Paul Nolette comes to Liberty Law Talk to discuss his book Federalism on Trial, which demonstrates how state attorneys general quietly became significant national policymakers. What was once a rather staid position in state government has become the source of entirely new regimes of conduct impressed on companies and industries. Incredible evidence of this legal revolution can be seen in the Master Settlement Agreement with the tobacco industry, which, courtesy of the attorneys general, sent $200 billion to the states and negotiated an entirely new cartel for the industry without a single vote in Congress.
While some attorneys general have challenged key pieces of the Obama administration’s regulatory agenda, mostly what has occurred the past few decades is a bipartisan pro-regulatory agenda. In short, Nolette’s work indicates that we have been governed by a band of roving bandits who “bargain in the shadow of the law.” Under threat of investigations, lawsuits, and legal fees, companies and entire industries have accepted regulatory codes that, in many cases, were rejected by legislatures or not implemented by agencies. Not to worry, we discuss how State AGs pick up the slack, as it were, and make law in the gaps of accountability. That’s power, but it’s rule over and above the law.
We have Paul to thank for helping us get perspective on this disordered regulatory situation.