Federalism Hedging, Entrenchment, and the Climate Challenge
By William W. Buzbee
The virtues and effects of federalism continue to generate political, judicial and scholarly ferment. While some federalism partisans champion exclusivity and separation, others praise the more common political choice to retain federal and state regulatory overlap and interaction. Much of this work, however, focuses on government learning or rule clarity, giving little or no attention to how different federalism choices can heighten or hedge risks of regulatory failure and policy reversal. These debates play out with unusual fervor and with high stakes in battles over climate change regulation. Despite broad agreement that any effective climate policy intervention must include national action, disagreement reigns regarding the retention of state authority. Prominent policymakers, industry voices, and scholars have championed a single regulator and clean authority delineation as the answer to the challenges of climate change. They characterize state climate policies as a weak or even harmful alternative, especially if overlapping or intertwined with a federal role. A global challenge like climate change does intuitively seem to be a quintessential setting for a single, comprehensive regulator, especially if addressed through marketutilizing regulation. This intuition, however, only makes sense under an idealized view of politics and regulatory efficacy. This Article introduces the concept of federalism hedging—namely retention of concurrent federal and state authority due to its benefits and especially protective effects, even in an area ideally regulated by a single national regulator— then disaggregates sometimes blurred but related strains in federalism analysis. It illuminates federalism hedging dynamics through a theoretical and historical case study of climate regulation and federalism choice. This Article argues that where effective regulation is dependent on innovations and applies in areas characterized by rapid change in regulatory design, markets, and technology, such regulatory design choices—especially regarding federalism allocations of authority—should not be based on optimistic assumptions of steady progress and easy implementation. Effective regulatory structures should hedge risks, with special attention to linked political and economic dynamics. Regulation that retains room for both federal and state involvement and overlap can provide room for regulatory learning and adjustment, catalyze commitment and corrective efforts, while still fostering beneficial regulatory and market entrenchment and resulting stability through a web of similarly directed regulation.
Economic Analysis of Labor Regulation
By Hiba Hafiz
In an era when administrative agency actions succeed or fail based on the thoroughness and rigor of their cost-benefit analyses and expertise, the 1940 statutory ban on hiring economists at the National Labor Relations Board (NLRB) is a shocking anachronism. The ban, accompanied by the Board’s failure to solicit external expertise, severely limits the success of the Board’s actions on judicial review, its institutional competency, and its ability to assess the economic effects of its labor regulation in achieving a central goal of the National Labor Relations Act: equal bargaining power between workers and their employers that secures competitive wages and increases worker purchasing power.
This Article proposes the reestablishment of a Division of Economic Research at the NLRB to integrate the study, analysis, and propagation of labor-related social science into the Board’s enforcement and policymaking. In doing so, it draws on the history of the Board’s short-lived Division of Economic Research (1935 to 1940) and on the broader development and incorporation of economic and social scientific expertise into the administrative state to consolidate best practices for a new Division. Rejecting the development of expertise through interagency working groups and Office of Information and Regulatory Affairs review as insufficient, the Article provides the first roadmap of its kind on how a new internal “think tank” could integrate micro- and macroeconomic analysis into the Board’s labor regulation. The work of a new Division would not only develop and hone the Board’s ability to achieve the Act’s goals through rulemaking and adjudication, but it would also enhance the standing of the Board before the courts and the Board’s ability to contribute to national debates on how to fight inequality and reverse the dramatic decline of labor’s share of national income relative to capital.
Atlas Nods: The Libertarian Case for a Basic Income
By Miranda Perry Fleischer & Daniel Hemel
Proposals for a universal basic income are generating interest across the globe, with pilot experiments underway or in the works in California, Canada, Finland, Italy, Kenya, and Uganda. Surprisingly, many of the most outspoken supporters of a universal basic income have been self-described libertarians—even though libertarians are generally considered to be antagonistic toward redistribution and a universal basic income is, at its core, a program of income redistribution. What explains such strong libertarian support for a policy that seems so contrary to libertarian ideals?
This Article seeks to answer that question. We first show that a basic safety net is not only consistent with, but likely required by, several (though not all) strands of libertarian thought. We then explain why libertarians committed to limited redistribution and limited government might support a system of unconditional cash transfers paid periodically. Delivering benefits in cash, rather than in-kind, furthers autonomy by recognizing that all citizens—even poor ones—are the best judges of their needs. Decoupling such transfers from a work requirement acknowledges that the state lacks the ability to distinguish between work-capable and work-incapable individuals. Providing payments periodically, rather than through a once-in-a-lifetime lump-sum grant, ensures that all individuals can receive a minimum level of support over lifespans of variable lengths, while also allowing individuals to adjust payment flows through financial market transactions.
Although our main objective is to assess the fit between libertarian theory and a universal basic income, we also address various design choices inherent in any basic income scheme: who should receive it?; how large should it be?; which programs might it replace?; and should it phase out as market income rises? Lastly, we consider the relationship between a basic income and the political economy of redistribution. We find that the case for a basic income as a libertarian “second-best” is surprisingly shaky: libertarians who oppose all redistribution but grudgingly accept a basic income as the least-worst form of redistribution should reconsider both aspects of their position. We conclude by drawing out lessons from our analysis for non-libertarians, regardless of whether they are supportive or skeptical of basic income arguments.
Not Just a Fantasy: The Real Benefits of Daily Fantasy Sports Legislation for Wisconsin
By Brian C. Miller
In mid-November of 2015, protestors chanting “GAME OF SKILL! GAME OF SKILL!” clamored outside New York Attorney General Eric Schneiderman’s office. The crowd protested Schneiderman’s recent declaration that Daily Fantasy Sports (DFS) contests are illegal “games of chance,” under New York’s gaming laws. Schneiderman denounced DFS websites as “totally unregulated gambling venues,” and banned their operations in New York. Echoing the protestors’ chants, proponents of DFS argue that DFS contests are legal “games of skill.” A fantasy sports contest is a type of online game in which participants choose from professional athletes in an online selection process, known as a draft, to assemble a virtual team. The participants’ virtual teams compete and accumulate points based on the statistical performances of professional athletes in real sporting events. “Players track how their fantasy team is doing using various web sites or mobile apps. Some players join leagues with friends and compete against only people they know. Others join public leagues hosted by web sites and compete against strangers.”