(PDF) Powers, But How Much Power? Game Theory and the Nondelegation Principle

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VIRGINIA LAW REVIEW

VOLUME 104 NOVEMBER 2018 NUMBER 7

ARTICLES

POWERS, BUT HOW MUCH POWER? GAME

THEORY AND THE NONDELEGATION PRINCIPLE

Sean P. Sullivan*

Of all constitutional puzzles, the nondelegation principle is one of the

most perplexing. How can a constitutional limitation on Congress’s

ability to delegate legislative power be reconciled with the huge body

of regulatory law that now governs so much of society? Why has the

Court remained faithful to its intelligible principle test, validating

expansive delegations of lawmaking authority, despite decades of

biting criticism from so many camps? This Article suggests that

answers to these questions may be hidden in a surprisingly

underexplored aspect of the principle. While many papers have

considered the constitutional implications of what it means for

Congress to delegate legislative power, few have pushed hard on the

second part of the concept: what it means for an agency to have

legislative power.

Using game theory concepts to give meaning to the exercise of

legislative power by an agency, this Article argues that nondelegation

analysis is actually more complicated than it appears. As a point of

basic construction, a delegation only conveys legislative power if it

(1) delegates lawmaking authority that is sufficiently legislative in

nature, and (2) gives an agency sufficient power over the exercise of

that authority. But, again using game theory, this Article shows that

an agency’s power to legislate is less certain than it first appears,

*University of Iowa College of Law. Contact the author at sean-sullivan@uiowa.edu.

This Articl e has benefitted from the invaluable research assistance of Reid Shepard, and the

thoughtful comments of Arthur Bonfield, Robert Dudley, Michael Gilbert, John Harrison,

Richard Hynes, Todd Pettys, John Reitz, and Jed Stiglitz.

1230 Virginia Law Review [Vol. 104:1229

making satisfaction of this second element a fact question in every

case.

This more complicated understanding of the nondelegation principle

offers three contributions of practical significance. First, it reconciles

faithful adherence to existing theories of nondelegation with the

possibility of expansive delegations of lawmaking authority. Second, it

suggests a sliding-scale interpretation of the Court’s intelligible

principle test that helps explain how nondelegation case law may

actually respect the objectives of existing theories of nondelegation.

Third, it identifies novel factors that should (and perhaps already do)

influence judicial analysis of nondelegation challenges.

I. INTRODUCTION ................................................................................. 1231

II. THE CHALLENGE OF NONDELEGATION ............................................ 1236

A. The Intelligible Principle Requirement ................................... 1237

B. Theories of Legislative Nondelegation ................................... 1242

1. Textual Arguments ............................................................. 1243

2. Separation-of-Powers Principles ....................................... 1245

3. Common Law Principles of Agency ................................... 1248

4. Functional Governance Concerns ..................................... 1250

III. GAME THEORY & THE POWER TO LEGISLATE ................................ 1252

A. The Definition of Legislative Power ....................................... 1254

B. One-Shot Delegation Conveys Legislative Power .................. 1257

C. Oversight and Procedure Dampen Legislative Power ........... 1259

D. Relationships Further Dampen Legislative Power ................ 1262

E. Summary: Uncertainty of Legislative Power .......................... 1265

IV. COMPLICATING THE NONDELEGATION PRINCIPLE.......................... 1266

A. The Two-Prong Nondelegation Principle ............................... 1267

1. Textual Theories ................................................................ 1267

2. Separation-of-Powers Theories ......................................... 1269

3. Common Law Agency Theories ......................................... 1270

4. Functional Governance Theories ...................................... 1272

B. The Sliding-Scale Intelligible Principle Test .......................... 1273

1. The Sliding-Scale Test over the Centuries ......................... 1275

2. Reconciling Schechter and Yakus ..................................... 1278

V. CONCLUSION .................................................................................. 1281

2018] Game Theory and the Nondelegation Principle 1231

I. INTRODUCTION

In 1935, the Dust Bowl was in full swing. Droughts ravaged the Great

Plains. Massive dust storms blackened the sky from Texas to Canada.

This was five years into the Great Depression and about 20 percent of

the U.S. work force was unemployed. Overseas, Europe was spiraling

into violence, with Hitler rearming Germany while Mussolini invaded

Ethiopia. And at home, the Supreme Court issued successive opinions

striking down components of FDR’s desperately anticipated New Deal

legislation as unconstitutional delegations of legislative power.

Panama Refining Co. v. Ryan

1

and A.L.A. Schechter Poultry Corp. v.

United States

2

concerned portions of the National Industrial Recovery

Act (“NIRA”) authorizing the President to regulate the interstate

transportation of oil and dictate “codes of fair competition” for various

industries. The Court held these authorizations void as unconstitutional

because the lawmaking authority they conveyed was not sufficiently

bound by a congressional statement. In Panama Refining, the Court

complained that “Congress has declared no policy, has established no

standard, has laid down no rule” such that “[t]here is no requirement, no

definition of circumstances and conditions in which [the President must

act].”

3

In Schechter, it drew the argument further, deriding a key

provision of the statute as “without precedent” in granting broad

regulatory authority with “no standards [to guide its exercise], aside

from the statement of the general aims of rehabilitation, correction and

expansion,” leaving exercises of the delegated lawmaking discretion

“virtually unfettered” by the terms of the Act.

4

In the language of

modern nondelegation cases, these provisions lacked an intelligible

principle to guide and cabin the exercise of the delegated lawmaking

authority. They were thus void as unconstitutional delegations of the

legislative power.

But Panama Refining and Schechter stand as infamous exceptions to

the general rule. The Court has never since invalidated any statute on

nondelegation grounds; nor had it done so before.

5

To the confusion of

1

293 U.S. 388, 408–09 (1935).

2

295 U.S. 495, 521–22 (1935).

3

Panama Refining, 293 U.S. at 430.

4

Schechter, 295 U.S. at 541–42.

5

See, e.g., Mistretta v. United States, 488 U.S. 361, 373 (1989) (“Until 1935, this Court

never struck down a challenged statute on delegation grounds. After invalidating in 1935

two statutes as excessive delegations . . . we have upheld, again without deviation, Congress’

1232 Virginia Law Review [Vol. 104:1229

lower courts and the frustration of legal scholars, sweeping grants of

what appear to be embarrassingly legislative powers have been

consistently upheld against nondelegation challenges,

6

often with less of

an intelligible principle to circumscribe their exercise than the stricken

NIRA provisions afforded.

7

Still, it is difficult to claim that this leniency is wrong, as there has

never been any widely accepted view of what exactly the nondelegation

principle demands. The Constitution contains no nondelegation clause,

and the line of Supreme Court decisions developing this limitation has

never more than feebly gestured at the motivating theory behind the

principle. Over the decades, arguments have been made against the

delegation of legislative powers on textual grounds,

8

on separation-of-

powers principles,

9

on analogy to the common law of agency,

10

and on

functional considerations about political accountability, comparative

expertise, and the costs of lawmaking.

11

The Court has at times adopted

ability to delegate power under broad standards.” (citations omitted)). One special-case

exception is Carter v. Carter Coal Co., involving the delegation of lawmaking powers to

“private persons whose interests may be and often are adverse to the interests of [those they

would regulate].” 298 U.S. 238, 311 (1936). The Court rejected this scheme as “legislative

delegation in its most obnoxious form.” Id.

6

See Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 474–75 (2001) (enumerating

broad delegations of rulemaking authority upheld on nondelegation challenges); Clinton v.

City of New York, 524 U.S. 417, 471–72 (1998) (Breyer, J., dissenting) (detailing historic

hesitancy to invalidate statutes on nondelegation grounds).

7

See, e.g., Kenneth Culp Davis, A New Approach to Delegation, 36 U. Chi. L. Rev. 713,

715 & n.3 (1969) (citing cases in which the Supreme Court found delegations constitutional

“without pretending to find statutory standards”); James O. Freedman, Review, Delegation

of Power and Institutional Competence, 43 U. Chi. L. Rev. 307, 307 n.6 (1976) (citing

standards such as “public convenience, interest or necessity” and “unfair methods of

competition” as evidence that “the requirement of a prescribed standard has proven so

expansive that it has had little inhibiting effect”).

8

See, e.g., Gary Lawson, Delegation and Original Meaning, 88 Va. L. Rev. 327, 345–51

(2002) (arguing that the text of Article I of the Constitution constitutes a limitation on the

delegation of the legislative power by Congress).

9

See, e.g., Peter H. Aranson, Ernest Gellhorn & Glen O. Robinson, A Theory of Legisl-

ative Delegation, 68 Cornell L. Rev. 1, 2–5 (1982) (describing the pragmatic separation-of-

powers approach to nondelegation questions).

10

See, e.g., Cynthia R. Farina, Deconstructing Nondelegation, 33 Harv. J.L. & Pub. Pol’y

87, 91 (2010) (considering how agency law might inform nondelegation cases).

11

See, e.g., David Schoenbrod, Power Without Responsibility: How Congress Abuses the

People Through Delegation 8–12 (1993) (arguing for a more robust nondelegation principle

to increase legislative accountability, among other things). But cf. Mistretta v. United States,

488 U.S. 361, 372 (1989) (making the similarly functional argument that “our jurisprudence

has been driven by a practical understanding that in our increasingly complex society,

2018] Game Theory and the Nondelegation Principle 1233

aspects of all these approaches. Yet all of them share two disquieting

properties. First, none of them can easily reconcile the nondelegation

principle with the existence of the modern administrative state; at least,

not without either hollowing the nondelegation principle or demanding

radical reorganization of government. Second, none of them can explain

the Court’s intelligible principle test. As Larry Alexander and Saikrishna

Prakash put it, no one but the Supreme Court “adopts the view that what

distinguishes constitutional grants of discretion from unconstitutional

delegations of legislative power is the presence or absence of an

intelligible principle.”

12

This Article aims to clarify both the nondelegation principle and the

intelligible principle test. It does so not by simplifying the theory, but by

complicating it. The thesis of this Article is that nondelegation analysis

is not a one-prong question: whether a statue delegates rulemaking

authority of the type that should be exercised by the legislature. Rather,

nondelegation analysis requires a two-prong inquiry in every case. In

addition to the usual question, whether delegated authority is of a type

that should be exercised by the legislature, there is always a second

question to address: whether, and to what extent, Congress has actually

delegated power over lawmaking outcomes at all.

This Article’s approach to the puzzle of nondelegation differs from

the literature in two ways. First, the Article does not singularly focus on

any existing constitutional theory of nondelegation, but instead aims to

show how constitutional structure and game theory inform all existing

theories of nondelegation.

13

Second, in giving meaning to the prohibited

act of delegating “legislative power,” this Article sets aside historic

efforts to define the meaning of legislative power, to instead focus on

the second part of the concept—what it means for Congress to delegate

replete with ever changing and more technical problems, Congress simply cannot do its job

absent an ability to delegate power under broad general directives”).

12

Larry Alexander & Saikrishna Prakash, Delegation Really Running Riot, 93 Va. L.

Rev. 1035, 1044 (2007); see also Freedman, supra note 7, at 307 (“Because the results the

Court has reached have often seemed inconsistent with the principles it has stated in

reaching them, the non-delegation doctrine has long been regarded as theoretically

unsatisfactory.”). But cf. Maurice H. Merrill, Standards—A Safeguard for the Exercise of

Delegated Power, 47 Neb. L. Rev. 469, 473–79 (1968) (describing some potential benefits

that flow from definite limiting standards).

13

See generally Charles L. Black, Jr., Structure and Relationship in Constitutional Law

(1969) (providing a seminal argument for the use of governmental structure and

organizational relationship as tools of constitutional interpretation).

1234 Virginia Law Review [Vol. 104:1229

legislative power. While both concepts are integral to the nondelegation

principle, the latter is underappreciated in the constitutional literature,

and may be the more influential consideration in practice.

The following pages develop this theory of nondelegation with rigor,

but the core logic of the argument is easily summarized. Consider two

extremes. First, imagine that Congress were able to delegate lawmaking

authority to an agency under an incentive structure that made it in the

agency’s interests to exercise its discretion only as Congress would have

done in the agency’s position. In this case, plenary lawmaking authority

could be given to the agency without transferring to it “power” in the

sense of actual discretion over the lawmaking outcome. The agency

would be authorized to exercise lawmaking powers, but would lack the

power to do anything other than what Congress would itself do. Since

no power has been transferred to the agency in this hypothetical,

legislative power has not been transferred, and the nondelegation

prohibition should stand silent. Second, suppose that Congress is not in

any way able to incentivize the agency to act as Congress would in the

agency’s position. Every grant of lawmaking authority necessarily

transfers plenary lawmaking power to the agency, but that transfer still

only offends the nondelegation principle when the delegated power is

legislative in nature. While this second extreme is the focus of most

constitutional nondelegation scholarship, a middle ground between

extremes is where most cases probably fall; and it is here that a more

mature theory of the nondelegation principle emerges.

This two-prong theory of nondelegation suggests an interpretation of

the intelligible principle test that places the needed degree of textual

specificity on a sliding scale. In situations where Congress seems well

equipped to incentivize agency action (where delegation transfers little

lawmaking power to the agency), the need for an intelligible principle is

low. Vague standards meet the need. But as the challenge of

incentivization rises (as monitoring problems, frictions in Congress’s

ability to react to agency lawmaking, and disconnects in the relationship

between the agency and Congress imply that a delegation would transfer

more substantial lawmaking power to the agency), the need for an

intelligible principle also rises. More exacting statements of policy,

standards, and procedure are needed as the credibility of incentivization

fades.

2018] Game Theory and the Nondelegation Principle 1235

This theory of nondelegation stands at the intersection of three

separate literatures. One is the constitutional literature on nondelegation,

which seeks to justify the nondelegation principle on textual,

philosophical, legal, and functional grounds.

14

This literature has

generally focused on defining the concept of legislative power, and the

proposed theory can be seen as a generalization of its results. A second

literature approaches nondelegation issues from the administrative-law

perspective of seeking safeguards, procedures, and ultra vires review as

limits on the exercise of agency discretion.

15

The proposed theory

emphasizes many of the same factors, but the focus is broader than these

protections, and the concern is with political review (not judicial review)

of agency lawmaking. The third literature involves game-theoretic

analyses of principal–agent models of delegated discretion.

16

The

proposed theory uses results from this literature as the vehicle for a

constitutional interpretation of what it means to have legislative power.

Put another way, this Article combines three strands of research in an

effort to formulate a more general theory of the nondelegation principle.

The remainder of this Article proceeds as follows. The next Part

orients the argument within scholarship and case law on the legislative

nondelegation principle. The Article then defines the meaning of “power

to make law” in the context of an informal game-theoretic model of

delegations of lawmaking authority. Relying upon this definition of

14

These theories are surveyed in Section 0.

15

E.g., Lisa Schultz Bressman, Schechter Poultry at the Millennium: A Delegation

Doctrine for the Administrative State, 109 Yale L.J. 1399, 1402 (2000) (suggesting a theory

of nondelegation in which procedural protections advance normative concerns about rule of

law and accountability); Davis, supra note 7, at 729–30 (focusing on procedural safeguards

and judicial review as limits on agency regulatory discretion).

16

E.g., Randall L. Calvert, Mathew D. McCubbins & Barry R. Weingast, A Theory of

Political Control and Agency Discretion, 33 Am. J. Pol. Sci. 588, 589 (1989); Mathew D.

McCubbins, Roger G. Noll & Barry R. Weingast, Administrative Procedures as Instruments

of Political Control, 3 J.L. Econ. & Org. 243, 246 (1987) [hereinafter McCubbins et al.,

Administrative Procedures] (focusing on administrative procedures and political control as

limits on agency discretion). See generally Jean-Jacques Laffont & David Martimort, The

Theory of Incentives: The Principal–Agent Model 33–36 (2002) (providing a comprehensive

introduction to principal-agent models in general game theory); Sean Gailmard,

Accountability and Principal–Agent Theory, in The Oxford Handbook of Public

Accountability 90 (Mark Bovens et al. eds., 2014) (summarizing work on principal-agent

models of legislative delegations); Mathew D. McCubbins, Common Agency? Legislatures

and Bureaucracies, in The Oxford Handbook of Legislative Studies 567–68 (Shane Martin et

al. eds., 2014) [hereinafter McCubbins, Common Agency] (surveying the history and

modern subparts of game theoretic study of legislative delegations in particular).

1236 Virginia Law Review [Vol. 104:1229

power, the Article proposes a two-pronged theory of nondelegation,

informed not only by the text of the empowering statute, but also by an

inquiry into the dynamics of the relationship between Congress and the

agency, and thus the extent of the agency’s power to legislate. The

proposed theory of nondelegation is developed to supply a context-

dependent intelligible principle test, which seems to fit comfortably

within the language and results of existing case law. The Article

concludes with remarks about the factors relevant to proper

nondelegation analysis and the use of game theory as a tool of

constitutional interpretation.

II. THE CHALLENGE OF NONDELEGATION

Suppose that Congress enacts a statute giving rulemaking authority to

some independent or executive agency.

17

Suppose further that this

statute falls within Congress’s enumerated powers and satisfies the usual

constitutional requirements of bicameralism, presentment, etc.

18

The

delegation is nonexclusive in the horizontal sense that nothing prevents

Congress from vesting parallel authority in another agency,

19

and in the

vertical sense that Congress retains superior authority to legislate on

anything within the scope of the delegated subject matter.

20

Is this

delegation of rulemaking authority constitutionally permissible?

It is generally agreed that Congress does have some constitutional

power to delegate discretionary authority in this manner. The power to

do so might be read to flow from the Necessary and Proper Clause of the

17

The Administrative Procedure Act’s (“APA”) broad definition of “agency” as

including, subject to a few enumerated exceptions, “each authority of the Government of the

United States, whether or not it is within or subject to review by another agency,” more than

suffices to describe the scope of the present inquiry. 5 U.S.C. § 551 (2012). The

constitutionality of agencies themselves is at least arguably implied by the Take Care

Clause. U.S. Const. art. II, § 3 (“[The President] shall take Care that the Laws be faithfully

executed, and shall Commission all the Officers of the United States”).

18

See U.S. Const. art. I, §§ 7–8.

19

See Alexander & Prakash, supra note 12, at 1040 (“[N]othing prevents Congress from

granting two or more entities rulemaking power over the same area.”). For example, the

Federal Trade Commission and the Department of Justice have concurrent jurisdiction over

the enforcement of several federal antitrust laws.

20

See id. (“Congress retains the ability to enact statutes itself. Any statute subsequently

enacted by Congress would trump any inconsistent rules made under the auspices of a

delegation.”); see also R. Douglas Arnold, Political Control of Administrative Officials, 3

J.L. Econ. & Org. 279, 280–81 (1987) (listing ways that Congress may legislatively and

nonlegislatively modify earlier grants of authority).

2018] Game Theory and the Nondelegation Principle 1237

Constitution.

21

Or it might simply be taken as given under existing case

law.

22

The Court has never seriously denied that Congress has the power

to commit certain discretionary decisions to agencies,

23

and even its rare

invalidation of a statute on nondelegation grounds in Panama Refining

was clear about Congress’s base authority to delegate.

24

Because Congress has some power to delegate, the hypothetical

delegation of rulemaking authority could be constitutionally permissible.

But it could also be invalid on nondelegation grounds. When would this

occur? The doctrinal answer is easy: a delegation of lawmaking

authority is unconstitutional when the empowering statute lacks an

intelligible principle to circumscribe the agency’s exercise of discretion.

But what exactly this test requires—and why—is more difficult to say.

A. The Intelligible Principle Requirement

For better or worse, it is fairly easy to recount the history and modern

expression of the constitutional nondelegation doctrine. The Supreme

Court’s struggle with congressional delegations of lawmaking authority

dates back to at least the mid-nineteenth century.

25

From the start, the

Court candidly admitted the difficulty of the task. In 1825, Chief Justice

21

U.S. Const. art. I, § 8, cl. 18; see also Lawson, supra note 8, at 345–51 (discussing the

limitations of the Necessary and Proper Clause as a justification for delegating some

rulemaking authority).

22

See, e.g., Loving v. United States, 517 U.S. 748, 758 (1996) (“This Court established

long ago that Congress must be permitted to delegate to others at least some authority that it

could exercise itself.”).

23

See, e.g., Buttfield v. Stranahan, 192 U.S. 470, 496 (1904) (“Congress legislated on the

subject as far as was reasonably practicable . . . . To deny the power of Congress to delegate

[residual] duty would, in effect, amount but to declaring that the plenary power vested in

Congress to [legislate] could not be efficaciously exerted.”); see also Lichter v. United

States, 334 U.S. 742, 778 (1948) (“A constitutional power implies a power of delegation of

authority under it sufficient to effect its purposes.”).

24

293 U.S. 388, 421 (1935) (“Without capacity to give authorizations of [some] sort [of

rulemaking discretion to agencies] we should have the anomaly of a legislative power which

in many circumstances calling for its exertion would be but a futility.”).

25

The case usually cited as the earliest expression of the legislative nondelegation

principle is Cargo of the Brig Aurora v. United States, 11 U.S. (7 Cranch) 382 (1813), in

which counsel for the appellant argued (without citation) that “Congress could not transfer

the legislative power to the President.” Id. at 386. The Court was not required to explore this

argument in any detail, as the challenged act was a simple application of conditional

legislation. See also Field v. Clark, 143 U.S. 649, 681 (1892) (discussing counsel’s argument

about Congress’s ability to delegate its legislative power to the President); Wayman v.

Southard, 23 U.S. (10 Wheat.) 1, 42–49 (1825) (similar); Cincinnati, Wilmington &

Zanesville R.R. v. Comm’rs of Clinton Cty., 1 Ohio St. 77, 87 (1852) (similar).

1238 Virginia Law Review [Vol. 104:1229

Marshall cited fuzziness in the boundaries of the legislative and

executive functions as grounds for judicial caution:

[T]he legislature makes, the executive executes, and the judiciary

construes the law; but the maker of the law may commit something to

the discretion of the other departments, and the precise boundary of

this power is a subject of delicate and difficult inquiry, into which a

Court will not enter unnecessarily.

26

The challenge of locating the line between those actions that

Congress must make for itself, and those that can be properly ascribed to

an agency in its execution of law, remains the central difficulty in

implementing the nondelegation principle today. Notwithstanding a few

efforts at distinguishing more important matters of policy from less

important matters,

27

at distinguishing those acts of Congress which

convey legislative authority in a “real” or “just” sense from those that do

not,

28

and at distinguishing laws featuring “legislative character in the

highest sense of the term” from those that “savor[] somewhat of mere

rules prescribed [on an individualized basis],”

29

the Court’s test of

whether a statute unconstitutionally delegates legislative power soon

converged on the current search for an intelligible principle.

The leading authority for the intelligible principle requirement is the

1928 case of J. W. Hampton, Jr., & Co. v. United States.

30

Chief Justice

Taft explained the test as follows: “If Congress shall lay down by

legislative act an intelligible principle to which the person or body

26

Wayman, 23 U.S. (10 Wheat.) at 46. Wayman actually involved a congressional grant

of authority to the judiciary, but the proposition applies just as well to congressional grants

of rulemaking authority to agencies.

27

E.g., id. at 43 (“The line has not been exactly drawn which separates those important

subjects, which must be entirely regulated by the legislature itself, from those of less

interest, in which a general provision may be made, and power given to those who are to act

under such general provisions to fill up the details.”).

28

E.g., Union Bridge Co. v. United States, 204 U.S. 364, 385 (1907) (“In no substantial,

just sense does it confer upon that officer as the head of an Executive Department powers

strictly legislative or judicial in their nature, or which must be exclusively exercised by

Congress or by the courts.” (emphasis added)); Buttfield, 192 U.S. at 496 (“[The statute]

does not, in any real sense, invest administrative officials with the power of legislation.

Congress legislated on the subject as far as was reasonably practicable, and . . . [left] to

executive officials the duty of bringing about the result pointed out by the statute.”

(emphasis added)).

29

Butte City Water Co. v. Baker, 196 U.S. 119, 126 (1905).

30

276 U.S. 394 (1928).

2018] Game Theory and the Nondelegation Principle 1239

authorized [to make substantive law] is directed to conform, such

legislative action is not a forbidden delegation of legislative power.”

31

The idea is that if Congress has sufficiently “indicated its will” in the

empowering statute, then the delegation is not legislative.

32

Or, to put it

succinctly, delegations of rulemaking authority conveyed under the limit

of an intelligible statement of congressional intent are allowed; those

without the limit of an intelligible principle are prohibited.

33

But what is the measure of an intelligible principle? To how fine a

degree must Congress direct the conduct of the agent if the delegation is

to escape invalidation? As far as the practical mechanics of the test were

concerned, J. W. Hampton, Jr., & Co. merely offered that “the extent

and character of [the conveyance of lawmaking authority] must be fixed

according to common sense and the inherent necessities of the

governmental co-ordination.”

34

Unsurprisingly, given this noncommittal

statement of the standard, the apparent focus of the Court’s intelligible

principle inquiry has wandered over time.

In Panama Refining and Schechter, for example, the requirement of

an intelligible principle seemed like a demand that Congress determine

for itself the substantive policy of delegated rulemaking, as well as the

standards and procedures by which rules would be promulgated.

35

The

agency’s only role was to “fill in the blanks” left by Congress.

36

This

high demand for congressional specificity, and the corresponding

subordination of agency discretion in lawmaking, is in some ways

reminiscent of earlier judicial efforts at separating important matters

31

Id. at 409.

32

United States v. Grimaud, 220 U.S. 506, 517 (1911); accord Margaret H. Lemos, The

Other Delegate: Judicially Administered Statutes and the Nondelegation Doctrine, 81 S. Cal.

L. Rev. 405, 417 (2008) (summarizing the logic as follows: “So long as Congress has

specified the general policy and standards . . . it has not ceded the essential ‘legislative

power’ that it alone holds, and citizens . . . can respond in the voting booth if they disagree

with the policy choices Congress made.”).

33

See Alexander & Prakash, supra note 12, at 1043–45 (providing a similar summary, as

well as serious criticism of the intelligible principle requirement).

34

J. W. Hampton, Jr., & Co., 276 U.S. at 406.

35

See supra notes 1-4 and accompanying text.

36

See Indus. Union Dep’t v. Am. Petroleum Inst., 448 U.S. 607, 675 (1980) (Rehnquist,

J., concurring) (reading Panama Refining and Schechter as demanding that Congress “lay

down the general policy and standards that animate the law,” so that the agency need only

“refine those standards, fill in the blanks, or apply the standards to particular cases” (internal

quotation marks omitted)).

1240 Virginia Law Review [Vol. 104:1229

(which Congress had to decide for itself) from less important matters

(which it could validly delegate).

37

But Panama Refining and Schechter represent a high-water line in the

Court’s demand of congressional specificity, and—as already noted—

are atomistic in the Court’s decisions. In other cases, the Court has

shown impressive comfort with a lack of congressional specificity.

These cases often point to mediating considerations in lieu of statutory

specificity, or in excuse of it.

In some cases, for example, the Court has focused on a tribunal’s

ability to engage in ultra vires review of an agency’s exercise of its

lawmaking discretion. In Yakus v. United States, decided a mere decade

after Panama Refining and Schechter, the Court stressed judicial review

of agency rulemaking as the apparent measure of an intelligible

principle: an empowering statute would be found lacking only if “it

would be impossible in a proper proceeding to ascertain whether the will

of Congress has been obeyed.”

38

This reasoning has motivated other

Supreme Court decisions,

39

and has undergirded influential lower court

opinions as well.

40

The apparent reasoning is that ultra vires review

completes the delegation scheme by ensuring that the agent does not

exceed the scope of its authority.

41

Put another way, “[p]rivate rights are

protected by access to the courts to test the application of the policy in

the light of [the intelligible principle],” however broad that might be.

42

37

See supra note 27.

38

321 U.S. 414, 426 (1944).

39

See, e.g., Skinner v. Mid-Am. Pipeline Co., 490 U.S. 212, 218 (1989) (“Earlier this

Term . . . [we] reaffirmed our longstanding principle that so long as Congress provides an

administrative agency with standards guiding its actions such that a court could ascertain

whether the will of Congress has been obeyed, no delegation of legislative authority . . . has

occurred.” (citations and internal quotation marks omitted)).

40

See Amalgamated Meat Cutters & Butcher Workmen of N. Am. v. Connally, 337 F.

Supp. 737, 746 (D.D.C. 1971) (citing “compatibility with the legislative design” as assessed

by “the courts and the public” as a source of “control and accountability” on which the

nondelegation principle is premised).

41

E.g., Touby v. United States, 500 U.S. 160, 170 (1991) (Marshall, J., concurring)

(“[J]udicial review perfects a delegated-lawmaking scheme by assuring that the exercise of

such power remains within statutory bounds.”); Ethyl Corp. v. EPA, 541 F.2d 1, 68 (D.C.

Cir. 1976) (en banc) (Leventhal, J., concurring) (“Congress has been willing to delegate its

legislative powers broadly—and courts have upheld such delegation—because there is court

review to assure that the agency exercises the delegated power within statutory limits . . . .”

(citation omitted)).

42

Am. Power & Light Co. v. SEC, 329 U.S. 90, 105 (1946); see also Cynthia R. Farina,

Statutory Interpretation and the Balance of Power in the Administrative State, 89 Colum. L.

2018] Game Theory and the Nondelegation Principle 1241

In other cases, the Court’s focus has seemed to turn on the scope of

discretion given to the agency in comparison to the extent of policy

direction and procedure imposed on that discretion by Congress.

Concern with the scope of delegated authority was apparent in the

Court’s opinion in Schechter.

43

But recent cases have been even more

explicit. In Whitman v. American Trucking Associations, for example,

the Court stated baldly that “the degree of agency discretion that is

acceptable varies according to the scope of the power congressionally

conferred.”

44

Other cases have hinted that the need for specificity may

also vary according to existing agency expertise and authority.

45

Finally, in other cases the intelligible principle test is presented and

applied in terms suggesting that it is little more than hollow formality.

The Court has long disclaimed that the nondelegation principle “does

not demand the impossible or the impracticable.”

46

But does it demand

anything at all? In Whitman, the Court acknowledged that it has “almost

never felt qualified to second-guess Congress regarding the permissible

degree of policy judgment that can be left to those executing or applying

the law.”

47

Governmental pragmatism and the difficulty of the problem are

reasonable justifications for hesitating to enforce the nondelegation

principle too rigorously,

48

but few perceive any threat of

overapplication. Modern decisions openly admit the record of limp

Rev. 452, 486 (1989) (“After Yakus, the constitutionally relevant inquiry is . . . whether

[Congress] supplied enough policy structure that someone can police what its delegee is

doing . . . .”).

43

Schechter, 295 U.S. at 541–42 (condemning the statute “[i]n view of the scope of that

broad declaration, and of the nature of the few restrictions that are imposed”).

44

531 U.S. 457, 475 (2001).

45

See, e.g., Loving v. United States, 517 U.S. 748, 772 (1996) (“Perhaps more explicit

guidance as to how to select aggravating factors would be necessary if delegation were made

to a newly created entity without independent authority in the area.”).

46

See, e.g., Yakus, 321 U.S. at 424 (“The Constitution as a continuously operative charter

of government does not demand the impossible or the impracticable. It does not require that

Congress find for itself every fact upon which it desires to base legislative action . . . .”).

47

Whitman, 531 U.S. at 474–75 (quoting Mistretta v. United States, 488 U.S. 361, 416

(1989) (Scalia, J., dissenting)).

48

See, e.g., Mistretta, 488 U.S. at 372 (“[O]ur jurisprudence has been driven by a

practical understanding that in our increasingly complex society, replete with ever changing

and more technical problems, Congress simply cannot do its job absent an ability to delegate

power under broad general directives.”); supra note 26 and accompanying text (describing

the difficulty of the nondelegation inquiry).

1242 Virginia Law Review [Vol. 104:1229

standards that have satisfied the intelligible principle test,

49

and

academic commentary is no more delicate. K.C. Davis long ago wrote

that “[o]ne cannot read the many Supreme Court opinions revolving

around standards without realizing the emptiness of the insistence,”

continuing that “[n]othing should hinge upon [the] presence or absence

of such vague phrases as ‘public interest’ or ‘just and reasonable.’”

50

Gary Lawson puts it even more directly: “[The Court] . . . has

steadfastly found intelligible principles where less discerning readers

find gibberish.”

51

B. Theories of Legislative Nondelegation

One constant in the Court’s otherwise-inconsistent treatment of

nondelegation challenges is its insistence that there is some such

constitutional limitation. Cases routinely begin with the recitation that

delegations of the legislative power are unconstitutional. If so, where is

this limitation found? Nothing in the text of the Constitution speaks to

the delegation of legislative powers one way or the other.

52

Early nondelegation opinions dodged the question by simply asserting

that the legislative power could not be delegated. An example is the

proclamation of Field v. Clark, stating without citing any authority:

“That Congress cannot delegate legislative power to the President is a

principle universally recognized as vital to the integrity and maintenance

of the system of government ordained by the Constitution.”

53

Over the

years, the Court has hinted at various bases for the principle—most

often the text of Article I or separation-of-powers principles—but

exactly because opinions have entertained many different thoughts on

49

See, e.g., Whitman, 531 U.S. at 474 (collecting vague standards that the Court has

found to satisfy the intelligible principle requirement); Mistretta, 488 U.S. at 416 (Scalia, J.,

dissenting) (“What legislated standard, one must wonder, can possibly be too vague to

survive judicial scrutiny, when we have repeatedly upheld, in various contexts, a ‘public

interest’ standard?”).

50

1 Kenneth Culp Davis, Administrative Law Treatise § 2.04, at 87 (1958).

51

See Lawson, supra note 8, at 328–29.

52

Cf. id. at 335–43 (arguing that lack of an express nondelegation clause is not, as a

matter of constitutional interpretation, evidence of the absence of this principle).

53

143 U.S. 649, 692 (1892); see also Wayman v. Southard, 23 U.S. (10 Wheat.) 1, 42–43

(1825) (stating, in dicta and without citation, that “[i]t will not be contended that Congress

can delegate to the Courts, or to any other tribunals, powers which are strictly and

exclusively legislative”).

2018] Game Theory and the Nondelegation Principle 1243

what motivates the nondelegation principle, uncertainty about the

principle’s constitutional authority remains.

54

As a rough approximation, four broad theories are often suggested as

potential bases for the nondelegation principle. The first is a textual

interpretation of the Article I Vesting Clause as an implicit statement of

the nondelegation principle. The second is a derivation of the

nondelegation principle from separation-of-powers principles. The third

is an argument by analogy, inferring the nondelegation principle from

rules in the common law of agency. The fourth is a catchall category,

consisting of a variety of arguments for and against the delegation of

legislative powers on functional and normative grounds. As explained in

detail below, none of these theories easily explain the existence of the

modern administrative state alongside a substantive nondelegation

principle, and none can explain the intelligible principle test by which

the Court has historically reviewed nondelegation challenges.

1. Textual Arguments

The simplest theory of nondelegation infers the principle from the

text of the Article I Vesting Clause, which provides that “All legislative

Powers herein granted shall be vested in a Congress of the United

States.”

55

The text of the Article I Vesting Clause differs subtly from the

vesting clauses in Articles II and III, which provide, respectively, that

“The executive Power shall be vested in a President,”

56

and “The

judicial Power of the United States, shall be vested in one supreme

Court.”

57

Sometimes on the support of this subtle difference, sometimes

independent of it, the textual argument for nondelegation reads the

Article I Vesting Cause as an exclusive grant of lawmaking authority to

Congress: that is, as providing that the legislative power shall only be

vested in Congress.

The Court has in some cases adopted this textual reading explicitly,

58

but the argument is vulnerable to the powerful rebuttal that the same text

54

See generally Whitman, 531 U.S. at 459 (2001) (revealing disagreement between the

justices over the source and demands of the nondelegation principle).

55

U.S. Const. art. I, § 1 (emphasis added).

56

Id. art. II, § 1 (emphasis added).

57

Id. art. III, § 1 (emphasis added).

58

E.g., Whitman, 531 U.S. at 472 (“Article I, § 1, of the Constitution vests ‘[a]ll

legislative Powers herein granted . . . in a Congress of the United States.’ This text permits

no delegation of those powers . . . .”).

1244 Virginia Law Review [Vol. 104:1229

can just as plausibly be read as a nonexclusive grant of authority. As

Justice Stevens has written: “In Article I, the Framers vested “All

legislative Powers” in the Congress just as in Article II they vested the

“executive Power” in the President. Those provisions do not purport to

limit the authority of either recipient of power to delegate authority to

others.”

59

Prominent scholars have expressed similar doubts about this

textual theory of the nondelegation principle.

60

But even supposing that the textual theory of nondelegation is right,

the implied nondelegation principle becomes exactly the “delicate and

difficult inquiry” that Justice Marshall warned about in Wayman v.

Southard.

61

That is, a statute which delegates the exercise of “legislative

power” is invalid, while a statute which merely authorizes executory

rulemaking is not.

62

The concept of “legislative power” is not defined in

the Constitution,

63

so to operationalize this textual theory of the

nondelegation principle one must first shoulder the withering

responsibility of deciding what it means to exercise legislative power.

As you might expect, there is ample disagreement about what the

legislative power entails, and different definitions result in profoundly

different versions of the nondelegation principle. Lawson, for example,

draws the line between legislation and execution on the importance of

the delegated responsibility.

64

The implied nondelegation principle is

this: “Congress must make whatever policy decisions are sufficiently

59

Id. at 489 (Stevens, J., concurring in part and in the judgement) (citations omitted).

60

1 Kenneth Culp Davis & Richard J. Pierce, Jr., Administrative Law Treatise § 2.6, at 66

(3d ed. 1994) (“The Court probably was mistaken from the outset in interpreting Article I’s

grant of power to Congress as an implicit limit on Congress’ authority to delegate legislative

power.”).

61

23 U.S. (10 Wheat.) 1, 42–49 (1825); see supra note 26 and accompanying text.

62

See Mistretta v. United States, 488 U.S. 361, 419–20 (1989) (Scalia, J., dissenting)

(stating and defending this formal distinction).

63

See Gary Lawson, The Rise and Rise of the Administrative State, 107 Harv. L. Rev.

1231, 1238 n.45 (1994) (noting that even the framers of the Constitution recognized that

“legislative power” was not self-defining). See generally William B. Gwyn, The

Indeterminacy of the Separation of Powers and the Federal Courts, 57 Geo. Wash. L. Rev.

474 (1989) (discussing the development of and disagreement surrounding the meaning of

“executive power” as used in the Constitution).

64

Lawson, supra note 63, at 1237–41. Note that Lawson’s argument on this point is far

more subtle and careful than this short summary suggests. See also Amalgamated Meat

Cutters & Butcher Workmen of N. Am. v. Connally, 337 F. Supp. 737, 745 (D.D.C. 1971)

(“There is no analytical difference, no difference in kind, between the legislative function—

of prescribing rules for the future—that is exercised by the legislature or by the agency

implementing the authority conferred by the legislature. The problem is one of limits.”).

2018] Game Theory and the Nondelegation Principle 1245

important to the statutory scheme at issue so that Congress must make

them,” and what remains may be validly delegated to an agent as

necessary and proper.

65

By contrast, Eric Posner and Adrian Vermeule

argue that the legislative power is simply the de jure powers of the

members of Congress—such as the authority to vote on proposed

legislation.

66

By this standard, any delegation of lawmaking authority

short of the full abdication of the de jure powers of a congressperson is

permissible under the nondelegation principle.

Two unsettling propositions are apparent. First, the textual theory of

the nondelegation principle cannot easily reconcile a serious

nondelegation principle with the modern administrative state. Either the

principle has bite (as in Lawson’s view), in which case many Supreme

Court opinions have been wrong and much of modern government must

be disassembled, or the principle lacks bite (as in Posner and

Vermeule’s view), in which case the nondelegation principle is far more

trivial than even the most apologetic Supreme Court cases have

suggested. Second, in any event, the textual theory gives no plausible

basis for thinking that constitutionality should turn on the presence or

absence of a potentially weak intelligible principle in the empowering

statute.

67

2. Separation-of-Powers Principles

Similar to the textual theory, but more flexible, is a theory of

nondelegation based on separation-of-powers principles popular at the

time of the Founding and ostensibly embedded in the Constitution’s

separate assignment of the legislative, executive, and judicial powers to

the three respective branches of the federal government.

68

The Court has

often cited separation-of-powers principles as the basis for the

65

Lawson, supra note 63, at 1239; see also Gary Lawson, Delegation and the

Constitution, 22 Reg. 23, 27–29 (1999) (making a similar argument).

66

Eric A. Posner & Adrian Vermeule, Interring the Nondelegation Doctrine, 69 U. Chi. L.

Rev. 1721, 1723 (2002). Posner and Vermeule’s argument is, again, more nuanced and

sophisticated than this short summary suggests.

67

See Alexander & Prakash, supra note 12, at 1044 (arguing that “an intelligible principle

that barely (if at all) cabins rulemaking discretion” cannot plausibly define the boundary of

the legislative power); see also David Schoenbrod, The Delegation Doctrine: Could the

Court Give It Substance?, 83 Mich. L. Rev. 1223, 1229 (1985) (commenting on the practical

weakness of the “intelligible principle” constraint).

68

See supra notes 55–57 and accompanying text (discussing the three vesting clauses).

1246 Virginia Law Review [Vol. 104:1229

nondelegation principle.

69

But, just as was the case for the textual theory

of nondelegation, the separation-of-powers theory is susceptible to

various interpretations.

70

The core difficulty is deciding what the

separation-of-powers principle actually prohibits Congress from doing.

A formalist understanding of the separation-of-powers principle may

simply restate the textualist theory of nondelegation. That is, all power

defined as legislative must be strictly and exclusively exercised by the

legislature, so the nondelegation question would again be a matter of

characterizing power as legislative or executive in nature. The previous

analysis of the textual theory of nondelegation applies in full to this

view of the separation-of-powers principle. While the Supreme Court

has a few times come close to this rigid understanding of the separation

of powers,

71

in most cases it adopts a more flexible approach.

72

The typical functionalist understanding of the separation-of-powers

principle focuses less on the character of a delegation as legislative or

executive than on the effects of delegation on governmental balance.

The Court has at times gone far to this functionalist extreme, rejecting

the “archaic view of . . . three airtight departments of government” in

favor of a constitutional inquiry into “whether [an] Act disrupts the

proper balance” of the branches of government.

73

The corresponding

theory of nondelegation prohibits only undue delegations of power—

those that would disrupt this proper balance.

69

See, e.g., Mistretta v. United States, 488 U.S. 361, 371–72 (1989) (“The nondelegation

doctrine is rooted in the principle of separation of powers that underlies our tripartite system

of Government . . . . [W]e long have insisted that the integrity and maintenance of the

system of government ordained by the Constitution mandate that Congress generally cannot

delegate its legislative power to another Branch.” (internal quotation marks omitted)).

70

See Thomas O. Sargentich, The Contemporary Debate About Legislative-Executive

Separation of Powers, 72 Cornell L. Rev. 430, 438–44 (1987) (describing and comparing

checks-and-balances arguments supporting different degrees of judicial intervention in

separation-of-powers cases).

71

See, e.g., Kilbourn v. Thompson, 103 U.S. 168, 191 (1880) (“[It is] essential to the

successful working of this [constitutional] system that the persons intrusted [sic] with power

in any one of these branches shall not be permitted to encroach upon the powers confided to

the others, but that each shall by the law of its creation be limited to the exercise of the

powers appropriate to its own department and no other.”).

72

See, e.g., Buckley v. Valeo, 424 U.S. 1, 121 (1976) (“[T]he Constitution by no means

contemplates total separation [of powers] . . . . The men who met in Philadelphia in the

summer of 1787 . . . saw that a hermetic sealing off of the three branches . . . would preclude

the establishment of a Nation capable of governing itself effectively.”).

73

Nixon v. Adm’r of Gen. Servs., 433 U.S. 425, 443 (1977) (internal quotation marks

omitted) (quoting Nixon v. Adm’r of Gen Servs., 408 F. Supp. 321, 342 (D.D.C. 1976)).

2018] Game Theory and the Nondelegation Principle 1247

What “proper balance” entails is an open question, but nondelegation

cases that emphasize this functional view of the separation-of-powers

principle have typically followed Madison’s writings.

74

That is, the

constitutional question is operationalized, as illustrated in Mistretta v.

United States, as asking whether a delegation of rulemaking authority is

subject to adequate checks and balances:

In adopting this flexible understanding of separation of powers, we

simply have recognized Madison’s teaching that the greatest security

against tyranny—the accumulation of excessive authority in a single

Branch—lies not in a hermetic division among the Branches, but in a

carefully crafted system of checked and balanced power within each

Branch.

75

This approach has obvious connections to the Court’s occasional

focus on the ability of courts to engage in ultra vires review of agency

actions as a check on agency discretion.

76

And it finds support in

academic suggestions that standards, procedures, and judicial review

constitute the checks on agency action that may make broad delegations

of lawmaking power constitutional.

77

But, again, a cursory overview of the theory is enough to

highlight disquieting issues. On a formalist approach, the separation-of-

powers theory is essentially the same as the textualist theory of

nondelegation. It is difficult to reconcile with modern government, and

at any rate does not explain the intelligible principle test. On a

functionalist approach, the separation-of-powers theory is more

consistent with expansive delegations of legislative power, but even here

it appears to anticipate more specificity in an intelligible principle than

the Supreme Court has historically demanded. It is difficult to envision

judicial review of agency rulemaking for consistency with a “public

interest” standard as the kind of check on power that Madison was

contemplating.

78

74

See The Federalist No. 47 (James Madison) (arguing that the commingling of powers

does not violate separation-of-powers principles).

75

488 U.S. 361, 381 (1989).

76

See supra notes 38–42 and accompanying text.

77

Bressman, supra note 15, at 1415–16, 1425–26; Davis, supra note 7, at 729–30.

78

E.g., Nat’l Broad. Co. v. United States, 319 U.S. 190, 225–26 (1943) (finding “public

interest, convenience, or necessity” a sufficiently intelligible principle).

1248 Virginia Law Review [Vol. 104:1229

3. Common Law Principles of Agency

Another theory of nondelegation derives this constitutional limitation

not from the text or structure of the Constitution but from background

concepts in the common law of agency. The argument is often

associated with the agency-law maxim delegata potestas non potest

delegari (delegated authority cannot be further delegated),

79

ostensibly

known to the Founders at the time of the drafting.

80

An old state court

case captures the spirit of this theory of nondelegation:

That a power conferred upon an agent because of his fitness and the

confidence reposed in him cannot be delegated by him to another, is a

general and admitted rule. Legislatures stand in this relation to the

people whom they represent. Hence it is a cardinal principle of

representative government, that the legislature cannot delegate the

power to make laws to any other body or authority.

81

Unfortunately, it is not that simple. First, it is hardly obvious that the

common law of agency is a proper source of constitutional authority for

limiting the powers of the political branches of government. Second,

even assuming it is, the authority and meaning of the delegata potestas

maxim are less certain than they may at first appear. In a detailed

historical review, Patrick Duff and Horace Whiteside long ago argued

that the accepted form of the maxim was actually the result of a printing

error. The earliest authoritative assertion of the maxim seems not to

have stated the now familiar rule that restricts delegations, but rather the

extremely permissive proposition that the “King’s power is not

diminished by its delegation to others.”

82

79

See, e.g., J. W. Hampton, Jr., & Co., 276 U.S. at 405–06 (“The well-known maxim

‘Delegata potestas non potest delegari’ . . . is well understood and has had wider application

in the construction of our Federal and State Constitutions than it has in private law.”).

80

Cf. Mistretta, 488 U.S. at 419–20 (Scalia, J., dissenting) (“As John Locke put it almost

300 years ago, ‘[t]he power of the legislative being derived from the people by a positive

voluntary grant and institution, can be no other, than what the positive grant conveyed,

which being only to make laws, and not to make legislators, the legislative can have no

power to transfer their authority of making laws, and place it in other hands.’” (quoting John

Locke, Second Treatise of Government 87 (Richard H. Cox ed., Harlan Davidson, Inc. 1982)

(1689))).

81

Locke’s Appeal, 72 Pa. 491, 494 (1873).

82

Patrick W. Duff & Horace E. Whiteside, Delegata Potestas Non Potest Delegari: A

Maxim of American Constitutional Law, 14 Cornell L.Q. 168, 173 (1929).

2018] Game Theory and the Nondelegation Principle 1249

Third, even giving the delegata potestas maxim the full constitutional

credit of its modern meaning in the law of agency, the common law of

agency is still not as rigid as it might at first appear. As Cynthia Farina

explains, the delegata potestas maxim was never the end of common

law analysis on the fitness of an agent to delegate authority to a

subagent.

83

For example, the common law historically allowed an agent

to delegate incidental, mechanical, and ministerial acts to a subagent.

84

And the general rule against subdelegation also excepted subdelegation

with the express assent of the principal,

85

or with implied assent in the

event of substantially changed conditions.

86

Thus, like the previous approaches, the agency-law theory of

nondelegation admits different interpretations of the limitation. It might

be understood to allow any delegation of rulemaking authority which

does not diminish the power of Congress to legislate,

87

something close

to Posner and Vermeule’s nondelegation principle.

88

It might permit

only incidental delegations of lawmaking authority, subject to major

policy choices made by Congress, something similar to Lawson’s

83

Farina, supra note 10, at 91–93 (noting that the delegata potestas maxim “only begins

the analysis” as other common law rules allowed the delegation of power over incidental and

necessary matters where reasonable or with the principal’s consent). See generally

Restatement (First) of Agency §§ 34–35, 77–80 (1933) (describing conditions under which

delegations of authority may include authority to act beyond the express terms of the

delegation).

84

E.g., id. § 78 (1933) (“Unless otherwise agreed, authority to conduct a transaction does

not include authority to delegate to another the performance of acts incidental thereto which

involve discretion or the agent’s special skill; such authority, however, includes authority to

delegate to a subagent the performance of incidental mechanical and ministerial acts.”

(emphasis added)).

85

E.g., Warner v. Martin, 52 U.S. 209, 223 (1850) (interpreting the delegata potestas

maxim to mean the agent “cannot depute the [delegated] power to a clerk or under agent,

notwithstanding any usage of trade, unless by express assent of the principal” (emphasis

added)).

86

See Farina, supra note 10, at 93 (explaining that under substantially changed

circumstances, assent to the agent’s necessary exercise of expanded authority may be

“reasonably inferred if ‘the principal is aware of the change and its effect and is in a position

to change his orders if he desires such change’” (quoting Restatement (First) of Agency § 33

cmt. a (1933)).

87

Cf. Louis L. Jaffe, An Essay on Delegation of Legislative Power: II, 47 Colum. L. Rev.

561, 565 (1947) (summarizing this theory as a simple rule that “as long as the legislature

may repeal a law, all delegations are valid”).

88

See supra note 66.

1250 Virginia Law Review [Vol. 104:1229

nondelegation principle.

89

Or it might be somewhere in between,

allowing for the delegation of lawmaking authority where necessitated

by circumstances and where the public is aware of the practice and

consents to it.

As before, these theories of the nondelegation principle square with

the modern administrative state only insofar as they limit the practical

significance of the principle, perhaps by reading a congressional right to

delegate broad lawmaking authority as expressly or impliedly authorized

by the public. Also, nothing in any of these agency-law theories of

nondelegation explains why the presence or absence of a potentially

vague expression of congressional intent should supply the

constitutional test of validity.

4. Functional Governance Concerns

Finally, myriad nondelegation theories flow from functional concerns

about the legislative process and the ends of lawmaking. These are not

necessarily constitutional concerns; some simply reflect important

normative desiderata of lawmaking and democratic government. Nor are

these concerns of one mind on the proper scope of delegations of

lawmaking authority. Indeed, they run the gamut from harshly critical of

legislative delegations to warmly accepting.

For example, a common prodelegation consideration is the idea that

Congress needs to delegate broadly if government is to keep pace with

growing regulatory needs. The Supreme Court has often used practical

necessity to argue for broad delegations, citing the “hard-headed

practicalit[y]” that “Congress frequently could not perform its

functions” if it were required to legislate specifically on every topic as

leaving broad-stroke delegation “the only way in which the legislative

process can go forward.”

90

It is not just delegation but weakly

constrained delegation that makes this process workable.

91

89

See supra notes 64–65 and accompanying text (briefly summarizing Lawson’s theory of

the nondelegation principle).

90

Bowles v. Willingham, 321 U.S. 503, 515 (1944); see also Loving v. United States, 517

U.S. 748, 758 (1996) (“To burden Congress with all federal rulemaking would divert that

branch from more pressing issues, and defeat the Framers’ design of a workable National

Government.”); Mistretta, 488 U.S. at 372 (“[O]ur jurisprudence has been driven by a

practical understanding that in our increasingly complex society, replete with ever changing

and more technical problems, Congress simply cannot do its job absent an ability to delegate

power under broad general directives.”); Am. Power & Light Co. v. SEC, 329 U.S. 90, 105

2018] Game Theory and the Nondelegation Principle 1251

There are other prodelegation functional considerations as well. For

example, delegation of lawmaking responsibility to unpolitical subject-

matter experts may reduce the costs of legislation.

92

Delegation of

lawmaking power may improve the overall quality of the laws being

enacted because of the more decentralized process through which

decisions are made.

93

And delegation may promote greater consistency

and transparency in lawmaking through agency notice procedures,

interested-party involvement, and similar practices.

94

But antidelegation functional concerns are available for nearly all of

these arguments. Opposing the idea that delegation is necessary to meet

the modern demand for regulation is concern that broad delegations of

legislative power allow Congress to legislate too much.

95

Opposing the

benefit of reducing the cost of lawmaking through delegation is concern

that many cost reductions arise from circumventing constitutional

hurdles to legislation.

96

Opposing the notion that agencies may pass

(1946) (“The legislative process would frequently bog down if Congress were

constitutionally required to appraise beforehand the myriad situations to which it wishes a

particular policy to be applied and to formulate specific rules for each situation. Necessity

therefore fixes a point beyond which it is unreasonable and impracticable to compel

Congress to prescribe detailed rules . . . .”).

91

Davis, supra note 7, at 720 (“A modern regulatory agency would probably be an

impossibility if power could not be delegated with vague standards.”).

92

E.g., Aranson et al., supra note 9, at 18 (commenting that delegations trade

“congressional decision costs” for “agency costs”); Richard J. Pierc e, Jr., Political

Accountability and Delegated Power: A Response to Professor Lowi, 36 Am. U. L. Rev.

391, 404 (1987) (“Agencies encounter much lower transaction costs than Congress.”).

93

E.g., Davis, supra note 7, at 726 (“[Courts] should [admit] that putting the content of

the Code of Federal Regulations through the congressional enacting process would mean

worse government, not better government, because Congress is and should be geared to

major policies and main outlines, and administrators are better able to legislate the relative

details . . . .”); see also Richard B. Stewart, Beyond Delegation Doctrine, 36 Am. U. L. Rev.

323, 329–35 (1987) (making a similar point in greater detail).

94

See, e.g., Jerry L. Mashaw, Prodelegation: Why Administrators Should Make Political

Decisions, 1 J.L. Econ. & Org. 81, 99 (1985) (noting the ways that agency procedures may

lead to more stable and transparent operation than congressional voting would).

95

See Farina, supra note 10, at 95–98 (summarizing and commenting on these functional

concerns about excessive lawmaking).

96

See Alexander & Prakash, supra note 12, at 1049–54 (noting that delegation

circumvents various Article I, Section 7 requirements); Jonathan R. Macey, Promoting

Public-Regarding Legislation Through Statutory Interpretation: An Interest Group Model, 86

Colum. L. Rev. 223, 247–49 (1986) (discussing law and economics insights into the role of

bicameralism in shaping the outcome of legislation); David Schoenbrod, Separation of

Powers and the Powers That Be: The Constitutional Purposes of the Delegation Doctrine, 36

1252 Virginia Law Review [Vol. 104:1229

better laws than Congress are concerns about the rule of law when

agencies generate voluminous codes of specific rules; about democratic

accountability for laws passed by politically insulated agencies;

97

and

about policy drift and agency capture when agencies interact closely and

repeatedly with the same interest groups they are meant to regulate.

98

These antidelegation concerns are themselves susceptible to attack,

99

the end result being that functional theories of the nondelegation

principle range from permissive to extremely restrictive, depending on

what concerns motivate the inquiry and what weight the various factors

are given. For present purposes, it suffices to note two things. First, none

of these functional concerns seems able to simultaneously justify a

serious nondelegation principle and the modern administrative state.

Second, none of these functional concerns relates at all to the modern

doctrinal test of constitutional validity—the presence or absence of a

potentially vague intelligible principle in the authorizing statute.

III. GAME THEORY & THE POWER TO LEGISLATE

Existing theories of the nondelegation principle are diverse and

divergent, as this brief summary shows. But they share in common an

effort to define the scope of lawmaking powers that Congress should not

be permitted to delegate. Abusing terminology, they all focus on trying

to define the meaning of legislative powers.

100

This Article charts a

Am. U. L. Rev. 355, 371–87 (1987) (summarizing the procedural protections built into

congressional legislation).

97

See generally Theodore J. Lowi, Two Roads to Serfdom: Liberalism, Conservatism and

Administrative Power, 36 Am. U. L. Rev. 295 (1987) (arguing that broad, unrestricted

delegations of discretionary power are antithetical to the rule of law); Theodore J. Lowi, The

End of Liberalism: The Second Republic of the United States (2d ed. 1979) (same); see also

Sargentich, supra note 70, at 448–64 (discussing the argument for, and limitations of, this

rule-of-law interpretation of the nondelegation principle).

98

See David B. Spence & Frank Cross, A Public Choice Case for the Administrative

State, 89 Geo. L.J. 97, 114–15 (2000) (summarizing the literature and providing prominent

citations); see also Thomas W. Merrill, Rethinking Article I, Section 1: From Nondelegation

to Exclusive Delegation, 104 Colum. L. Rev. 2097, 2142–45 (2004) [hereinafter Merrill

2004] (summarizing these concerns). See generally Thomas W. Merrill, Capture Theory and

the Courts: 1967–1983, 72 Chi.-Kent L. Rev. 1039 (1997) (giving a broader discussion of

capture-theory concerns).

99

See generally George I. Lovell, That Sick Chicken Won’t Hunt: The Limits of a

Judicially Enforced Non-Delegation Doctrine, 17 Const. Comment. 79 (2000) (offering

persuasive criticisms of many of these antidelegation functional concerns).

100

In a textual approach, this is the literal question. In a separation-of-powers theory, the

legislative power may take on a broader meaning of the power that cannot be given to

2018] Game Theory and the Nondelegation Principle 1253

different course. It aims to clarify the nondelegation principle by instead

focusing on the second part of the prohibited act: trying to say what it

means for an agency to exercise legislative power.

An immediate difficulty is the expansive list of possible definitions of

power, itself an abstract term. A thorough treatment of the universe of

possibilities is beyond the scope of this Article.

101

It is also unnecessary.

In the constitutional context, the concept of power is not as malleable as

it might at first seem, since purely formal motions of lawmaking are not

at issue. Congress has the technical capacity, for example, to pass a

statute dissolving the judicial and executive branches of government.

But since the Supreme Court would judge this unconstitutional, and

since the President would most likely decline to enforce it at any rate,

there is no constitutional cause for alarm. A reasonable description of

the situation is to say that while Congress could technically vote out

such a statute, it lacks the power, in our constitutional system, to effect

this outcome. A like concept is needed for an agency’s power to

exercise the authority delegated to it by Congress.

The remainder of this Part defines an agency’s power to legislate by

analogy to a variety of principal-agent games. Game theory, a

mathematic framework for studying conflict and cooperation among

actors with interdependent preferences,

102

has long been used to study

delegations of discretion.

103

Game theory not only provides a precise

another branch without disrupting the balance of government. In analogy to the law of

agency, the legislative power is that for which Congress does not have authority to

subdelegate. In a functional approach, the legislative power encompasses the scope of

decisions that must be made by Congress to satisfy relevant functional objectives.

101

See, e.g., Steven Lukes, Power: A Radical View (2d ed. 2005) (reproducing and

commenting on one of the earlier and more influential efforts to systematically define power

in a social framework); Thomas E. Wartenberg, The Forms of Power: From Domination to

Transformation (1990) (incorporating many different theories of power in a pluralistic

model); Robert A. Dahl, The Concept of Power, 2 Behavioral Sci. 201 (1957) (providing an

influential definition of power in a legislative context).

102

See generally Robert Gibbons, Game Theory for Applied Economists (1992)

(providing an accessible introduction to game theory); Roger B. Myerson, Game Theory:

Analysis of Conflict (1991) (providing a more rigorous introduction).

103

See, e.g., Sean Gailmard, Accountability and Principal-Agent Theory, in The Oxford

Handbook of Public Accountability 90 (Mark Bovens et al. eds., 2014) (summarizing work

on principal-agent models of legislative delegations); Jerry L. Mashaw, Greed, Chaos, and

Governance: Using Public Choice to Improve Public Law ch. 6–7 (1997) (applying game

theory and public choice concepts to various issues around delegations of legislative

powers); Matthew [sic] D. McCubbins et al., Structure and Process, Politics and Policy:

Administrative Arrangements and the Political Control of Agencies, 75 Va. L. Rev. 431,

1254 Virginia Law Review [Vol. 104:1229

definition of an agency’s power to legislate, but also suggests what

factors may increase or decrease an agency’s legislative power.

A. The Definition of Legislative Power

In game theory, it is common to refer to an actor’s ability to influence

the outcome of a game as the actor’s “power.” Examples include voting

power (the ability of a given voter to influence the outcome of a voting

process),

104

bargaining power (the ability of a negotiating party to

secure an agreement that benefits that party),

105

and market power (the

ability of a firm to raise prices above a competitive baseline).

106

Generalizing this terminology, power in game theory is the ability to

influence the outcome of a process that is subject to the influence of

multiple actors.

107

Influence, here, can be either direct control over an

outcome (like casting a vote) or indirect control over an outcome (like

using the threat of future punishment to compel someone else to cast a

vote). This concept of power requires not just the ability to take an

action affecting the outcome of a game, but also the willingness to take

such an action, in light of the actions that other agents are expected to

take. Max Weber long ago captured the core idea: “‘Power’ . . . is the

433–34 (1989) (studying a three-party principal-agent model of delegations of policy

discretion).

104

See, e.g., Guillermo Owen, Evaluation of a Presidential Election Game, 69 Am. Pol.

Sci. Rev. 947 (1975) (illustrating this definition in a game-theory voting model). See

generally Matthew Braham, Causation and the Measurement of Power, in Power, Voting,

and Voting Power: 30 Years After, at 63–69 (Manfred J. Holler & Hannu Nurmi eds., 2013)

(discussing this definition of voting power and related indexes of voter power).

105

See, e.g., Stefan Napel, Bilateral Bargaining: Theory and Applications 27 (2002)

(using bargaining power in the typical sense of ability to direct the division of profit in a

structured noncooperative bargaining game); id. at 13 (using bargaining power in the also-

typical sense of player-weights in a cooperative bargaining game).

106

See, e.g., Jonathan B. Baker & Timothy F. Bresnahan, Economic Evidence in

Antitrust: Defining Markets and Measuring Market Power, in Handbook of Antitrust

Economics 1, 15 (Paolo Buccirossi ed., 2008) (defining market power as “the ability of firms

to raise price above the competitive level for a sustained period”); Massimo Motta,

Competition Policy: Theory and Practice 40–41 (2004) (similar).

107

See generally Rodolfo Coelho Prates, Power in Game Theory, in 7 Contributions To

Game Theory And Management 282 (Leon A. Petrosyan & Nikolay A. Zenkevich eds.,

2014) (summarizing concepts of power and suggesting how power arguments might be

added to game theoretic frameworks); Wolfgang Balzer, Game Theory and Power Theory: A

Critical Comparison, in Rethinking Power 56 (Thomas E. Wartenberg ed., 1992)

(contrasting game theory with alternative but similar formal models of power).

2018] Game Theory and the Nondelegation Principle 1255

probability that one actor within a social relationship will be in a

position to carry out his own will despite resistance [from others].”

108

This notion of power as capacity to influence the outcome of a game

despite resistance will be familiar to any student of constitutional or

administrative law. It is the essential concept of power implicit in

Madison’s emphasis of constitutional checks and balances in preventing

the tyrannous abuse of power.

109

The same idea of power is also implicit

in concerns about the abuse of unchecked agency discretion in the

administrative-law context.

110

Delegations of legislative power create principal-agent relationships

in both economic and legal senses of the term,

111

and the game theory

concept of power translates easily to the principal-agent game between

Congress and an empowered agency. At a high level of abstraction, the

“legislative delegation game” involves three decisions. First,

Congress—the principal—specifies the subject-matter domain in which

the agency is authorized to make laws. Second, the agency decides what

laws to promulgate within the scope of authority delegated to it by

Congress. Third, Congress may respond in some way: possibly

legislating on its own to override the agency’s lawmaking or possibly

using budgetary control to punish or reward the agency for its

lawmaking decisions.

112

108

Max Weber, Economy and Society: An Outline of Interpretive Sociology 53 (Guenther

Roth & Claus Wittich eds., 1968).

109

See supra note 74 and accompanying text (discussing Madison’s interpretation of the

separation-of-powers principle in Federalist 47); see also Youngstown Sheet & Tube Co. v.

Sawyer, 343 U.S. 579, 635 (1952) (Jackson, J., concurring in the judgement) (“The actual art

of governing under our Constitution does not and cannot conform to judicial definitions of

the power of any of its branches based on isolated clauses or even single Articles torn from

context.”).

110

E.g., Davis, supra note 50, § 1.09, at 68 (“We have had [in drafting organic statutes]

little or no concern for avoiding a mixture of three or more kinds of powers in the same

agency; we have had much concern for avoiding or minimizing unchecked power.”).

111

See Restatement (Third) Of Agency § 1.01 (2006) (“[Legal] [a]gency is the fiduciary

relationship that arises when one person (a ‘principal’) manifests assent to another person

(an ‘agent’) that the agent shall act on the principal’s behalf and subject to the principal’s

control, and the agent manifests assent or otherwise consents so to act.”); Stephen A. Ross,

The Economic Theory of Agency: The Principal’s Problem, 63 Am. Econ. Rev. 134, 134

(1973) (“We will say that an [economic] agency relationship has arisen between two (or

more) parties when one, designated as the agent, acts for, on behalf of, or as representative

for the other, designated the principal, in a particular domain of decision problems.”).

112

See Peter H. Schuck, Delegation and Democracy: Comments on David Schoenbrod,

20 Cardozo L. Rev. 775, 785–86 (1999) (suggesting that the appropriations process “sharply

constrains the authority and discretion of agencies” through “the language of the funding

1256 Virginia Law Review [Vol. 104:1229

To operationalize the model, assume that both Congress and the

agency have well-defined preferences.

113

Though far from innocuous,

this technical assumption is not novel to this Article and—as a modeling

exercise—helps to reveal broader legal principles.

114

It is not necessary

to take a stand, here, on what exactly congressional and agency

preferences entail.

115

For present purposes, it suffices to say that

Congress and the agency are assumed not to have entirely identical

preferences on all matters—which seems a fairly safe assumption.

Defining “power” in the game theory sense of ability to exercise

influence over the outcome of a game, the agency’s legislative power in

the principal-agent game is its ability to enact laws that Congress would

not itself enact if given the choice.

116

To make this concrete, note that

Congress is assumed to have a preferred choice of what laws the agency

should enact—call this

𝐿"

. But the agency, too, has a preferred choice of

which laws to enact, which will not generally coincide with the

preferences of Congress—call the laws that the agency would prefer to

enact

𝐿#

. Congress and the agency may both influence the outcome of

the agency’s lawmaking decision in this game—call the resulting law

that the agency actually enacts

𝐿#

∗

. In terms of the above definition of

power, the extent of the agency’s legislative power is the distance

between its actual choice of law in the game and the choice that

legislation, through formal committee and subcommittee oversight hearings, and through the

frequent informal interactions between members and agency officials”).

113

Technically, assume that both Congress and the agency have state-independent

von Neumann-Morgenstern utility functions and act as expected utility maximizers.

114

Much has been written about the complexity of defining preferences for aggregate

bodies such as Congress or a federal agency. These challenges fall no harder against the

following analysis than they do against the many papers that have attempted to model

agencies’ exercise of discretionary authority, that have assumed the existence of voter

preferences in more than the most trivial applications of majority voting, or that have ever

relied upon the notion of legislative intent in statutory interpretation.

115

Cf. McCubbins, Common Agency?, supra note 16, at 578 (discussing various theories

of agency preferences, but also the absence of much hard evidence supporting these

theories).

116

The reader might note that this implicitly assumes congressional legislation is the

baseline against which power is measured. Nearly all concepts of power require some choice

of baseline. See Harald Wiese, Applying Cooperative Game Theory to Power Relations, 43

Quality & Quantity 519, 520 (2009) (arguing that “every fruitful definition of power-over

needs a reference point which may concern a ‘usual’, ‘normal’, or ‘moral’ situation”). In the

nondelegation context, constitutional comfort with congressional legislation recommends

using Congress’s policy preferences as the reference point.

2018] Game Theory and the Nondelegation Principle 1257

Congress would have preferred the agency make: |

𝐿#

∗− 𝐿"

|.

117

A similar

idea of agency “discretion” appears in the game theory literature on the

behavior of agencies when delegated legislative responsibilities.

118

Intuitively, the agency’s power to legislate is the discretion it has to

enact laws different than those the legislature would want it to enact, in

light of whatever resistance it can expect from Congress. In Part IV of

this Article, I defend the constitutional significance of this concept of

agency power. For now, however, the pressing question is whether and

why the agency should be expected to exercise legislative power at all.

That is, when and why would

𝐿#

∗≠ 𝐿"

.

B. One-Shot Delegation Conveys Legislative Power

Start with the simplistic game in which Congress decides the scope of

authority to delegate to the agency, the agency legislates within the

scope of its authority, and then Congress has an opportunity to respond

by passing its own legislation or punishing or rewarding the agency.

Suppose this game is played once and then ends forever: in the

terminology of game theory, it is a “one-shot game.”

If Congress had all the same information as the agency, then it could

use its third move in the principal-agent game to constrain the agency’s

exercise of lawmaking discretion to always coincide with congressional

preferences. As a trivial example, Congress could simply watch the law

that the agency enacts, and if it differs from

𝐿"

, Congress could either

punish the agency severely or simply override it statutorily. Knowing

that Congress would respond this way, the agency would have no reason

to even try to deviate from Congress’s legislative preferences, and so

would legislate exactly as Congress would:

𝐿#

∗= 𝐿"

.

119

And knowing

that the agency would be so constrained, Congress could grant it very

117

For brevity, discussion delves no deeper into the interpretation of these outcomes as

either points in high-dimensional policy space or payoffs resulting from a policy choice. See

id. at 520–21(providing high level discussion and citations for this type of distinction). In

either event, a reasonable distance concept would exist.

118

Calvert et al., supra note 16, at 597 (defining agency “discretion” in a similar sense for

regulatory choices in a policy space).

119

See Laffont & Martimort, supra note 16, at 33–36 (illustrating optimal-contract logic

when the principal has the same information as the agent); Calvert et al., supra note 16, at

595 (noting that with perfect information “the legislature and executive have complete

control over the policy outcome [of agency lawmaking]”). But cf. McCubbins et al., supra

note 103, at 435–40 (emphasizing that the need for coalition action by multiple principals

can result in uncontrollable agency lawmaking, even with perfect information).

1258 Virginia Law Review [Vol. 104:1229

broad legislative authority without actually transferring to it any power

over the lawmaking outcome. The agency would be exercising

legislative powers, but Congress would retain all the legislative

power.

120

Of course, the massive assumption on which this result is premised is

that Congress has available to it all the information available to the

agency—which is unlikely to be true. The very reasons that Congress

might delegate lawmaking responsibilities in the first place are to free

up congressional resources and to gain the benefit of agency expertise

and learning on topics beyond the ken of legislators.

121

These benefits

will only exist when Congress faces informational disparities relative to

the agency.

122

That is, Congress only benefits from the subject-matter

expertise of the agency when it lacks the agency’s informational

expertise; and Congress only frees up its own resources when it

delegates legislative responsibility without immediately turning around

to closely monitor every action the agency takes.

This disparity of information is important, because an empowered

agency has no latent incentive to enact Congress’s preferred choice of

laws. In the previous example, the agency expected Congress to respond

to any deviation from

𝐿"

in a way that made it pointless for the agency

to even try to deviate from congressional preferences in its lawmaking.

But if Congress lacks the ability or resources to monitor the agency’s

lawmaking, then the agency will generally be able to exercise its

legislative authority by enacting laws that take account of its own

legislative preferences. In general, this means that the agency will not

enact the laws that Congress would want it to enact:

𝐿#

∗≠ 𝐿"

. And in the

extreme where Congress has no ability to monitor or respond to the

agency’s exercise of lawmaking discretion, the agency will simply

legislate according to its own lawmaking preferences:

𝐿#

∗= 𝐿#

. This is

the maximum of agency legislative power: within the scope of its

120

This paraphrases a distinction expressed by Richard Neustadt in another context.

Richard E. Neustadt, Presidential Power and the Modern Presidents 10 (1990) (“In [the

preceding] words of a President, spoken on the job, one finds the essence of the problem

now before us: ‘powers’ are no guarantee of power; clerkship is no guarantee of

leadership.”).

121

See supra notes 92–94 and accompanying text (providing additional details).

122

Cf. Ross, supra note 111, at 134 (“The problems of agency are really most interesting

when seen as involving choice under uncertainty . . . .”).

2018] Game Theory and the Nondelegation Principle 1259

delegated authority, the agency’s influence over lawmaking outcomes is

plenary.

The forgoing is an intuitive explanation of an agency’s legislative

power when given lawmaking authority by Congress, but the intuition

rests on the support of decades of game theory scholarship. Whenever a

principal is modeled as having imperfect information, then under a wide

range of modeling decisions and assumptions, formal analysis of

principal-agent games always reveals a transfer of power to the agent.

123

Game theoretic analysis thus presents exactly the tradeoff emphasized in

the constitutional nondelegation literature: Congress can either legislate

specifically (limiting the agency’s legislative power but sacrificing

much of the benefits that could come from agency assistance), or it can

legislate broadly (gaining the benefits of agency assistance, but at the

cost of transferring legislative power to the agency).

124

C. Oversight and Procedure Dampen Legislative Power

Yet just how much power the agency has in even this simple one-shot

principal-agent game is debatable. As laid out above, the agency’s

lawmaking power is plenary within the delegated subject matter only

when Congress is assumed to have no information that it can use to

constrain the agency’s action. But there are many ways that Congress

might seek to gather and maintain information about the agency’s

lawmaking decisions. And the more it does so, the more the threat of

congressional overrides and punishment may deter the agency from

exercising its will in legislating other than as Congress would have it

do.

125

In the limit, as congressional monitoring of agency lawmaking

becomes perfect, the agency’s legislative power evaporates.

123

See generally Laffont & Martimort, supra note 16 (providing a detailed introduction to

major forms of the principal-agent game and the related theory of contractual

incentivization); Myerson, supra note 102, ch. 6 (providing a rigorous introduction to general

contracting problems, including the need to satisfy incentive compatibility and participation

constraints).

124

See generally Laffont & Martimort, supra note 16, ch. 2 (demonstrating this “rent

extraction-efficiency tradeoff” as a general property of principal-agent models); Gailmard,

supra note 103 (collecting and summarizing research showing the same rent extraction-

efficiency tradeoff in the specific context of principal-agent models of legislative

delegation).

125

See Arnold, supra note 20, at 279 (“Although [legislators] delegate [rulemaking]

authority out of necessity, they generally seek ways to monitor and control how bureaucrats

1260 Virginia Law Review [Vol. 104:1229

How might Congress improve its ability to monitor agency

lawmaking actions? The possibilities are endless. Congress could, for

example, appoint oversight committees to monitor specific agencies.

126

It could directly increase its expertise in a subject matter by forming

specialized committees with subject-matter expertise.

127

It could rely on

its voting constituents to bring its attention to any agency actions that

are inconsistent with the legislators’ political interests.

128

And it could

rely on an extensive apparatus of administrative procedures to reveal

and document how and why the agency is exercising its lawmaking

discretion.

Many administrative procedures are expressly directed at forcing

agencies to disclose information about their lawmaking activities. For

example, since 1935, the Federal Register Act has required agencies to

publish any documents they produce with “general applicability and

legal effect”

129

in the Federal Register. Since 1946, the Administrative

Procedure Act has allowed interested parties to receive notice of agency

lawmaking, and has given the public some ability to place its own

comments and relevant information on the public record.

130

And since

1996,

131

federal agencies have been required to give both houses of

Congress notice of any agency rulemaking,

132

and have had to wait sixty

days before a “major rule” can take effect, during which time Congress

may pass fast-track legislation to override an agency’s lawmaking

decisions.

133

These requirements are in addition to other more specific

exercise this authority. Their aim is to ensure that administrative decisions remain as close

as possible to those which they would otherwise make themselves.”) (emphasis added).

126

See Arnold, supra note 20, at 280 (discussing the role of congressional critiques of past

agency actions in directing future behavior); Schuck, supra note 112, at 785 (“Agencies fear

intrusive oversight and their decisions and behavior often reflect what political scientists

refer to as ‘anticipatory reaction’ to those controls.”).

127

See Sean Gailmard, Expertise, Subversion, and Bureaucratic Discretion, 18 J.L. Econ.

& Org. 536 (2002) (modeling the delegation decision as also including a congressional

option of gaining more expertise, which the authors find would be more frequently exercised

as congressional and agency preferences diverge).

128

See Mathew D. McCubbins & Thomas Schwartz, Congressional Oversight

Overlooked: Police Patrols Versus Fire Alarms, 28 Am. J. Pol. Sci. 165, 166 (1984)

(describing a theory of “fire alarm” oversight of agency action).

129

44 U.S.C. § 1505 (2012).

130

5 U.S.C. § 551 et seq. (2012).

131

Id. §§ 801–808 (2012).

132

Id. § 801(a)(1)(A).

133

Id. § 801(a)(3)(A). This 60-day window may be extended if Congress passes a joint

resolution of disapproval but is vetoed by the President. Id. § 801(a)(3)(B).

2018] Game Theory and the Nondelegation Principle 1261

notice procedures that may be built into individual empowering acts, or

that may apply to agencies as a whole.

134

Other administrative procedures indirectly force agencies to provide

Congress with information about their lawmaking decisions. The

availability of judicial review of agency actions,

135

for example, does

more than safeguard private interests against abuses of agency

discretion.

136

Just as other administrative procedures are information-

forcing in effect, the process of a private suit and judicial review of

agency actions brings attention to agency lawmaking and forces an

agency to disclose the basis and reasoning for its actions.

137

Like the

sixty-day waiting period for major rules, the dilatory and information-

forcing effects of private litigation give Congress both the opportunity

and means to take corrective measures if an agency deviates from

legislative preferences.

These administrative procedures are in addition to yet more

mechanisms by which Congress can gain information on agency

lawmaking. Appropriation and appointment procedures give Congress

regular opportunities to review and respond to agency behavior.

138

By

empowering multiple agencies with parallel authority, Congress may

benefit from competition between agencies, potentially giving Congress

access to information it would otherwise not get.

139

And the independent

134

For example, the 1970 National Environmental Protection Act requires that “to the

fullest extent possible” all agencies must issue “detailed statement[s]” of the potential

environmental impacts associated with any “major [actions they take] significantly affecting

the quality of the human environment.” 42 U.S.C. § 4332 (2012).

135

Courts have long understood the APA to raise a presumption of judicial review for

private parties affected by wrongful agency action. See, e.g., Abbott Labs. v. Gardner, 387

U.S. 136, 140 (1967). Exactly how much protection judicial review really provides is,

however, debatable. Compare Chevron U.S.A. Inc. v. Nat. Res. Def. Council, Inc., 467 U.S.

837, 865–66 (1984) (describing the strong deference that courts accord to agency

interpretations of ambiguous provisions in their own empowering statutes—what has come

to be called “Chevron deference”), wit h Schuck, supra note 112, at 788 (commenting that

while Chevron deference reduces the threat of judicial review, “courts can, and often do,

manipulate this doctrine in order to preserve much of their influence over agency decisions,

including enforcing agency fidelity to congressional intent”).

136

See supra note 15 and accompanying text (describing procedural safeguards as a

means of limiting abuse of discretion and of advancing rule of law).

137

Cf. McCubbins & Schwartz, supra note 128, at 166 (describing “fire-alarm”

oversight).

138

Cf. Calvert et al., supra note 16, at 593–99 (describing a principal-agent model of

legislative delegation including an appointment stage).

139

See Mathew D. McCubbins, Abdication or Delegation? Congress, the Bureaucracy,

and the Delegation Dilemma, 22 Reg. 30, 34 (1999) (“[A]gencies whose jurisdictions

1262 Virginia Law Review [Vol. 104:1229

oversight and reporting by popular media bodies provides yet another

source of information about agency actions.

140

In short, oversight and

the procedural forcing of information disclosure by agencies have grown

relentlessly since the early 1900s—to the point where some scholars

now argue that Congress has substantial information about agency

lawmaking and significant potential to incentivize agencies to legislate

according to congressional preferences.

141

A situation may have arisen

in which empowered agencies have, at most, limited legislative power.

D. Relationships Further Dampen Legislative Power

This still does not end the agency-power analysis. A qualification to

all the preceding discussion was that it applied to one-shot principal-

agent games in which Congress and the agency interacted one time only

and then the game ended. That’s obviously not how most delegations of

legislative power are actually structured. Many of the most interesting

delegations of lawmaking authority empower or even create agencies

that are expected to continue to exist and interact with Congress long

into the foreseeable future. What changes when the one-shot game is

played many times in sequence—approximating the continuous and

ongoing relationship between Congress and such agencies?

“What changes?” is potentially a lot. When the principal-agent game

is repeated many times in sequence, both Congress and the empowered

agency are able to condition their strategic interactions not just on the

actions each takes in a given stage of the repeated game, but also on the

entire history of play up to a given point. And when the one-shot game

overlap will compete for budgets and statutory authority, making it all the more necessary

for them to please political leaders.”); see also David M. Kreps, A Course in Microeconomic

Theory 610–11 (1990) (surveying game theory research on multiple-principal and multiple-

agent models).

140

See, e.g., Schuck, supra note 112, at 789–90 (commenting on the political control of

agencies through media oversight and reporting).

141

E.g., Calvert et al., supra note 16, at 590 (modeling political control of agency policy

discretion by both the legislative and executive branches); Arthur Lupia & Mathew D.

McCubbins, Representation or Abdication? How Citizens Use Institutions to Help

Delegation Succeed, 37 Eur. J. Pol. Res. 291, 296–301 (2000) (modeling how third-party

involvement relates to political control); McCubbins, supra note 139, at 33–37 (enumerating

strategies by which Congress may mitigate agencies’ exercise of policy discretion);

McCubbins et al., Administrative Procedures, supra note 16, at 253–64 (arguing that

administrative procedures enable Congress to overcome informational inequalities between

itself and agencies); Schuck, supra note 112, at 784–87 (noting the various ways that

Congress can exercise political control over agencies).

2018] Game Theory and the Nondelegation Principle 1263

is repeated an indefinite number of times—such that neither Congress

nor the agency can easily predict when their interactions will end—the

set of potential outcomes of the game expands dramatically.

A powerful set of results in the game theory literature on repeated

games is commonly referred to as the “folk theorem.”

142

In rough terms,

the folk theorem provides that, in any infinitely repeated game in which

the actors care enough about future iterations of the game, any outcome

better than the worst possible equilibrium in a single stage of the game

is supportable as an equilibrium of the infinitely repeated game.

143

Put

another way, outcomes that would not be possible in any single stage of

a principal-agent game might become possible when the actors repeat

their interaction an indefinite number of times in sequence.

144

To try to make this more concrete, indefinite repetition of the

legislative delegation game can be thought of as giving Congress two

more tools for monitoring and responding to agency lawmaking

decisions.

145

First, Congress’s ability to observe entire histories of play

allows it to monitor the agency more accurately—or at lower cost—than

would be possible in any single stage of the game. Second, Congress’s

ability to condition threats and rewards on the entire history of play

gives it a more robust club for responding to acts of agency lawmaking

than it may have in any single iteration of the principal-agent game.

These tools could significantly alter the distribution of power in the

principal-agent relationship. In a general principal-agent context, for

example, Roy Radner has shown that infinite repetition of the game can,

in theory, allow the principal to strongly constrain an agent’s discretion

without requiring the principal to invest in costly monitoring

142

This name owes to uncertainty over the initial authority for this type of theorem, which

was generally known through informal oral conversations between folk in the game-theory

community before it was rigorously formalized in any publication.

143

This is a very rough approximation to the real proposition. For a precise statement, see

Drew Fudenberg & Eric Maskin, The Folk Theorem in Repeated Games with Discounting

and with Incomplete Information, 54 Econometrica 533 (1986); Myerson, supra note 102, at

331–36.

144

See generally Laffont & Martimort, supra note 16, at ch. 8 (illustrating applications of

this reasoning to general principal-agent models).

145

See Roy Radner, Repeated Principal-Agent Games with Discounting, 53 Econometrica

1173, 1173–74 (1985) (suggesting the intuitive model where, instead of investing in costly

monitoring practices, the principal undertakes low-cost long-run statistical modeling of the

agent’s behavior, subject to a severe but self-enforcing threat of punishment if this

monitoring ever turns up abuses of the agency’s discretion).

1264 Virginia Law Review [Vol. 104:1229

measures.

146

This is a special case of a more general version of the folk

theorem, applicable to many games with imperfect information.

147

In

short, repetition of the principal-agent legislative delegation game may

enable Congress to significantly curtail an agency’s legislative power.

How would this work in practice? It would involve relational

incentivization of agency cooperation. Again, delegations of lawmaking

authority often create or empower agencies that will continue to enact

laws—and interact with Congress—long into the foreseeable future. In

each of its sessions, Congress has an opportunity to respond to acts of

lawmaking by the agency: legislatively overriding specific agency rules;

surgically using the appropriations process to reward or punish agencies,

or even specific divisions or regulatory actions of agencies;

148

holding

formal inquiries to publicly critique agency behavior;

149

modifying or

entirely revoking the very delegation of legislative powers to an agency.

These responses were possible in even the one-shot model of the game,

but infinite repetition allows them to be used differently: Congress can

effectively threaten long-term punishments and rewards to offset short-

term incentives for agencies to deviate from congressional preferences.

For example, Congress might give an agency broad legislative powers,

but subject to an understanding that it will curtail those powers, cut

funding, and maybe even dismantle the agency if Congress ever

concludes that agency lawmaking has deviated from its preferences. The

point of the folk theorem is that this type of strategy may in fact be a

146

Id.; see also Roy Radner, Monitoring Cooperative Agreements in a Repeated

Principal-Agent Relationship, 49 Econometrica 1127, 1127–28 (1981) (providing similar

results in the case of long, but not infinite, repetition of the game).

147

See generally Drew Fudenberg, David Levine & Eric Maskin, The Folk Theorem with

Imperfect Public Information, 62 Econometrica 997 (1994) (proving a general version of the

folk theorem).

148

See Arnold, supra note 20, at 280 (discussing the use of appropriations to reward

“bureaucrats who produce pleasing decisions” and to punish those who don’t); Schuck,

supra note 112, at 786 (commenting that “substantive controls on agency policymaking are

often included even in . . . omnibus budgetary reconciliation legislation”).

149

See Arnold, supra note 20, at 280:

Congressional committees hold extensive public hearings to inquire about past,

present, and future decisions. They can use the same hearings to communicate

congressional views about how administrative officials should adjust their decisions

to accommodate congressional preferences. Congressional committees also issue

detailed reports that critique past decisions and specify how agencies ought to decide

future cases. Most agencies treat the provisions in such committee reports, and

especially those in the reports of appropriations subcommittees, just as seriously as

they do statutory provisions.

2018] Game Theory and the Nondelegation Principle 1265

self-reinforcing equilibrium of the game—incentivizing the agency to

substitute Congress’s legislative preferences for its own because of the

severe threat of sanction, and incentivizing Congress to follow through

with the threat of sanction because doing so constricts the agency’s

legislative power under this long-run delegation scheme.

But the folk theorem is only a claim about feasibility. It shows that

relational incentivization could be relied upon to constrict an agency’s

legislative power—not that it can, would, or must be used to do so in

any given situation. In particular, the efficacy of this type of relational

incentivization strategy declines with the quality of information

available to Congress.

150

Relational incentivization may thus be seen as

a type of strong, informal constraint on agency power, and a potential

cost saver relative to explicit monitoring efforts. It is an important factor

to consider in assessing the extent of the agency’s legislative power, but

it does not change the fundamental relationship that agency power will

usually grow as the quality of Congress’s information declines.

E. Summary: Uncertainty of Legislative Power

The point of this analysis is not to say that congressional

incentivization of agency lawmaking should always be expected to

wrest all legislative power from the agency. Nor is the point to say that

an agency’s legislative power is plenary once authority is delegated by

Congress. Rather, the point is to say that the extent of an agency’s

legislative power in a delegation situation is always ex ante uncertain—a

fact-bound question that can only be addressed through specific inquiry

into the terms and context of particular delegations of lawmaking

authority.

I certainly do not claim that this fact-bound power inquiry is trivial.

Even this extended treatment of the inquiry omitted complications like

the need for bicameral support of congressional responses,

151

the

influence of executive involvement in delegations and legislative

responses,

152

and the need for agency constituents to be able to estimate

150

See Fudenberg et al., supra note 147, at 1034 (noting that “the equilibrium set

contracts as public outcomes reveal less and less information [about private actions]”).

151

See U.S. Const. art. I, §§ 7–8.

152

See McCubbins et al., supra note 103, at 435–40 (discussing the effects of shared

influence over agency decision making by Congress and the President); Calvert et al., supra

note 16, at 590–99 (same).

1266 Virginia Law Review [Vol. 104:1229

congressional preferences as part of any efficient cooperative

equilibrium of the game, all of which further complicates an already

involved analysis. But neither is the game theory literature silent on the

factors that contribute to or mitigate an agency’s legislative power. The

extent of apparent informational disparities, the availability and quality

of procedural controls and other tools for monitoring agency lawmaking

activities, and the possibility of strong incentivization of agency

lawmaking through long-run relational strategies are all factors to

consider in trying to gauge the extent of an agency’s legislative power

under a given delegation of lawmaking authority.

Though ultimately an empirical question, it seems only intuitive that

rarely will a delegation of lawmaking authority completely transfer

legislative power to an agency, or for that matter permit Congress to

retain all power over lawmaking outcomes.

153

In most cases, some

power will transfer with a delegation of lawmaking authority. But that

only tees up the interesting and important question: how much power?

IV. COMPLICATING THE NONDELEGATION PRINCIPLE

Constitutional theories of the nondelegation principle have for

decades argued that delegations of the legislative power are invalid.

Surprisingly little theoretical attention has been dedicated, however, to

trying to say what it means for an agency to have legislative power. The

game theory concept of power to make laws offers a precise definition

of legislative power. Adding this power concept to the nondelegation

proscription suggests a more complicated nondelegation principle. A

delegation of legislative powers will not offend the nondelegation

principle without the intersection of two conditions: first, the authority

delegated to the agency must be legislative in nature; and second, the

agency must have power to deviate from congressional preferences in

exercising this legislative authority. Of course, neither of these concepts

is truly binary. The practical question is whether the agency would be

given lawmaking authority that is too legislative in character, given the

power that the agency would have over lawmaking outcomes; whether

the agency would have too much power over lawmaking outcomes,

given the nature of the lawmaking authority it would be exercising. As

153

This is not a novel proposition. See Davis, supra note 50, § 2.16, at 153 (“[W]hen

power is delegated, no matter how complete the delegation may on its face seem to be, the

legislative body still has an effective voice in its exercise.”).

2018] Game Theory and the Nondelegation Principle 1267

the following pages show, this more complicated version of the

nondelegation principle generalizes existing scholarship and offers

insights into Supreme Court decisions and the intelligible principle test.

A. The Two-Prong Nondelegation Principle

This Article argues that no theory of the nondelegation principle can

properly consider the meaning of legislative to the exclusion of power.

How easy is it to retrofit existing constitutional theories of

nondelegation to include a separate power inquiry? As it turns out,

retrofitting existing theories is surprisingly easy. Most theories reveal an

intuitive connection to—and need for—agency power analysis.

1. Textual Theories

A textual theory of nondelegation, which derives the principle from

an exclusive reading of the vesting of “[a]ll legislative Powers” in “a

Congress of the United States,” expressly demands some definition of

what it means to exercise legislative power.

154

This Article proposes that

the game theory concept of power supplies this definition. This makes

particular sense in context. The oft-noted pragmatism of the Founders is

difficult to reconcile with the possibility that they intended the Vesting

Clause to refer only to formalistic notions of being vested in the

trappings of authority or going through the procedural motions of

making law, however futile they might be. Instead, as has been

constantly noted since before the ratification of the Constitution, a

system of checks and balances and a plan to maintain tension between

independent branches of government was implemented to restrain the

functional power of the government and to protect generally against

tyranny.

155

This is part and parcel of the game theory concept of power

to legislate.

154

U.S. Const. art. I, § 1. The Constitution vests the President with the “executive

Power,” U.S. Const. art. II, § 1, and the Supreme Court with the “judicial Power,” U.S.

Const. art. III, § 1. There seems little reason to read the plural form of the noun “powers” to

mean something different than “power” in Article I.

155

See, e.g., Richard E. Neustadt, Presidential Power: The Politics of Leadership 42

(1960) (“The constitutional convention of 1787 is supposed to have created a government of

‘separated powers.’ It did nothing of the sort. Rather, it created a government of separated

institutions sharing powers.”); Peter L. Strauss, The Place of Agencies in Government:

Separation of Powers and the Fourth Branch, 84 Colum. L. Rev. 573, 602 (1984) (“[T]he

governmental structure [the Framers] created embodies both separated powers and

1268 Virginia Law Review [Vol. 104:1229

A generalized textual theory of nondelegation proposes the intuitive

rule that Congress should be the entity that exercises lawmaking power

when the nature of this lawmaking is sufficiently legislative; this power,

however, may be discharged either by Congress legislating on its own,

or by Congress delegating legislative authority in a way that allows it to

retain sufficient power over the lawmaking outcome. In the negative,

Congress is only required to legislate specifically when it could not

otherwise retain for itself sufficient power over the agency’s lawmaking

decisions, and when these lawmaking decisions rise to the level of being

legislative in nature. The meaning of legislative power in this version of

the theory is that described at length in Part III. The meaning of

legislative power is a source of disagreement among scholars, but this

two-pronged approach seems to generalize any interpretation, and

makes intuitive sense in the context of existing theories.

Take Lawson’s interpretation of legislative power, which roughly

defines legislative powers as those policy decisions which Congress

must make because of their substantive importance.

156

The two-prong

version of this nondelegation theory embraces the exact same normative

judgment: if a policy decision is so important that Congress must make

it, then Congress must either legislate on its own or delegate lawmaking

responsibility in a way that ensures it retains tight control over the final

legislative outcome. Either way, Congress drives the bus.

Or take Posner and Vermeule’s quite different version of the textual

nondelegation principle, prohibiting only those delegations that rise to

the level of transferring the de jure powers of members of Congress.

157

This permissive view of the nondelegation principle admits trivial

generalization: since almost no delegation conveys legislative power

under this definition, even plenary conveyances of lawmaking power

interlocking responsibilities . . . . Maintaining conditions that would sustain the resulting

tension between executive and legislature was to be the central constraint on any proposed

structure for government.”); id. at 604 (“The Framers expected the branches to battle each

other to acquire and to defend power.”) (quoting Abraham D. Sofaer, War, Foreign Affairs

and Constitutional Power: The Origins 60 (1976)).

156

Lawson, supra note 63, at 1239 (“Congress must make whatever policy decisions are

sufficiently important . . . that Congress must make them.”); see also supra notes 64 & 65

and accompanying text (discussing Lawson’s theory of nondelegation).

157

Posner & Vermeule, supra note 66, at 1723 (“[T]he content of [the nondelegation]

prohibition is the following: Neither Congress nor its members may delegate to anyone else

the authority to vote on federal statutes or to exercise other de jure powers of federal

legislators.”); id. at 1726 (elaborating on this assertion).

2018] Game Theory and the Nondelegation Principle 1269

would remain constitutionally permissible. But Posner and Vermeule’s

theory points up a paradox that again reveals an intuitive connection to

the two-prong theory of nondelegation. Note that members of Congress

are busy people with substantial support staffs to assist them in

exercising many—if not all—of their de jure powers. While no one

would argue that these staffers are not agents of Congress, nor that they

are not as close as possible to exercising the de jure powers of a

congressperson when they draft or edit legislation, or provide summaries

and recommendations for voting purposes, their exercise of discretion in

these responsibilities engenders no nondelegation concerns. Why not?

A reasonable answer is that congressional staffers raise no concern

because they seem unlikely to have a great deal of legislative power. In

their close and continuous contact with the members of Congress they

serve, staffers could technically substitute language in a bill or

misinform a member of Congress in a way that influences the exercise

of the their de jure powers. But that wouldn’t happen: the member of

Congress would soon discover the act, and the expected response would

obviate the benefit of undertaking such an act in the first place. The

same reasoning applies to a delegation of legislative power to a closely

controlled agency. The more that Congress may be expected to retain

the ultimate power of legislative outcomes, the less it matters whether

Congress or another entity undertakes the formalistic step of enacting a

law.

2. Separation-of-Powers Theories

The two-prong theory of nondelegation also generalizes separation-

of-powers theories. Formalist separation-of-powers theories turn on the

strict definition of what it means to exercise legislative power, and thus

are subject to the same generalization described in the previous section.

Functional separation-of-powers approaches are even more deeply

entwined with the proposal to add a distinct power inquiry.

A functional approach to the separation-of-powers principle

emphasizes checks and balances as protection against abuses of power,

and the corresponding nondelegation principle only limits undue

delegations of legislative power: those that would disrupt “the proper

1270 Virginia Law Review [Vol. 104:1229

balance between the coordinate branches [of government].”

158

It is

difficult to see how the proper balance could be assessed without an

inquiry into the distribution of legislative power in a proposed

delegation scheme. The generalization here is really more of an

operationalization of the core concept. A delegation of lawmaking

responsibility is void as disrupting the proper balance when it conveys

too much power over lawmaking outcomes to an agency. By the same

stroke, an expansive delegation of lawmaking discretion is not void as

disrupting the proper balance when it is made in a manner suggesting

that Congress would retain sufficient power over the actual lawmaking

outcomes, such that the balance of power has not substantially shifted by

the act of delegation.

159

3. Common Law Agency Theories

This two-prong approach also generalizes the agency-law theory of

nondelegation. Both approaches are premised on taking seriously the

agency relationship underlying a delegation of legislative powers. The

two-prong approach simply adds structure to the question whether

Congress—the agent of the public—has enough legislative power in the

relationship to make the lawmaking acts of the agency—the subagent—

essentially ministerial in nature.

160

Congress could, as elsewhere, effect

this result by legislating specifically or by legislating broadly but in a

158

Nixon v. Adm’r of Gen. Servs., 433 U.S. 425, 443 (1977); see also Mistretta v. United

States, 488 U.S. 361, 380–84 (1989) (applying Nixon’s general separation-of-powers

concept in the specific case of a nondelegation challenge).

159

A latent ambiguity in this separation-of-powers theory of nondelegation is whether it

contemplates a definition of what it means for power to be legislative, independent of the

power to make laws. One possibility is that only important acts of lawmaking are legislative

in this scheme. Cf. Lawson, supra note 63, at 1239 (suggesting that “Congress must make

whatever policy decisions are sufficiently important to the statutory scheme at issue so that

Congress must make them”). Another possibility is that all lawmaking is deemed to be

legislative, so that the whole of the constitutional inquiry would collapse to the power

inquiry. Cf. United States v. Grimaud, 220 U.S. 506, 517 (1911) (“[I]t is difficult to define

the line which separates legislative power to make laws, from administrative authority to

make regulations.”).

160

See, e.g., Restatement (First) of Agency § 78 (1933) (“Unless otherwise agreed,

authority to conduct a transaction does not include authority to delegate to another the

performance of acts incidental thereto which involve discretion or the agent’s special skill;

such authority, however, includes authority to delegate to a subagent the performance of

incidental mechanical and ministerial acts.” (emphasis added)); see also Farina, supra note

10, at 91–93 (elaborating on this as it applies to an agency-law theory of the nondelegation

principle).

2018] Game Theory and the Nondelegation Principle 1271

way that adequately preserves its discretion as the guiding influence on

lawmaking.

161

To the extent that the underlying theory of nondelegation

is the unique fitness of the legislature to direct the policy choices behind

legislation,

162

the substantive inquiry is completely preserved in this

generalization: the interesting question is not whether Congress is

formally enacting laws on its own, but whether it is exercising sufficient

power over the lawmaking process and outcome.

A curious way in which the two-prong theory of nondelegation

exports part of the agency theory to other contexts is in the timing of the

power analysis. As Farina explains, the agency-law theory of

nondelegation allows for changes in an agent’s authority to delegate

lawmaking responsibility over time:

When a principal engages an agent to act [over an extended period of

time], the scope of actual authority cannot be static or the course of

external events might leave the agent unable to achieve the goals of

the principal. The general rule, therefore, is that authorization is

interpreted as of the time it is acted upon . . . .

163

As described in Part III, inquiry into the extent of an agency’s power

is heavily informed by context.

164

Like the law of agency approach, this

power inquiry cannot be conducted in the abstract, but must be

undertaken as of the time a delegation of lawmaking authority is acted

upon or challenged.

165

The two-prong theory of nondelegation thus

161

Variations on the law-of-agency theory expand or contract the importance of this

power consideration. See supra notes 87–89 (discussing versions of the agency-law theory of

different limiting potential).

162

See supra notes 80–81 and accompanying text (discussing this theory).

163

Farina, supra note 10, at 93 (citations and internal quotation marks omitted) (emphasis

added); see also Restatement (First) of Agency § 33 cmt. a (1933) (“[A] change of

circumstances may increase, diminish, or terminate [the agent’s] privilege to exercise a

power [on behalf of] the principal.”).

164

See Sections 0 and 0, discussing factors like the presence of information-forcing

procedures, the quality of public and private sources of monitoring information, and the

expected duration of a delegation relationship as time-varying factors that should be

expected to influence the distribution of legislative power. See also Keith Werhan, Principles

of Administrative Law 46 (2d ed. 2014) (“Congress [uses oversight to ensure] that agencies

exercise their authority and spend their money in a manner that is consistent with evolving

legislative policy goals.” (emphasis added)).

165

Cf. Lichter v. United States, 334 U.S. 742, 783 (1948) (using evidence that Congress

was aware of specific agency practices and did not seek to modify them when revising the

empowering statute to reason that these practices reflected “current correct understanding of

the congressional intent” which, along with other practices, “substantially incorporated” into

1272 Virginia Law Review [Vol. 104:1229

agrees with the timing of the law of agency approach, and does so

regardless of the theory of nondelegation supplying the definition of

legislative power in the first prong of the theory.

4. Functional Governance Theories

As discussed in Subsection II.B.4, the staggering variety of normative

and functional arguments for and against delegations of legislative

powers complicates explanation of how a discrete power inquiry would

generalize this entire field. In some cases, it concededly would not. If

the normative basis for a nondelegation principle is the insistence that

avoidance of legislative drafting and the hurdles of bicameralism and

presentment allows for too much lawmaking,

166

for example, then the

relative legislative power of the empowered agency is simply not

relevant to the inquiry. In other cases, however, the extent of an

agency’s power to legislate is intimately related to the underlying

normative concern.

Take the commonly advanced theory that delegations of legislative

power should be curtailed because they allow Congress to escape public

accountability for the laws that are enacted by an empowered agency.

167

Oversimplified, the normative argument is that voters may not hold

Congress responsible for the laws enacted by the agencies it has imbued

with legislative authority. This might, perhaps, be true if Congress has

delegated legislative power to the agency,

168

but Congress’s

accountability for agency lawmaking is at its zenith when Congress

retains substantial legislative power in the relationship. First, to the

extent that congressional preferences are substantively directing agency

lawmaking, it is hard to see why voters would not hold Congress

accountable for the actions of the agency. Second, the very same factors

that will tend to give Congress the ability to maintain legislative power

in the delegation relationship give voters the leverage to hold it

later revisions of the statute, helped provide an intelligible principle to guide the agency’s

exercise of discretion (emphasis added)).

166

See supra notes 95–96 and accompanying text (discussing these types of concerns).

167

See, e.g., Schoenbrod, supra note 11, at 8–12 (arguing that enforcement of the

nondelegation principle increases legislative accountability).

168

For the sake of argument, I will note but set aside the question why Congress could not

be held accountable for the act of delegation itself. See Posner & Vermeule, supra note 66, at

1748 (“The problem with this argument is that Congress is accountable when it delegates

power—it is accountable for its decision to delegate power to the agency.”).

2018] Game Theory and the Nondelegation Principle 1273

accountable for the actions of an agency. If Congress has the legislative

power in the relationship, then its failure to exercise that power—

overriding agency lawmaking of which it has notice or continuing to

fund an agency after witnessing its lawmaking decisions, for example—

is plainly an act for which voters could and should hold it to account.

169

B. The Sliding-Scale Intelligible Principle Test

The motivating observation behind this two-prong theory of

nondelegation is that Congress does not necessarily need to legislate

specifically in order to retain substantial legislative power in a

delegation relationship. Under appropriate conditions, Congress can

continue to exercise legislative power, even when granting an agency

broad and textually unfettered lawmaking authority.

170

Constitutional

nondelegation analysis therefore needs to look beyond the text of an

empowering statute to the conditions that might facilitate or frustrate

Congress’s retention of legislative power on nontextual grounds. Social

circumstances, the presence of information-forcing procedures,

monitoring and oversight of agency actions, and the expected length and

flexibility of interactions between the agency and Congress are all

important factors to consider. When conditions suggest that Congress

could retain substantial legislative power even with uncircumscribed

delegations of authority, there is simply no need for textual specificity in

the empowering statute.

But what if conditions suggest that Congress would not retain much

(or any) legislative power if it did not legislate specifically? As the

credibility of Congress’s nontextual retention of legislative power fades,

the need for textual specificity rises. This is true for nearly every

definition of the legislative side of the legislative power inquiry

discussed in this Article. This is because—while none of the usual

theories of nondelegation are satisfied by the presence of a weak

intelligible principle in the empowering statute—all are satisfied by the

presence of a strong intelligible principle. Specific congressional

169

Cf. Lovell, supra note 99, at 90 (commenting that it is no easier to hold Congress

accountable for acts of general legislation than it is to hold it accountable for funding

lawmaking agencies); id. at 89–95 (criticizing other accountability arguments against the

delegation of legislative powers).

170

E.g., Davis, supra note 50, § 2.16, at 154 (“[T]he most effective . . . expressionof

legislative will may be delegation, with virtually no standards, but with strong legislative

influence upon policy creation after the delegation has been made.”).

1274 Virginia Law Review [Vol. 104:1229

legislation is consistent with the exercise of legislative power in a

textual theory, with the prototypical balance of constitutional powers in

a separation-of-powers theory, with the exercise of discretion by the

primary agent in an agency-law theory, and with the normative concerns

underlying many antidelegation theories in normative and functional

arguments theories.

The two-prong theory of the nondelegation principle thus suggests a

version of the intelligible principle test that places textual specificity on

a sliding scale. The need for textual specificity rises as surrounding

circumstances indicate that a delegation of broad authority would

otherwise give more and more legislative power to the agency; and the

need for textual specificity falls as surrounding circumstances indicate

that Congress could otherwise retain more and more legislative power

through agency incentivization and other nontextual avenues.

This sliding-scale version of the intelligible principle test has never

been expressly adopted—or even considered—by the Supreme Court.

But there is fair room for interpreting existing case law in terms of it.

Justice Brennan once griped that “candor compels recognition that our

cases regarding the delegation by Congress of lawmaking power do not

always say what they seem to mean.”

171

The Court has never claimed to

state precisely the demands of the intelligible principle test,

172

but where

the language of the intelligible principle test has seemed particularly out

of sync with its application, perhaps the reconciling principle is an

unconscious balancing of needs in light of implicit legislative power

inquiries. A systematic study of this hypothesis would require an entire

paper in itself, but two examples, based around the anomalies of

Panama Refining

173

and Schechter,

174

illustrate the potential explanatory

power of this sliding-scale test.

175

171

McGautha v. California, 402 U.S. 183, 273 (1971) (Brennan, J., dissenting).

172

See, e.g., Lichter v. United States, 334 U.S. 742, 779 (1948) (“The degree to which

Congress must specify its policies and standards in order that the administrative authority

granted may not be an unconstitutional delegation of its own legislative power is not capable

of precise definition.” (emphasis added)).

173

293 U.S. 388 (1935).

174

295 U.S. 495 (1935).

175

The point, here, is not to try to explain the outcome of these well-worn cases. Rather,

the point is to show the consistency of the proposed theory with a reasonable reading of

many cases, including Panama Refining and Schechter as important counterpoints. While far

too large an undertaking for the present Article, another strategy for assessing the proposed

theory of nondelegation would be to consider nondelegation cases in state courts, where the

2018] Game Theory and the Nondelegation Principle 1275

1. The Sliding-Scale Test over the Centuries

One observation in support of the hypothesis that the Court’s

nondelegation case law can be explained by implicit sliding-scale

analysis is that the model has adequate explanatory power over the

entire history of nondelegation case law. From the founding of the

country to modern times, a sliding-scale intelligible principle test

appears consistent with the case law, at least under a few stylized

assumptions.

To start at the beginning, no statute was invalidated on nondelegation

grounds for decades following the ratification of the Constitution. The

Framers themselves seem to have had little concern about delegations.

The topic was not discussed at all during the Constitutional Convention,

except in regard to a motion to give the President authority to execute

powers delegated by the legislature; the motion was defeated as

unnecessary.

176

This is not because federal agencies were not rapidly

formed and delegated substantial discretionary authority.

177

Nor is it

because delegations were not challenged for constitutionality.

178

These

early challenges predated the intelligible principle test,

179

but how much

would the specificity of congressional statement have mattered?

Comfort with the constitutionality of early delegations of authority

was arguably owed to the expectation that Congress would retain

substantial legislative power in these arrangements. Most early

delegations involved an authorization of substantively, economically,

principle may have more bite. See Edward H. Stiglitz, The Limits of Judicial Control and the

Nondelegation Doctrine, 34 J.L. Econ. & Org. 27, 30–32 (2018) (discussing and collecting

sources on state-law applications of the nondelegation principle).

176

Davis, supra note 50, § 2.02, at 79 (“Delegation was not discussed at the Constitutional

Convention, except that a motion by Madison that the President be given power ‘to execute

such other powers . . . as may from time to time be delegated by the national Legislature’

was defeated as unnecessary.” (quoting 1 The Records of the Federal Convention of 1787, at

67 (Max Farrand ed., 1911))); see Freedman, supra note 7, at 308 (“The Constitution does

not speak to [legislative delegation] explicitly, perhaps because the Framers did not consider

the question a serious one.”).

177

See Davis, supra note 50, § 2.02, at 79 n.14 (commenting that “[d]elegation by

legislatures before 1787 was common”); Posner & Vermeule, supra note 66, at 1735–36

(listing early delegations of ostensibly legislative power); Davis, supra note 7, at 719–20

(describing the delegations of discretionary authority made by the First Congress).

178

E.g., Field v. Clark, 143 U.S. 649 (1892); Wayman v. Southard, 23 U.S. 1 (1825);

Cargo of the Brig Aurora v. United States, 11 U.S. 382 (1813).

179

Cf. J. W. Hampton, Jr., & Co. v. United States, 276 U.S. 394, 409 (1928) (providing

the first clear statement of the current intelligible principle test).

1276 Virginia Law Review [Vol. 104:1229

and logistically narrow scope.

180

And with a limited government

discharging duties of everyday comprehension, the exercise of the

delegated discretion may have been relatively easy to monitor.

181

Peter

Strauss suggests as much in a summary of the eighteenth-century model

of government:

The minimalist federal government outlined in Philadelphia in 1787

envisioned a handful of cabinet departments to conduct the scanty

business of government . . . . The eighteenth-century model relied

heavily on the controls of politics over and among the branches of

government to keep it within reach of the people, to subdue the risks

of tyranny.

182

If this early era of government did permit Congress to retain

nontextual legislative power in its delegations of authority, when did

circumstances start to change? The first hints of contemporary federal

agencies did not appear until 1848, with the creation of the Department

of the Interior,

183

or more plausibly 1887, with the creation of the

Interstate Commerce Commission.

184

A few decades later, the Court

handed down Panama Refining and Schechter.

185

It is noteworthy that the high-water line of the intelligible principle

test’s demand for textual specificity occurred amidst a confluence of

challenges to Congress’s ability to retain legislative power through

nontextual channels. Panama Refining and Schechter arose in the midst

of (and as part of) an unprecedented expansion of the federal

government. These were emergency measures

186

that conveyed

180

See, e.g., Barry D. Karl, Executive Reorganization and Presidential Power, 1977 Sup.

Ct. Rev. 1, 12 (“Of the earlier departments—State, Treasure, War, the Attorney General’s,

and the Post Office—only the last had significant patronage to distribute.”).

181

Id. at 11 (“Although much can be said about the colonial experience with monarchy,

royal governors, and the like, the conditions of national life at the beginning and through

much of the nineteenth century simply did not raise the issues of management on the

dynamic and shifting scale that followed the Civil War.”).

182

Strauss, supra note 155, at 582 (citations omitted).

183

See Karl, supra note 180, at 12.

184

Act of Feb. 4, 1887, ch. 104, § 11, 24 Stat. 379, 383 (creating the Interstate Commerce

Commission).

185

Panama Refining, 293 U.S. 388; Schechter, 295 U.S. 495.

186

Act of June 16, 1933, ch. 90, § 1, 48 Stat. 195, 195 (explaining in the declaration of

policy that the NIRA provisions were intended to address “[a] national emergency

productive of widespread unemployment and disorganization of industry” (emphasis

added)).

2018] Game Theory and the Nondelegation Principle 1277

rulemaking authority on a short-term basis (for which Congress could

not have relied upon long-term relational incentivization),

187

in part, to

private individuals (over which Congress would have even less

relational control).

188

The monitoring and reactionary capacities of

Congress would have been strained by domestic problems (the Great

Depression) and rising international tensions (World War II).

189

Schechter added to these challenges the most sweeping delegation of

rulemaking authority ever tested by the Court.

190

If ever there were a

time that the Court might have perceived Congress as needing textual

specificity to retain legislative power, this was it.

The Court’s demand for textual specificity waned after Panama

Refining and Schechter. And obviously the modern federal government

consists of many large lawmaking agencies,

191

often empowered to act

without any serious intelligible principle to guide the exercise of their

lawmaking powers.

192

But just as the Court’s demand for textual

specificity has changed, so too has the context of Congress’s

delegations. As already noted, in 1935 the Federal Register Act was

passed, in part to provide basic oversight on the growing body of agency

lawmaking;

193

in 1946 Congress passed the Administrative Procedure

Act;

194

later came yet stronger information-forcing controls on agenc-

ies.

195

This is not to say that the subjugation of agency autonomy has

been uniform: judicial control over agency discretion has been

187

A sunset provision would terminate Title I of the Act (authorizing the setting of codes

of fair competition) at the earlier of two years, or the conclusion by either Congress or the

President that the emergency had ended. Id. § 2(c), 48 Stat. at 196.

188

See, e.g., United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 171–74 (1940)

(illustrating the participation of private parties in the standard setting of an industry’s “code

of fair competition” under the NIRA).

189

See the first paragraph of this Article for context.

190

Davis, supra note 50, § 2.06, at 100 (“The Schechter case involved the most sweeping

congressional delegation of all time.”).

191

Cf. Strauss, supra note 155, at 581–96 (discussing the profusion of governmental

forms and inter-organizational relationships that comprise the modern administrative

government).

192

See supra notes 47–51 (discussing the weak standards that have been found to satisfy

the intelligible principle test).

193

44 U.S.C. § 1501 et seq. (2012).

194

5 U.S.C. § 551 et seq. (2012).

195

Contract with America Advancement Act of 1996, Pub. L. No. 104–121, 110 Stat. 847

(1996) (providing for the enactment of the Small Business Growth and Fairness Act of

1996).

1278 Virginia Law Review [Vol. 104:1229

substantially limited in recent decades,

196

as have some measures of

congressional control.

197

But as described in Sections III.C and III.D of

this Article, Congress now has many tools for monitoring agency

lawmaking, and for incentivizing agencies in ways that may allow it to

retain substantial legislative power without textual specificity in an

empowering statute. While there is certainly room to debate exactly how

much legislative power a given delegation might transfer to an agency,

the modern context is one in which a court might reasonably conclude

that great textual specificity is not needed for Congress to retain

substantial legislative power. Such a court would be low on the sliding-

scale demand for textual specificity.

2. Reconciling Schechter and Yakus

To the extent that this high-level overview shows plausible

consistency between case law and the sliding-scale version of the

intelligible principle test, one might wonder if the sliding-scale test can

explain lower level differences in cases as well. Again, the argument is

superficial, but at least a suggestion that the sliding-scale hypothesis

may explain the Court’s implicit reasoning in individual cases can be

gleaned from a comparison of the very different outcomes in two

otherwise seemingly similar cases: Schechter and Yakus v. United

States.

198

As discussed several times now, Schechter arose amidst a perfect

storm of challenges for the retention of legislative power through

nontextual channels: the case involved an emergency act that granted

short-term authority, in part to private individuals with limited

dependence on Congress, and empowered these individuals to regulate

commerce at large through the promulgation of codes of fair

196

E.g., Chevron U.S.A. Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984)

(describing what has come to be known as “Chevron deference,” often requiring courts to

defer to an agency’s own interpretation of its empowering statutes); Vt. Yankee Nuclear

Power Corp. v. Nat. Res. Def. Council, Inc., 435 U.S. 519 (1978) (generally prohibiting

reviewing courts from imposing procedures on agencies that eclipse the procedures imposed

by Congress).

197

E.g., Bowsher v. Synar, 478 U.S. 714 (1986) (prohibiting Congress from exercising

direct control over the execution of a statute); Process Gas Consumers Grp. v. Consumer

Energy Council of Am., 463 U.S. 1216 (1983) (affirming extension of the principle in

Chadha to a two-house legislative veto); I.N.S. v. Chadha, 462 U.S. 919 (1983) (invalidating

the general form of the legislative veto over agency action).

198

321 U.S. 414 (1944).

2018] Game Theory and the Nondelegation Principle 1279

competition.

199

Finding this statutory standard—“fair competition”—too

vague for the extent of the delegation at issue, the Court held Section 3

of the NIRA to be an unconstitutional delegation of legislative power.

200

But a mere decade later, the Court blessed a surprisingly similar act of

legislation in Yakus. Again, the case involved an emergency measure

(here, the Emergency Price Control Act of 1942).

201

Again, authority

was delegated on a short-term basis to an entity not expected to have a

long relationship with Congress (here, the Office of Price

Administration, which was temporarily created to establish maximum

prices on commodities during World War II).

202

And again, the standard

set by Congress was vague at best: maximum prices were to be “fair and

equitable.”

203

Yet in Yakus, the Court found this limp standard to meet

the intelligible principle requirement: adequately marking the

boundaries of the delegated authority.

204

What had changed?

The textual specificity of “fair and equitable” is hardly better than

“fair competition.” And while the Emergency Price Control Act did

contain some additional detail—instructions that the agency give “due

consideration” to a variety of economic factors—the detail was merely

suggestive.

205

But Congress had, by this time, about a decade of

experience working with the recently expanded bureaucracy. It had long

ago passed the Federal Register Act, and was well along in the process

of negotiating the Administrative Procedure Act.

206

The delegation was

made to “a public official responsible to Congress or the

199

See supra notes 1–4, 185–190 and accompanying text (discussing Panama Refining

and Schechter).

200

Schechter, 295 U.S. at 541–42 (“In view of the scope of that broad declaration, and of

the nature of the few restrictions that are imposed, [discretion to enact] laws for the

government of trade . . . is virtually unfettered. We think that the code-making authority thus

conferred is an unconstitutional delegation of legislative power.”).

201

Emergency Price Control Act of 1942, 50 U.S.C. app. § 901 (2012).

202

Yakus, 321 U.S. at 419–20 (describing the substance of the Act, which was “adopted

as a temporary wartime measure,” with explicit provision “for its termination on June 30,

1943, unless sooner terminated by Presidential proclamation or concurrent resolution of

Congress”).

203

Id. at 422.

204

Id. at 423 (concluding that the “boundaries of the field of the Administrator’s

permissible action are marked by the statute”).

205

Id. at 421 (“So far as practicable . . . the Administrator shall ascertain and give due

consideration to the prices prevailing between October 1 and October 15, 1941 . . . and shall

make adjustments for such relevant factors as he may determine and deem to be of general

applicability, including [a list of examples].”).

206

See supra notes 129–130 and accompanying text (discussing these Acts).

1280 Virginia Law Review [Vol. 104:1229

Executive . . . [not to] private individuals engaged in the industries to be

regulated.”

207

And while the delegated authority was hardly minimal,

maximum price schedules may have seemed more amenable to

congressional monitoring than codes of competition at large. The

implication of all this is that nontextual retention of legislative power by

Congress may have seemed more plausible to the Court in Yakus than it

did in Schechter.

208

That implication can be made close to explicit. In concluding that the

textual specificity of the empowering act in Yakus satisfied the

intelligible principle test, the Court specifically considered

congressional oversight of the actions of the empowered agency:

The standards prescribed by the present Act, with the aid of the

‘statement of considerations’ required to be made by the Adminis-

trator, are sufficiently definite and precise to enable Congress, the

courts and the public to ascertain whether the Administrator, in fixing

the designated prices, has conformed to those standards.

209

It is hard to imagine why a court should care whether Congress would

be able to ascertain conformance with its own will, unless of course the

implicit concern is with congressional retention of legislative power, in

which case the ability of Congress, courts, and the public to monitor

agency lawmaking becomes highly relevant. Other cases of the era were

similarly explicit in their concern about congressional oversight of

agency action.

210

If modern cases are less apt to emphasize this concern,

207

Yakus, 321 U.S. at 424 (emphasis added).

208

Cf. Schechter, 295 U.S. at 532–34 (contrasting Section 3 of the NIRA with the Federal

Trade Commission Act, which provided administrative procedures for defining “unfair

methods of competition” subject to formal complaint, notice, hearing, and findings of fact,

and noting that “[i]n providing for codes [of fair competition], the [NIRA] dispenses with

this administrative procedure and with any administrative procedure of an analogous

character”).

209

Yakus, 321 U.S. at 426 (emphases added).

210

See Hirabayashi v. United States, 320 U.S. 81, 104 (1943) (“Where, as in the present

case, the standard set up for the guidance of the military commander, and the action taken

and the reasons for it, are in fact recorded in the military orders, so that Congress, the courts

and the public are assured that the orders, in the judgment of the commander, conform to the

standards approved by the President and Congress, there is no failure in the performance of

the legislative function.” (emphasis added)); Opp Cotton Mills v. Adm’r of Wage & Hour

Div., Dep’t of Labor, 312 U.S. 126, 144 (1941) (“[W]here, as in the present case, the

standards set up for the guidance of the administrative agency, the procedure which it is

directed to follow and the record of its action which is required by the statute to be kept or

which is in fact preserved, are such that Congress, the courts and the public can ascertain

2018] Game Theory and the Nondelegation Principle 1281

perhaps they are simply internalizing the procedural and social

frameworks that now surround most agencies and are acting on the

implicit assumption that Congress can monitor and respond to agency

lawmaking. If so, they simply fail to say what they seem to mean.

211

V. CONCLUSION

Of all constitutional puzzles, the nondelegation principle has long

been one of the most perplexing. The Court’s ringing language about the

importance of the principle stands in stark contrast to centuries of lax

enforcement. And while many constitutional theories argue in favor of

meaningful nondelegation principles, they share some odd properties in

common. Existing theories are generally unable to reconcile faithful

adherence to a meaningful nondelegation principle with the possibility

of broad, textually unencumbered delegations of lawmaking power.

Either these theories require adjustment, or the fundamental structure of

government needs to change. They also cannot reconcile the objectives

of nondelegation with the Court’s intelligible principle test. Again,

either these theories or legal practice needs to change.

The thesis of this Article is that much can be explained by

recognizing that nondelegation analysis is not a one-prong inquiry, but

actually a two-prong inquiry in every case. Beyond the usual question of

characterizing the lawmaking authority being granted, nondelegation

analysis demands inquiry into the extent of legislative power that an

agency will command. Building this power inquiry into the analysis, this

Article shows that faithful adherence to meaningful nondelegation

principles can be reconciled with textually unfettered delegations of

expansive authority—which do not offend the principle if Congress is

still retaining substantial legislative power through nontextual channels

of the delegation relationship. The Article also shows how this power

inquiry motivates a sliding-scale version of the intelligible principle test.

The sliding-scale test demands less textual specificity of Congress as the

credibility of Congress’s non-textual exercise of legislative power

grows.

whether the agency has conformed to the standards which Congress has prescribed, there is

no failure of performance of the legislative function.” (emphasis added)).

211

Cf. supra note 171 and accompanying text (noting Justice Brennan’s comment in

McGautha v. California that nondelegation cases “do not always say what they seem to

mean”).

1282 Virginia Law Review [Vol. 104:1229

To address a potential criticism, and to emphasize an important point,

nothing in this argument should be taken as a claim that Congress does

retain substantial legislative power in every act of delegation. The point

is that the distribution of legislative power is a priori uncertain and can

only be answered by considering the nature of the delegation and the

conditions under which it is made. This is an open-ended inquiry, but

concrete factors to consider are suggested in Sections III.B, III.C, and

IV.B. These include the availability and practice of congressional

monitoring, the existence of information-forcing procedural

frameworks, public access to the agency lawmaking process, and the

availability of relational tools for congressional incentivization of

agency behavior.

Nothing in this argument claims to resolve every challenge in the

implementation of this two-prong nondelegation theory. Assessing an

agency’s legislative power is a difficult task—though probably no more

difficult than trying to say what separates legislative and nonlegislative

acts of lawmaking. And the timing of the power inquiry is likewise

complicated in that deciding whether Congress will be able to exercise

continuing legislative power is both a difficult question and one for

which the answer may change over time. This raises challenging

questions about the judicial manageability of the undertaking. But the

difficulty of these problems is a poor excuse for not at least attempting

to address them. And these difficulties, though real, are hardly greater

than the equally daunting fact questions that courts face in general

separation-of-powers cases,

212

in statutory interpretation cases,

213

or in

any case turning on the prediction of future events from conflicting

evidence. We rise to the challenge elsewhere in law; we can do so here.

212

See, e.g., The Federalist No. 37, at 231 (James Madison) (The Belknap Press of

Harvard University Press 2009) (“Experience has instructed us that no skill in the science of

government has yet been able to discriminate and define, with sufficient certainty, its three

great provinces—the legislative, executive, and judiciary; or even the privileges and powers

of the different legislative branches. Questions daily occur in the course of practice, which

prove the obscurity which reigns in these subjects, and which puzzle the greatest adepts in

political science.”).

213

See, e.g., Karl N. Llewellyn, Remarks on the Theory of Appellate Decision and the

Rules or Canons About How Statutes Are to Be Construed, 3 Vand. L. Rev. 395, 401–06

(1950) (noting the basic indeterminacy of most canons of textual construction).

Powers, But How Much Power? Game Theory and the Nondelegation Principle

Abstract