The Collective Action Constitution(s)

JB

For the Balkinization Symposium on Neil S. Siegel, The Collective-Action Constitution (Oxford University Press, 2024)

The basic thesis of The Collective-Action Constitution is that one should interpret the U.S. Constitution so that the national government is empowered to solve collective action problems among the various states. Siegel argues that this collective action principle also explains much of the design of the 1787 Constitution. The argument can be originalist but it need not be. It is a structuralist argument focused on contemporary solutions to contemporary problems. 

Many people have made arguments of this kind before in particular contexts, but no one, to my knowledge, has offered as comprehensive an account of the entire Constitution and its various provisions through the lens of collective action. It is a remarkable achievement that is unlikely to be surpassed.

Siegel tries to show that much of existing doctrine in many different areas of constitutional law is consistent with collective action reasoning. Nevertheless, he is critical of some aspects of current doctrine, and he thinks that some of the Court's doctrines, for example, the economic/non-economic distinction in United States v. Lopez and United States v. Morrison, are best defended as proxies for collective action reasoning, although they are very imperfect proxies.

In this blog post, I'll explain why Siegel's theory, although phrased in terms of structural reasoning, actually leads inevitably to a legal process theory. In order to work in practice, a collective action theory requires a series of complicated and contestable factual and normative judgments about the existence and extent of collective action problems, as well as the appropriate solutions. 

Since different people will make different judgments about these matters, the question becomes who decides-- the classic legal process question. Thus, a collective action theory quickly turns into the question of which actors in the political system are most competent or most democratically authorized to resolve these complicated and potentially unknowable factual and normative questions.

The complexity of these questions, I believe, justifies Siegel's general view that courts should defer to Congressional judgments. This includes deference to Congress's construction of the administrative state, which in practice makes a large number of federal policy decisions.

Nevertheless, Siegel's account of the Collective Action Constitution is not the only possible one. In fact, there are many possible Collective Action Constitutions based on his central principle. I will try to explain why that is so.

I. The Problems of Collective Action Problems

Siegel identifies three kinds of collective action problems that might exist in a federal republic like the United States.

Coordination problems are those in which "some or all states would need to coordinate their behavior to solve a problem but there are multiple possible ways of doing so and there may be disagreements about how to do so." Coordination problems are a special case of a larger category of Pareto-optimal collective action problems. These are collective action problems in which "all states would be better off by their own estimations if collective action succeeded."

However, Siegel explains, most collective action problems in American politics do not fit into this category. Most situations involve "cost-benefit" collective action problems, "in which some states would regard themselves as better off if collective action succeeded but other states would regard themselves as worse off," but the winners gain more than the losers lose.

Deciding whether there is a collective action problem among the states that justifies a national solution (whether Pareto-optimal or not) requires knowing the costs and benefits of different policies for different states. But States may disagree about the payoffs from cooperation or non-cooperation. Depending on what the payoffs turn out to be, what initially looked like a Pareto-optimal result from mandated coordination may actually not be Pareto-optimal, because some states benefit at the expense of others.

Moreover, depending on what the payoffs turn out to be, what appeared at first to be a collective action problem may not be a collective action problem at all, because the losers would lose more from mandated cooperation than the winners win. In that case, if cooperation is mandated, what we really have is a cartel imposed at the national level for the benefit of one group of states that imposes costs on a different group of states. The winning states will argue that without mandated coordination there is a race to the bottom, while the losing states will argue that interstate competition is a good thing and that there is actually a race to the top.

All of this means that a collective action theory explains and justifies the allocation of federal power to the extent that we can know what the payoffs are for a given type of policy question or a given subject of regulation. But if the payoffs are incorrect or cannot be known, the theory does not explain or justify constitutional arrangements. This problem, in turn, is connected to familiar problems in cost-benefit analysis.

First, the parties in the political system are not reliable reporters of costs and benefits. States have incentives to exaggerate the costs to them (and to other states) of national policies they oppose and the benefits of national policies they support.

Second, States may claim that the costs imposed by national policies are social or cultural and not easily translated into or compared with costs and benefits in other states. A state may argue, for example, that a proposed national policy would destroy a way of life or undermine important religious, moral, and cultural values within the state. Trying to compare these costs or measure them in dollars is both unjust and futile.

Historically, this kind of argument has often been inegalitarian, because it is designed to preserve existing local social status hierarchies from federal interference on the grounds that the federal government should not interfere with "inherently local" subjects like the family, employment relationships (as in Carter Coal), and local customs and mores. But the argument need not be inegalitarian if the mores protected are more egalitarian than those enforced by the national government.

Third, cost-benefit collective action problems are defined as those in which the winners from the national policy could, in theory, compensate the losers. This test leads to the well-known problem of whether the baseline of measurement for compensation should be the affected states' willingness to pay to or their willingness to accept. Some states in a federal republic might be at a particular disadvantage if the test is willingness to pay.

Fourth, states are collections of different people with different interests and concerns. A national policy that makes some people in a state worse off  might make other people in the state better off, and vice-versa. The government of the state may not adequately represent the balance of interests in the state and therefore have a biased estimate of the costs (or benefits) to the state as a whole. Political elites within the state may choose policies that disregard or even oppress less powerful interests, so that the costs and benefits to the latter do not count in the larger calculus of what is best for the nation as a whole. This will skew the analysis of what kind of collective action problem we have, or whether there even is a collective action problem in the first place. (The earlier discussion of local elites trying to preserve status hierarchies is one example. Elites also might be beholden to capital rather than labor, and so on).

Fifth, even if a national problem in general requires a national solution, the specific solution national elites choose may be far more intrusive than necessary to solve the problem. The solution may include situations where there is a genuine collective action problem as well situations where there is not. It may impose a solution that is so extensive and intrusive that the benefits to some states no longer outweigh the costs to other states. Put another way, in identifying and resolving a collective action problem, the national government may overreach and impose unnecessary and unjustified costs on some parts of the nation, while giving an unjustified subsidy to other parts. For example, the government may impose environmental rules greater than necessary to solve the collective action problem posed by pollution. It may offer detailed requirements for workplaces that do not actually solve collective action problems but instead simply impose the cultural values of national elites, and so on.

Sixth, and relatedly, collective action reasoning is subject to a levels of generality problem. Even if some regulations of commerce  solve collective action problems, it does not follow that a general power to regulate commerce can be justified on collective action grounds. Even if a general power to regulate in some area makes sense in the abstract, it may not make sense in a wide range of individual cases. The more general the power, the more likely it is that only some of its applications solve collective action problems and that others do not. Granting a general or abstract power to regulate a particular subject matter throws together situations where there are genuine collective action problems and sitations where there are not. For example, a general federal police power would allow the national govenrment to solve virtually all collective action problems among the states, but it would empower many other kinds of decisions as well. So the plausibility of the argument for federal power can vary depending on the level of generality at which we describe the federal power. This problem of levels of generality emerges in debates over whether national power should be read broadly or narrowly, that is, in perennial debates over loose versus strict construction.

II. Deciding Who Decides

Collective action arguments, in other words, often rest on controversial judgments and disputable claims about facts, values, causes, and effects. To make a Collective Action Constitution work, therefore, we have to make the kind of institutional judgments about decisionmakers that are familiar to legal process theories. We must make a decision about which actors are best equipped, and under which circumstances, to consider the relevant costs and benefits, decide whether a national solution is warranted, and the proper scope of the national solution. "Best equipped" might mean with the greatest decisional competence, with the greatest legitimacy, or some combination of both.

Siegel understands these problems. In general, his solution is to defer to Congress's judgments of three kinds: (1) about whether there is a national problem, (2) about the relative costs and benefits to the states and persons within those states, and (3) about the extent and scope of the solution necessary to solve the collective action problem. Finally, he supports a broad construction of the powers granted to Congress, which means that he assumes that a broad construction of constitutional provisions articulates the scope of federal power at right level of generality.

Siegel's basic approach of deferring to Congress and construing federal power broadly rather than narrowly is in most cases a sensible solution. It is the approach that I would choose most of the time, for reasons I'll describe later on. But it is not the only possible approach to collective action problems in a federal republic like the United States.

Start from the book's basic claim-- that the national government is and should be empowered to identify and solve collective action problems and that the Constitution should be interpreted accordingly-- and you will discover that there are multiple ways to realize that principle in practice. You can produce different versions of the Collective Action Constitution by assigning to different parties the task of determining (1) the actual costs and benefits of collective action among the various states, (2) the existence or non-existence of a genuine collective action problem, (3) the most appropriate national solutions, and (4) the appropriate level of generality at which to describe the scope of national powers.

Hence there is not a single Collective Action Constitution, but multiple possible Collective Action Constitutions, and one must have ways of deciding among them. The principle of collective action by itself cannot decide among them, because, by hypothesis, all of them are exemplars of the principle. Perhaps there are some versions that every reasonable person would agree are very poor at realizing the principle, but this leaves a large set of possible alternatives still in play. Or, to put it another way, the principle of collective action, like all principles, does not determine the scope of its own extension, but can be realized in multiple ways.

To give only two examples: First, a constitutional designer might believe  courts should create robust judicially enforceable federalism doctrines to prevent Congress from overreaching, given the pathologies of national policy making, the feared domination of national elites who seek to impose their values, and the tendencies of bureaucracies to expand their control over more and more subjects.

Second, a constitutional designer might think that an administrative state relatively insulated from electoral competition is especially likely to overreach, engage in empire building, and impose unnecessary and non-cost-benefit justified costs on some of the states, especially those out of sync with the values of dominant national elites. Then one might want courts to create doctrines that require Congress, and not the President acting through the administrative state, to decide whether there is a need for national regulation and the precise scope of that regulation.

Both of these examples show that something like comparatively limited federal power, strong judicial review, and a weak administrative state supervised by courts could also be justified under the collective action principle, depending on one's assumptions about how the world works. But those are not Siegel's choices.

III. Democratic Legitimacy and Democracy Deficits

Siegel's most important argument for deference and for giving Congress its choice of means-- including in the construction of an administrative state-- is democratic legitimacy. Congress represents everyone in the country and specifically represents the States in the Senate. Therefore, if there is a dispute about the nature of a problem, or about the means of solving it, or about both, these questions should be decided by majority rule of the institution that represents the nation as a whole. (In fact, in our world, these questions are actually decided by a supermajority of the Senate plus a majority of the House and subject to a veto by the President that requires a supermajority to overcome.) Courts should also defer to Congress's judgments about the scope of national power unless its judgments are unreasonable (which, Siegel points out, is not the same thing as the rational basis test.)

One problem, as Siegel notes, is that Congress is an imperfect institution with collective action problems of its own. In our current era of deeply polarized politics, Congress finds it difficult to promote the public good because it is often gridlocked, which has led the President and the courts to take over a great deal of national policy making.

This kind of gridlock is not a permanent condition-- we had something very similar during the First Gilded Age, as I pointed out in my book The Cycles of Constitutional Time. So perhaps Siegel's argument for deference to Congress makes the most sense viewed over the long run.

Even so, the argument from democratic legitimacy cuts both ways. Alongside the expansion of national power that came with the New Deal Settlement and its principle of deference to democratic majorities in ordinary social and economic legislation was the related principle of democracy-protection. Courts should employ judicial review to prevent overreaching by majorities who pass laws that undermine democratic processes or that impose special burdens on minority groups unable to protect themselves adequately in the political process.

The question, then, is whether a judicial duty of democracy-protection also applies to states and state interests. The theory of the Collective Action Constitution is consequentialist and does not treat the states has having rights. But one way of counteracting democracy deficits or threats to democracy is through creating judicially enforceable rights, privileges and immunities. So, perhaps ironically, one possible Collective Action Constitution would call for strong judicial review to protect states from overreaching by the national government and defer to Congress only in cases where, in the court's view, there was a genuine collective action problem. This would lead to something like the dual federalism approach that the New Deal Settlement jettisoned. And it might be justified in part in terms of the intangible or incommensurable traditional local values I described above.

But here's the problem with this "democracy protection for states" argument. We now have over two centuries of experience with judicial protection of "states' rights" or the "dignity of the states." What we have learned from this experience is that the kinds of doctrines that courts have created to protect state interests rarely have much to do with the logic of collective action. The distinctions that courts have drawn over the years-- for example, between manufacturing and commerce, or between direct and indirect effects on commerce--are usually orthogonal to the economic analysis of collective action described in Siegel's book. Even the distinction drawn in Lopez and Morrison between economic and non-economic activities does not really correspond to this logic, since there are plenty of non-economic activities that have significant spillover effects and create collective action problems. (The same is true of the act/omission distinction that appears in NFIB v. Sebelius.) 

Courts may well have some role in policing state-federal boundaries in a Collective Action Constitution: judicial review in preemption and dormant commerce clause are two examples. Nevertheless, the kinds of doctrinal formalisms that courts regularly create to protect state interests from federal overreaching routinely miss the mark. In most cases they do not further the goals of the Collective Action Constitution but undermine them or at best are orthogonal to them. If history shows that courts will not create doctrines that adequately police Congress's judgments, this supports Siegel's general view that deference to Congress is the best policy.