Reclaiming Regulatory Intermediation for the Public

Authors

Daniel E. Walters, Texas A&M University School of LawFollow

Document Type

Article

Publication Date

11-2023

Journal Title

Law and Contemporary Problems

Abstract

Managerial governance is often operationalized through outsourcing the regulatory function from public institutions—for example, administrative agencies—to private organizations. In virtually any sector, it is possible to identify private “regulatory intermediaries” that step between public agencies and regulated parties to perform tasks traditionally played by government actors—for example, the development of regulatory standards, auditing, compliance assurance, enforcement, and more. Although this reliance on private regulatory intermediaries may in some cases be highly advantageous to government institutions since it may sometimes allow government agencies to do more regulatory work than their own resources and capacity might allow—it comes at significant costs of runaway managerialism and a gradual withering away of public values in regulatory governance. As independent organizations operating in the twilight between public regulatory agencies and regulatory targets and beneficiaries, private regulatory intermediaries have both the incentives and the discretion to facilitate an undiluted managerial ethos in the regulation of entire sectors of industry.

This article argues that it is time for the public to reclaim regulatory intermediation from managerialism and redirect it towards public values—that is, those shared by the broader community rather than by some organization or industry sector within the community. However, even if this is a worthy goal, there are deeply rooted institutional challenges to realizing it, including a lack of consensus about what is in the public interest. If managerialism is to be curbed in private regulatory intermediation, it will have to be through institutional and procedural reforms that open contestatory spaces within regulatory intermediation where managerialism’s hegemony can be checked by competing value structures advanced by the public.

Building on case studies drawn from regulatory intermediation in the energy sector, I argue here for two reforms that could redirect regulatory intermediation away from managerial imperatives and toward the public interest. First, I suggest that the government pass a Private Administrative Procedure Act (PAPA) requiring private regulatory intermediaries to provide certain processes that afford the public an opportunity to engage with and contest regulatory intermediaries’ actions, much as they would have a chance to do if regulation was conducted by government instrumentalities. Second, following on the lead of the Federal Energy Regulatory Commission’s new Office of Public Participation, I suggest that the government create a new trans-substantive agency—an Office of the Public Interest—that would be charged with imposing and enforcing process reforms and promulgating minimum standards of public care for organizations engaged in regulatory activities, whether private or public.

First Page

157

Last Page

196

Num Pages

40

Volume Number

86

Issue Number

3

Publisher

Duke University School of Law

Recommended Citation

Daniel E. Walters, Reclaiming Regulatory Intermediation for the Public, 86 Law & Contemp. Probs. 157 (2023).
Available at: https://scholarship.law.tamu.edu/facscholar/1980

File Type

PDF