral.

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Table 7.7 Regression Estimates of Length of Authorization for Authorization Laws Passed in the 100th and 101st Congresses

I also hypothesized that there would be a negative interaction between conflict and uncertainty. The interaction term performed better in the single referral models, as we would expect. The interaction term was not significant in any of the models, but this may have to do with collinearity in the model when both the interaction term and the other variables are included. I assessed the degree of collinearity by examining the variance inflation factors for the ordinary least squares model. This was done using the VIF command in the statistical program Stata. The model without the interaction term showed only slight problems with the mean VIF slightly over 1. However, the model with the interaction term had much larger VIF factors. Collinearity may inflate the standard errors and make it difficult

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to assess whether the interaction term is significant This is a common problem with interaction terms. Unfortunately, this keeps us from assessing whether the interaction term is statistically significant. However, I will discuss the substantive significance below in more detail. The estimate of the staff resources variable was positive and significant, suggesting that committees with more staff are more likely to use reauthorization. To test the alternative hypothesis that staff resources explain the amount of specificity in a bill, I ran a regression with the number of pages in the law as the dependent variable, and the amount of staff as one of the independent variables. The staff resources variable was not significant and appeared to have little impact on the number of pages in the law. Given this evidence, it appears that the staff resources variable is a better predictor of using temporary authorization than specificity. The interpretation of the interaction effect is a little less straightforward, so I estimated the elasticity of the conflict and complexity coefficients to illustrate how this variable works. To demonstrate the effect of their interaction, I calculated the probabilities that Y ⳱ 1 for different values of conflict and complexity. Table 7.8 lists the probabilities that Y ⳱ 1 for three different values of conflict and complexity holding all other variables at their mean. The medium value for conflict and complexity is the mean, while high and low are plus and minus one standard deviation, respectively. However, the low value for complexity is instead the lowest value in the distribution of subject headings (one subject heading) because otherwise the value would be negative. These results provide some support for my hypotheses. The interaction of conflict and complexity is clear when one compares the top right cell to the bottom right cell. In the upper right hand corner of Table 7.8, where conflict is low and complexity is high, temporary authorization is very probable. In the other three corners of the table, there is a lower chance of using temporary authorization. We can see that as complexity goes up, the probability of temporary authorization also goes up. We also can Table 7.8 Probabilities That a Law Requires Temporary Authorization for Varying Levels of Conflict and Complexity for Laws Referred to Only One Committee

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see that as conflict goes up the probability of using temporary authorization goes down. The probability of temporary authorization increases by 32 percentage points when we move from low to high complexity when conflict is low. However, the probability of temporary authorization only increases by 25 percentage points when going from low to high complexity when conflict is high. The results for the interaction effect are slightly different than I expected. I predicted that uncertainty would amplify the cost of conflict by making decision-making and coalition maintenance more costly. If this were the case, then the probability of temporary authorization would be lowest for the bottom right hand corner. Instead, it is lowest for low conflict and low uncertainty legislation in the top left corner. In the second analysis, I looked at the effects that conflict and uncertainty have on the length of the authorization. These results are presented in Table 7.7. All the models were estimated using the same variables as those in Table 7.5. These models, however, were estimated using ordinary least squares regression, with the dependent variable being the number of years before the laws authorization expired. The choice to use temporary authorization seems to be driven by similar but not identical dynamics as the length of the authorization. The estimate for committee conflict was in the expected positive direction, but was not significant for the models that contained the interaction effect. The estimate of the complexity variable was in the right direction (negative) but was not significant. The interaction term was also in the right (positive) direction but was not significant. The foreign policy and science variables were both significant and positive as predicted. This is consistent with my argument that when a president is an advocate of the program, that program is likely to receive a short-term authorization. DISCUS S I O N My results are consistent with enacting coalitions using reauthorization as a way to reduce transaction costs. I found that conflict and uncertainty both play a role in the choice to use temporary authorization, but in different ways. Complexity had a positive impact on the use of reauthorization, while conflict made reauthorization less probable. Legislation that is broad in scope is much more likely to require reauthorization; however, as conflict increases, members of Congress are less likely to use temporary authorization. These results are entirely consistent with the history of the use of temporary authorization. In my case studies in Chapter 5, I found that increased uncertainty was the main factor that led committees to switch agencies from permanent to temporary authorization. As the conflict over these agencies increased, Congress found this procedure less attractive.

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The president also appears to play an important role in the use of temporary authorization. As suggested in Chapter 3, when the president is an advocate of a program, temporary authorization may be an important check on the abuse of presidential power. The president’s role in foreign policy is a good example of the type of program for which Congress might require reauthorization. The other variable that was important in predicting the use of temporary authorization was the number of staff on a committee. A committee may be able to overcome some of the costs of reauthorization with more staff resources. However, it is also possible that there may be a simultaneity effect here. Some committees may have a greater number of staff because they have more legislation that requires reauthorization. The model also helps to explain the length of authorization. It appears that there are two slightly different choice mechanisms involved between choosing to use temporary authorization, and then choosing the length of the authorization. The most important factor in determining the length of the authorization was the position of the president. This is entirely consistent with the fact that most major authorization legislation dealing with foreign policy lasts only one year. Both committee and partisan conflict work to make the length of the authorization longer, which is consistent with my hypotheses. However, complexity does not seem to have much impact on the length of the authorization. In general, explaining temporary authorization as a congressional procedure that lowers some transaction costs, but increases others, helps us to understand this choice. The test provided in this chapter provides support for this approach. Although I focus on only one institutional mechanism—reauthorization—the logic of this approach would appear to work for any institutional mechanisms that allow more or less intervention in the future. NO TES 1. The Senate Appropriations Committee compiles a list of authorization laws passed each year in volumes entitled Appropriations, Budget Estimates, Etc., which I used as my source for laws created from 1987 through 1990. The information regarding these laws and the committees that passed them was obtained from a variety of sources including the Library of Congress’s legislative database Thomas. The information from this database was supplemented from Legislative Histories published by the Congressional Information Service (CIS) and Congressional Quarterly Almanac for 1987–1990 data. 2. I will discuss authorization status briefly here, but Chapter 4 contains a more detailed discussion of differences in authorization status. 3. In some cases, laws from my sample authorized money for a one-time purpose. For example, the Interior Committee often passes laws authorizing money to purchase land. Since my model relates to control over time, these laws were elim-

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inated from the sample because implementation is not an issue. I also eliminated laws requiring technical corrections, revenue, and extending the debt limit. The elimination of the laws did not bias the results of the model toward my hypotheses, since the model performs better when they are included. 4. These data were collected by Frank Baumgartner and Bryan D. Jones. These data were made available through the Center for American Politics and Public Policy at the University of Washington. 5. These titles are the official titles as listed in the Thomas database. 6. My coding for foreign policy and science and technology were compared to the policy topics used in their policy agendas project. Their category Space, Science, Technology, and Communications was the same as my technology. Their defense and foreign policy categories were also the same except I did not include veteranrelated bills.

CHAPTER 8

Conclusion

The main goal of this study has been to explain how enacting coalitions handle the tradeoff between maintaining coalitions and guiding implementation decisions. My study has tried to improve our understanding in two important ways. First, I applied transaction cost theory to explain how members of Congress handle this tradeoff and how they modify their decision-making as the incentives provided in the institutional structure change. Second, I provided an example of how members face this tradeoff, and I tested hypotheses derived from my transaction cost model. In this final chapter, I want to review the argument and findings of this study and discuss their implications. A TRAN S A C T I ON C OS T A P P R OA C H T O T H E PO LICYM A K I N G P R OC E S S Transaction cost theories were developed to understand contracting problems in which participants develop and protect contracts in a complex environment. The decision-making process for designing economic contracts is very similar to what members of Congress face when designing procedures. In economics, parties design contracts and procedures to ensure a return on their investment, while in legislatures, members design procedures to ensure that they obtain their desired outcomes from their policy choices. The underpinnings of all transaction cost theories are the behavioral assumptions of opportunism and bounded rationality. As Williamson (1985) states, both of these conditions must exist for contracting problems

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to exist. If parties are unboundedly rational, then they can design institutions that deal with future contingencies perfectly. If parties are not opportunistic, then they can write general agreements that both sides will follow. However, transaction cost theory for economics does not always apply to political agreements and, therefore, the logic of the theory must be adapted to the legislative process. These differences are most obvious with respect to characteristics of transaction cost theory. In a legislative setting, the two most important characteristics are conflict between decision points and uncertainty over nature, which both create costs for members of Congress in enforcing agreements. Congress will use procedures in a way to minimize transaction costs and, therefore, legislative agreements will differ depending on the degree of conflict and uncertainty associated with them. Members of Congress must also operate within institutions made up of formal rules and norms that create an incentive structure making some types of actions more likely than others. The legislative process is a sequential structure in which Congress and the president pass legislation that is then implemented by the bureaucracy. I have assumed that, within this system, congressional committees play the predominant role because they bear most of the costs of forming and enforcing agreements. Moreover, how an enacting coalition reacts to the president will depend on whether the president is an advocate of increased bureaucratic activity. As the rules and norms change, the incentive structure also changes, which can alter the usefulness of some procedures. This theory offers a dynamic approach to understanding how members of Congress choose procedures to accompany legislative agreements. First, it allows us to understand why procedures will differ across different types of legislative agreements. Second, we can understand how changing institutional context affects the incentive structure and, consequently, the governance structures that accompany legislative agreements. EMPIRI C A L F I NDI N GS Previous studies (Bawn 1997; Epstein and O’Halloran 1999) have examined how procedures vary across legislative agreements. To add to this literature, I examined the reauthorization procedure, which is one of the best examples of an interventionist governance structure. In Chapter 4, I reviewed how temporary authorization works and demonstrated that it allows members of Congress to guide the implementation of policy, but also creates costs and risks to control. In this section, I review my main findings regarding the use of temporary authorization across programs and over time. Both my qualitative and quantitative analyses provide evidence that Congress has used temporary authorization as a way to control the im-

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plementation of programs. In Chapter 5, I found that committees changed agencies from temporary to permanent authorization when they became less certain about their control over the policy area. In cases like the FTC and BLM, this occurred because Congress delegated new authority to the agency. In other instances, agencies like the NSF had experienced mission creep, due to the increasing complexity of the agency’s activities. The original governance structure under which Congress delegated authority no longer worked to protect congressional interests. There was also a general concern by members that, as the budgets of these agencies grew, Congress had too little say about how and where it was being spent. Finally, in some cases Congress felt like it could no longer trust the agency to follow congressional directions and, therefore, required formal review of the agency’s activities. The results of my quantitative analysis in Chapter 7 also confirmed that increased complexity of legislation increased the likelihood of review. My analysis also confirmed that conflict between decision points generates costs for reviewing legislation, and makes Congress more wary of using temporary authorization. In Chapter 6, I followed the reauthorization history of several agencies and found that the success of passing this legislation was directly related to the degree of conflict between decision points. One of the most important factors contributing to success was the degree of conflict among members of the relevant authorization committee. Major policy disagreements between members of the authorizing committee often played out on the floor, which made passage and control of reauthorization extremely difficult. Congress was most successful in passing reauthorization legislation when the president was an advocate of an agency’s activities and few differences existed among committee members. I argued that members of Congress predict these difficulties in passing reauthorization legislation before they place a program or agency under this governance structure. My findings indicate that the greater the degree of conflict, especially between committee members, the less likely Congress will be to use temporary authorization. For example, Congress did not place OSHA on temporary authorization because of extreme conflict among members of Congress over worker health and safety issues. In passing the original legislation, both the House and Senate authorization committees lost control of their bills on the floor. This would seem to indicate that reviewing the agency’s mission in the future would have been extremely difficult. In my quantitative models I also found that conflict decreased the probability of using temporary authorization. I found that the greater the degree of conflict among committee members the less likely that a piece of legislation would require reauthorization. Moreover, conflict between the parties was also found to decrease the likelihood of using temporary authorization.

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I also established support for my hypothesis that conflict between Congress and the president would affect the choice of temporary authorization. In my case studies, I found that Congress used temporary authorization when it perceived the president had too much impact on an agency’s decision-making. The most obvious examples occurred for agencies that implement foreign policy and defense policy. In the context of my model, this makes perfect sense. Congress has many bargaining disadvantages with the president that reauthorization can partially remedy. Congress has traditionally delegated more power to the president for foreign policy to allow for flexible implementation. This flexibility has often come at the price of decreased congressional control. Reauthorization allows Congress to specify its preferences in a way that does not completely constrain presidential action. Congress also has major information disadvantages with the president over foreign policy issues, and reauthorization allows Congress to inform itself. My final major finding was that the use of temporary authorization by Congress has changed as the institutional structure of Congress has changed. Congress first began to use temporary authorization regularly in the early 1960s. The increased use of this procedure coincided with Congress’s attempt to exercise more control over administrative decisionmaking. By the late 1970s, two changes in congressional structure made reauthorization a less desirable tool of control. First, congressional budget reform added several floor votes, which made it harder to find floor time for reauthorization legislation. Second, the breakdown of norms of deference to committees on the floors of the House and Senate meant that committee members had to worry more about unfriendly amendments being attached to the legislation. The result of these changes has been that many programs have been left unauthorized and the House Appropriations Committee has had to obtain rules to protect its bills from points of order. One of the results of these changes is that power may have shifted from authorization committees to the Appropriation Committees. It seems clear that committees reacted to the incentives provided by the structure in attempting to control outcomes. Beginning in the 1950s, committees saw temporary authorization as a way to exercise more control over power that had been delegated to the president and the bureaucracy. Of course, some issues, like occupational health and safety regulations, would have been hard for committees to review, but more often than not committees could contain these conflicts. Committees whose members were not ideologically dispersed were more likely to see reauthorization as an attractive control mechanism. However, these incentives changed drastically by the late 1970s with the changes in congressional structure. Congress quit moving agencies from permanent to temporary authorization and it had more difficulty passing the reauthorizations when they came up for renewal. Ironically, the movement to temporary authorization

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has contributed to a breakdown of the routines in the authorization process, and may have actually decreased the influence of authorization committees. FUTURE D I R E C T I ONS O F R E S E A R C H In this study, I have reviewed the transaction cost literature, which seeks to explain how politicians design institutions to control political outcomes. Some of the findings in this study differ from what others have found using the transaction cost approach. For example, Epstein and O’Halloran (1999) found that Congress gives more discretion when there is uncertainty over policy or the committee is an outlier, and less when there is divided government. One difference between my study and theirs is that they assume the floor makes the ultimate decision over governance structures, while I assume the committee is the one that chooses to review and bring the issues to the floor. It is on the floor that the committee can lose control of policy. It may be the committee and the floor have different preferences for governance structures. In fact, Bawn (1997) found some evidence that the rank and file members prefer ex ante procedures while committee members prefer ongoing controls. However, Balla (2000) found that committee membership played less of a role than simply ideological differences between the committee median and the floor. The role of the committee and floor in choosing procedures and how this may differ across procedures and policy areas needs to be investigated in more detail. Another area in which research would be useful is how members of Congress may lower the cost of review by altering the terms of the legislative agreement. The choice of what policies the enacting coalition includes or excludes may influence the ability to pass the agreement. Ferejohn (1986) found that Congress incorporated food stamps and farm programs into the same reauthorization cycle to form a more permanent coalition to pass both types of policies. There are also examples in which Congress has split legislation to facilitate agreements. For example, defense-related nuclear programs were separated from other nuclear programs in the 1970s because floor fights over promoting nuclear power kept holding up the reauthorization legislation. Similarly, Congress split the Law Enforcement Block Grant from the rest of the DOJ’s reauthorization because the block grant became too controversial to pass. We also saw that Congress began to rely on omnibus legislation as a way to pass reauthorization that would otherwise not pass. Do committees or enacting coalitions systematically alter these agreements over time to facilitate control? My model and these examples suggest they might, but further study is needed. My study also found that members of Congress could not perfectly predict the relative costs and benefits of using temporary authorization.

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For example, committee members were the ones who insisted on temporary authorization for the FTC and DOJ in the 1970s. However, these very same committees were fighting to control the policy on the floor a few years later. Members of Congress could not predict that the FTC’s use of its new powers would lead to such controversy. Similarly, the Judiciary Committee could not predict that the bussing issue would dominate the DOJ reauthorization bill. When issues are complex and conflicting, it is difficult to predict which issues may arise. Another reason it is hard to anticipate the costs and benefits of using a procedure is that the procedure can change over time. We see some evidence that Congress’s increasing use of temporary authorization has changed the authorization and appropriations processes. When Congress first began to use temporary authorization widely in the 1970s, there was an expectation that the authorization had to be passed. When Congress could not come to an agreement on reauthorization bills for the FTC and the DOJ in the late 1970s and early 1980s, Congress passed short-term authorizations to keep these agencies in business. Members accused each other of threatening the existence of the agencies. This put pressure on everyone to find a compromise. This sense of urgency no longer exists. Congress now routinely uses procedures like waving points of orders in appropriations bills that were only used in extreme circumstances in previous years. Political actors continually try to alter institutional arrangements to change how future policy decisions are made. Consequently, we cannot understand how policy decisions change without understanding the ways in which institutions change. This means that we also need to be careful about making comparisons of the use of procedures over time. The existence of the procedure may tell us nothing about how it is used, and whether the use of that procedure changes over time. NO RMAT I V E I M P L I C AT I O NS I began this study discussing different views of the desirability of congressional control of the bureaucracy. One school argues that bureaucracy should be free to make decisions based upon technical merit. Conversely, the democratic view argues that members of Congress should have a large say over how these decisions are carried out. To what extent does administrative decision-making live up to either one of these ideals? In this study, I examine how Congress sets up procedures that allow intervention. Therefore, my results have direct implications for the bureaucracy versus democracy debate. My results suggest that neither side would find much comfort in the way that Congress designs procedures. The logic of the bureaucratic autonomy view suggests that Congress should give experts more freedom to make decisions when those decisions are technical or complex. Accord-

Conclusion

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ing to this view, Congress should make decisions regarding values, but should stay out of decisions that require expertise. Therefore, increased uncertainty would ideally lead to greater bureaucratic independence. On the other hand, the logic of the democratic view would suggest that the greater the democratic conflict, the more Congress should intervene in decisions. However, I found that greater uncertainty leads Congress to create more interventionist governance structures, and greater conflict decreases the likelihood of interventionist governance structures. Indeed, we can also find plenty of specific examples in my study that run counter to both normative ideals. In many instances, the primary motivation for reauthorization was to further the parochial interests of members of Congress. For example, Congress moved the NSF to temporary authorization to facilitate a greater distribution of scientific funding across congressional districts. The bureaucratic school would see this as problematic because scientific grants should be made on technical merit rather than distributive equity. Similarly, the Merchant Marine and Fisheries Committee placed the Maritime Administration on temporary authorization to protect subsidies within the maritime industry. We also know that that the Armed Services Committees use the reauthorization process to protect weapons systems that may be of questionable defense value. Reauthorization appears to work best when committees have little conflict, and this may lead to using this procedure to protect narrow interests. However, I also found that other factors led Congress to use temporary authorization. In some cases, the authorization committees and other members of the enacting coalition wanted to use renewal to guide the future behavior of the bureaucracy. In the cases of the FTC and the BLM, the new authority was controversial and major forces on both sides had stakes in the outcomes. The democratic view would suggest that Congress had an appropriate role in debating and guiding the future decisions of these agencies. Unfortunately, the process broke down and reauthorization was less of an effective tool of control than was first hoped. These examples should not be taken to mean that reauthorization has only been used for protecting narrow interests, however. One area where reauthorization appears to have worked well is in the area of foreign policy. Although Congress may have used reauthorization to protect local interests in defense procurement, it also appears that members have attempted to use this procedure to check presidential power. Congress has also used this procedure to rein in agencies that clearly had exceeded their authority, like the CIA, the State Department, and the DOJ. It could be argued that the president still has a massive advantage, whether Congress reauthorizes or not. However, it would appear that requiring reauthorization can provide Congress with some leverage it would otherwise not have.

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Reviewing Delegation

We should not overemphasize the benefits of temporary authorization though. Proponents of democratic control have often argued that legislative review of programs would lead to less wasteful and more democratic policies. This assumption was the basis for the sunset reform movement. My findings suggest that this assumption is overly simplistic. In many instances, conflict among participants in the process may overload the decision-making process and make review extremely costly and unproductive. Given the benefits and limitations of the procedure, it is not surprising that Congress has found it more productive to apply review selectively rather than requiring it for all agencies. Even if we believe that bureaucratic decisions should be reviewed and directed by representative institutions, we must understand the difficulties representative institutions face in coming to agreement over what direction that should be.

Appendix: List of Federal Agencies Analyzed in Chapter 4

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140

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Note: The table lists agencies in existence in 1992 or created between 1947 and 1997. The list does not include temporary commissions, agencies located in the Executive Office of the President, agencies located in the judicial branch, congressional agencies, or those created through reorganization. It also does not list agencies if they had the same authorization status as their parent department. Cabinet departments are capitalized.

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Index

Aberbach, Joel D., 1, 3, 50, 57 Administrative procedures, 5–6, 19, 37 Administrative Procedures Act, 4 Advanced Technology Program, 90–91 Adverse selection, 20–21 Agencies: autonomy of, 1–6; budget maximization by, 18; expertise of, 19–21; strategic implementation by, 17–19. See also individual agencies Altfeld, Michael F., 12, 17 American Medical Association (AMA), 94–95 Appropriations Committees, 33, 44–46, 50–52, 63, 75–76, 112; conflict with authorization committees, 58, 63, 75–76; unauthorized appropriations, 46–49, 52–53, 58, 102. See also Authorization Archer, William R., 92 Arkes, Hadley, 54 Armed Services Committees, 15, 48, 71, 76, 112, 129 Arms Control and Disarmament Agency, 74

Arnold, Peri E., 53 Arrow, Kenneth, 20 Art, Robert J., 54, 71 Asset specificity, 28–29, 32 Atomic Energy Commission, 54, 70, 76 Authorization: changing use of, 53–58, conflict between Appropriations and authorization committees, 58, 63, 75–76; House rules regarding, 46–49; legislating on appropriations bills, 50; role of the House Committee on Rules, 47–49, 58; Senate rules regarding, 46–49; unauthorized appropriations, 46–49, 52–53, 58, 102. See also Committee; Conflict; Continuing resolutions; Measurement Bach, Stanley, 33, 35, 38 Balla, Steven J., 127 Banks, Jeffrey, 15–16, 19, 21, 38 Barry, Donald J., 14 Bawn, Kathleen, 8, 11, 124, 127 Bendor, Jonathan, 12, 19, 23, 24 n.2, 42 n.1

156 Benenson, Bob, 21 Besanko, David, 35 Blais, Andre, 18 Boehlert, Sherwood, 51 Bounded rationality, 26–27, 31, 35, 42 n.1 Brown, William Holmes, 46 Brownlow Commission, 53 Broyhill, James, 94, 103 n.7 Budget Committee, 92 Budget Reform and Impoundment Control Act of 1974, 57 Bureaucracy. See Agency; Executive Bureaucratic autonomy, 1–6 Bureaucratic drift, 7–8, 35, 37 Bureaucratic expertise, 19–21, 23 Bureaucratic power, 13–15 Bureau of Land Management: grazing fees policy, 98; multi-use mission, 96; Reagan and Congress conflicts, 97; reauthorization in 1996, 99; temporary authorization, 68–69 Burton, Phillip, 79 Bussing, school, 99–100 Calvert, Randall L., 5–6, 19 Carney, Dan, 91, 94 Case selection, 55–56, 61–63 Case study method, 61–63 Central Intelligence Agency (CIA), 74–75, 87–88, 129 Chamber of Commerce, 78, 94 Clinton Administration, 88, 90, 98, 102 Coalitional drift, 7–8, 15, 35, 37 Coase, Ronald H., 26 Coast Guard, 71–72, 88–89 Collie, Melissa P., 113 Collins, James, 100 Commerce, Science, and Transportation Committee, Senate, 67, 75, 76, 89, 96 Commerce Committee, House, 67, 73, 94–96, 112 Committee: autonomy, 23, 40, 57–58, 83–84, 102; conference, 14, 111; conflict within, 110–13; contract enforcement by, 14–15; gate-

Index keeping power, 36, 48, 113–15; information specialists, 15–17; internal vs. external conflict on, 111–12; multiple referral, 113, 117; staff, 106. See also individual committee names Conference committee, 14, 111 Conflict: authorization and Appropriations committees, 75–76; coalition building and maintenance, 32–35, 37–41; committee, 85, 110–13; committees and floor, 13–15, 113; Congress and bureaucracy, between, 17–19; Congress and the president, between, 36, 40–42, 72–74 Congressional dominance theory, 4–6 Consumer policy. See Federal Trade Commission Continuing resolutions, 47, 58 Contracting: enforcement costs of, 29; legislative agreements as, 31–33; measurement costs of, 20, 28–29. See also Transaction cost theory Conyers, John, 100 Cooper, Joesph, 113 Customs Service, United States, 71–72, 91–92 Daniels, Dominick V., 79 Daniels, Steven R., 34 Dawson, Raymond H., 54, 76 Deering, Christopher J., 85, 111–12 Delegation, 1, 19, 38–41, 53–54, 66–69, 77, 113 Dellums, Ronald, 48 Democratic Caucus, 48 Department of Defense, 54, 70–71, 76, 87 Department of Justice, 67, 75, 99–103, 127 Department of Labor, 78–81. See also Occupational Health and Safety Administration Department of State, 53–54, 129; reauthorization of, 88; temporary authorization requirement, 74 Devins, Neal, 50

Index Dion, Douglas, 107 Dion, Stephan, 18 Discretion: Bureau of Land Management, 68–69; committee, 13–17; definition of, 38; Executive, 7–8, 17–21, 53–54, 57; Federal Trade Commission, 66–67; Securities and Exchange Commission, 69, 73. See also Agencies Distributive theory, 13–15 District of Columbia Committee, House, 112 Dlouhy, Jennifer A., 101 Dodd, Lawrence C., 2–3, 51 Durant, Richard F., 68, 97 Economic Cooperation Agency, 54 Education and Labor Committee, House, 78–79, 84, 112 Energy and Commerce Committee, House. See Commerce Committee, House Enforcement costs, 29. See also Contracting; Transaction cost theory Environmental Protection Agency (EPA), 5, 55 Epstein, David, 8, 11, 19, 24, 25, 37–38, 113, 124, 127 Ex ante control, 27, 37–38, 106, 127 Executive Office of the President, 55 Ex post control, 15, 37–38, 127 Federal Trade Commission (FTC): deceptive trade practices, 66–67; reauthorization conflict, 94–96; regulation of advertisers, 96; trademark regulation, 94; temporary authorization requirement, 66–67 Fenno, Richard, 33, 45 Ferejohn, John, 18, 127 Finance Committee, Senate, 73 Finer, Herman, 1 Fiorina, Morris, 13 Fire alarm oversight, 4–5 Fisher, Louis, 45–47, 49–50, 59 n.1, 65, 71, 75

157 Foreign Affairs Committee, House, 52, 72, 84, 112 Foreign aid policy, 47, 50–53, 88 Foreign Relations Committee, Senate, 52–53, 72, 74 Friedrich, Carl, 1 Gate-keeping power, 36, 48, 113–15. See also Committee General Accounting Office, 46–47, 106 Gibbons, Sam M., 92 Gordon, Bernard, 76 Governance structure, 25–32, 37–42. See also Authorization; Contracting Government Manual, United States, 55 Hidden action problem, 20 Hidden information problem, 20 Horn, Murray J., 7, 11 Huber, John D., 8, 25, 107 Hyde, Henry, 50–51, 101 Information asymmetries, 12, 15–16, 19–21, 24 n.2. See also Principal agent models; Signaling games Information theory, 15–17 Insider trading scandal, 93 Institutional structure, 29–30, 35–37 INS v. Chadha, 103 n.9 Interior Committee, House, 68–69, 84, 97–99, 102 International Trade Commission, United States, 60 n.13, 69, 73, 89, 90–91 Interstate and Foreign Commerce Committee, House. See Commerce Committee, House Jajnige, Thomas P., 50 Javits, Jacob, 77, 80 Johannes, John R., 3 Johnson Administration, 73–74, 78–79 Joint Committee on Atomic Energy, 70, 75–76 Judiciary Committee, House, 53, 84, 100–101, 112

158 Judiciary Committee, Senate, 75 Kaiser, Fred, 3 Kiewiet, Roderick, 2, 20 Kindelberger, Charles P., 54 King, Gary, 61–62 Kirst, Michael, 50 Keohane, Robert O., 61–62 Kovacic, William E., 96 Krehbiel, Keith, 15–17, 38, 107, 113–14 Kreps, David M., 38 Labor and Human Resources Committee, Senate. See Labor and Public Welfare Committee, Senate Labor and Public Welfare Committee, Senate, 71, 80, 89 Land policy. See Bureau of Land Management Landsidle, David, 53 Lees, John D., 3 Legislation: complexity, 106, 113–14; contract, 31, 37–41; omnibus, 29, 33, 39, 87, 91–92, 99, 107–9, 127 Legislative procedures, 110; discharge petition, 23, 100, 103 n.7; legislative veto, 53, 68, 71, 73, 96, 103 n.9; restrictive rule, 14, 18, 92; waiving points of order, 46–48. See also Authorization; Governance structure Legislative Reorganization Act of 1946, 36 Lewis, David E., 54 Loomis, John B., 68 Lowi, Theodore J., 57 Magnuson, Warren, 76 Maritime Administration, 111, 129; reauthorization of, 90–91; temporary authorization requirement for, 73–74 Marshall, William, 14, 22, 25, 31–32, 36 Marshall Plan, 53–54 Mashaw, Jerry L., 6 Mayhew, David, 13

Index McCubbins, Mathew, 2, 4–6, 11, 18–21, 33–34, 37, 42 n.2 McCutcheon, Chuck, 99 McEwan, Robert D., 98 McKelvey, Richard D., 13 Measurement: of authorization length 108, 110; of authorization status, 107–9; committee conflict, 108, 110–12; complexity, 108, 114–15; conflict between the committee and floor, 108, 113; conflict between president and Congress, 108, 113; salience, 108, 111 Measurement problems, 20, 28–29. See also Principal agent models; Transaction cost theory Mendeloff, John, 80 Merchant Marine and Fisheries Committee, House, 73, 84, 88, 90, 102, 112, 129 Milgrom, Paul R., 26, 28 Miller, Gary J., 12, 17–18, 24 Mine Safety and Health Administration, Federal, 81 Mine Safety and Health Review Commission, Federal, 81 Mitchell, George, 92 Mitnick, Barry M., 4, 20 Moe, Terry, 1, 4–6, 20–21, 24, 33–36, 77, 79, 103 n.10 Moral hazard, 20 Moran, Mark, 5, 7, 52, 96 National Aeronautics and Space Administration (NASA), 50, 63, 65 National Association of Manufacturers, 78 National Bureau of Standards. See National Institute of Standards and Technology National Institute of Standards and Technology, 55, 75, 90–91, 102 National Reconnaissance Office, 21 National Science Foundation, 51, 111, 135, 129; reauthorization, 90–91, 101–2; temporary authorization requirement, 71

Index National Security Committee, House. See Armed Services Committees Needham, James J., 69 Neustadt, Richard, 14 Niskanen, William C., 17–18, 24 n.2 Nixon Administration, 53, 72–73, 79–80 Noble, Charles, 78–79 Nominate scores, 111–12 Noll, Roger, 5–6, 18–19, 21, 37, 42 n.2 Norms, 26, 37, 29–30 North, Douglas, 26, 28–31, 83, 113 Occupational Safety and Health Administration (OSHA), 77–81 Occupational Safety and Health Review Commission, 77–81 Office of Management and Budget, 73–74 Ogul, Morris S., 3 O’Halloran, Sharyn, 8, 11, 19, 24, 25, 37–38, 113, 124, 127 Omnibus legislation, 29, 33, 39, 87, 91–92, 99, 107–9, 127. See also Legislation Opportunism, 26–27 Oversight, 3–4, 65–66; abdication view of, 3; congressional dominance view of, 4–6; ex post, 15, 37–38, 127; fire alarm, 4–5; police patrol, 4; temporary authorization for, 49–51, 65–66. See also Agencies; Authorization Peace Corp, 74 Pertschuk, Michael, 94 Poole, Keith, 34, 111 Political uncertainty, 33–35 Pomper, Miles, 88 Pratt, John W., 20 President, 5, 14, 35–36, 38, 53–55; advocacy of programs, 18–19, 40–41, 113; veto, 14, 18–19, 40–42, 88, 90, 92, 97, 99, 102. See also individual presidents Principal agent models, 4, 19–21

159 Procedures: administrative, 5–6, 19, 37; authorization, 46–49. See also Contracting; Governance structure Public Land Law Review Commission, 68 Ragin, Charles, 61 Reagan Administration, 5, 88, 90, 92, 97, 102 Reauthorization. See Authorization Reputation, 23, 28–30, 32, 38, 74–75 Resources, Committee on, House. See Interior Committee, House Riker, William H., 13, 26 Risk Management Agency, 57 Roberts, John, 26, 28 Robinson, Glen, 1, 6 Rockman, Bert E., 1, 3 Romer, Thomas, 22 Roosevelt, Franklin D., 53 Rosenthal, Howard, 22, 34, 111 Rostenkowski, Dan, 92 Rubin, Irene, 75, 99 Rules: authorization, 46–49, legislating on appropriations bills, 50; unauthorized appropriations, 46–49, 52–53, 58, 102 Rules Committee, House, 14, 47–49, 52, 58 Schattschneider, E. E., 13 Schick, Allen, 3, 49, 54, 58, 77 Schmitt, Harrison H., 81 Schott, Richard L., 2–3, 51 Schwartz, Thomas, 4 Science Committee, House, 84, 90–91, 112 Science policy. See National Institute of Standards and Technology; National Science Foundation Securities and Exchange Commission (SEC): insider trading scandal policy, 93; reauthorization of, 89, 93–94; temporary authorization requirement for, 69 Setter model, 22 Shepsle, Kenneth A., 7, 11, 13–14, 24, 31

160 Shipan, Charles R., 8, 18, 25 Signaling games, 15–17 Sikes, Robert L. F., 80 Simon, Herbert A., 26–27 Sinclair, Barbara, 107 Skubitz, Joe, 69 Smith, Steven S., 33, 35, 38, 47, 58, 83, 85, 103 n.2, 111–12 Solomon, Gerald G. H., 58 Special Trade Representative, Office of, 91 Spulber, Daniel F., 35 Stennis, John C., 76 Stephens, Herbert W., 71, 76 Steiger, William, 80 Stewart, Charles H., 59 n.2 Strategic implementation, 17–19, 22 Streeter, Sandy, 46 Substance Abuse and Mental Health Services Agency, 57 Sundquist, James L., 53, 75, 77 Sunset reforms, 57, 97, 106, 130 Synar, Mike, 98 Tariff Commission. See International Trade Commission Taylor, Andrew, 93 Taylor, Serge, 19, 23 Technology policy. See National Institute of Standards and Technology Temporary authorization. See Authorization Tiefer, Charles, 46–47 Towell, Pat, 88 Tradeoff view of political control, 6–9. See also Transaction cost theory Trade Policy. See International Trade Commission, United States Transaction cost theory: asset specificity, 28, 32; behavioral assumptions of, 26–27, 31–32;

Index characteristics of the transaction of, 27–29, 33–35; institutional structure and, 29–30, 35–37; legislative setting and, 8–9, 31–42; measurement problems and, 20, 28–29; norms, 26, 37, 29–30; role of conflict and, 32–35 Truman, Harry S., 53 Udall, Morris, 97 Uncertainty: behavioral, 33–35, 39–40; definitions of, 33–35; information, 15–17, 19–21, 39–40; measurement of, 113–15; transaction cost of, 27–29, 32–37 United States Information Agency, 72, 74, 82 n.2 Van Gaalen, Roland, 19, 23 Vento, Bruce F., 98 Verba, Sidney, 61–62 Veto, presidential, 14, 18–19, 40–42, 88, 90, 92, 97, 99, 102. See also Legislative procedures Walker, Robert, 90 Waterman, Richard W., 6, 20 Watt, James G., 97 Ways and Means Committee, House, 84, 91–93, 112 Weiker, Lowell, 99 Weingast, Barry R., 5–6, 11, 13–14, 18–19, 21, 25, 31–32, 37, 42 n.2, 52, 96 White, Joseph, 47, 50–51, 53 White, Leonard D., 1 Wildavsky, Aaron, 26, 51 Williamson, Oliver E., 25–32, 35, 123 Wolfenberg, Donald R., 58 Wood, Dan B., 6, 20 Zeckhauser, Richard J., 20

About the Author JAMES H. COX is Assistant Professor, Department of Government, California State University, Sacramento.