Commentators have argued that, even if the president has the unilateral authority to terminate Article II treaties concluded with the Senate’s advice and consent, the president lacks the unilateral authority to terminate “congressional-executive agreements” concluded with majority congressional approval, such as the North American Free Trade Agreement (NAFTA). This Article challenges that claim. If one accepts a presidential authority to terminate Article II treaties, this Article contends, there is no persuasive reason to conclude differently with respect to congressional-executive agreements. Congressional-executive agreements have become largely interchangeable with Article II treaties as a matter of domestic law and practice. For example, either instrument can be used to address matters relating to international commerce and trade. Moreover, while presidents cannot unilaterally terminate statutes, congressional-executive agreements are not mere statutes. They are, like Article II treaties, binding international instruments that can be concluded by the United States only through presidential action. These agreements also typically contain withdrawal clauses similar to those contained in Article II treaties, which presidents have long invoked unilaterally, and Congress has never indicated that presidents have less withdrawal authority for such agreements. Indeed, in its trade legislation, Congress appears to have accepted that presidents may invoke such clauses unilaterally.
The regulator that designs and first implements a federal regulatory program does not always have the ability to control the timing and process of how that regulatory program will, in this Symposium’s language, “exit.” As the 2016 election has demonstrated, the initiating regulator cannot necessarily plan in advance for the program’s expiration, diminution, or scaling back. A successor instead wields this power. Whether one views this as a terrible thing or a salutary feature of democracy depends in part upon one’s relationship to the regulatory status quo, but also implicates broader questions about policy stability and democratic accountability. At the very least, however, this fact raises several important questions about strategic regulatory design. First, is it possible to insulate or harden regulatory programs from successor exit? And second, when, if ever, would this be a good thing? This Article offers a systematic account of how regulators can make regulatory exit more challenging by looking outward, beyond the walls of a single, primary federal agency to other potential regulators or co-regulators, including secondary federal agencies, the states, and private actors.
This Article identifies as a potential antidote to regulatory exit a constellation of strategic techniques that I call regulatory horcruxes—much like the horcruxes Lord Voldemort created by placing portions of his soul into multiple external objects in order to ensure his immortality. An initiating regulator, be it Congress or a federal agency, can use such horcruxes in an effort to make successor exit more difficult by splitting programs beyond the walls of a single federal agency into other institutions. This Article first offers an analytical framework laying out five primary types of horcrux. It then examines horcruxes from a normative perspective, evaluating the comparative benefits and costs of their use in terms of their potential impact both on the durability of regulatory programs and on the quality of democratic deliberation. It acknowledges that horcruxes are an imperfect solution. Although dispersal or fragmentation of regulatory authority may insulate a program from deregulatory pressure, the fragmented regulatory program may exist in a weakened form that cannot accomplish as much as more direct, centralized regulation can. The Article concludes by offering a research agenda, including suggestions for further empirical research.
In recent years, the federal government’s efforts to open up competitive electricity markets have transformed how we think about the regulation of energy. In many respects, the Federal Energy Regulatory Commission’s (FERC) broad “deregulatory” efforts, which commenced in the 1990s, might appear to be a case of paradigmatic regulatory exit as defined by J.B. Ruhl and Jim Salzman. But our case study of FERC’s restructuring of wholesale electricity markets reveals some important institutional features that make exit in federalism contexts, and under federal statutory duties, a rich and difficult problem. In the context of energy, exit from one regulatory sphere can create regulatory gaps. This has led FERC, which largely exited the regulation of wholesale electricity rates, to increase regulation in other spheres. It has also invited forms of intergovernmental exchange, as states have emulated or otherwise responded to FERC’s regulatory modifications in the areas in which states have jurisdiction. In this sense, the transition to competitive energy supply markets has involved constrained exit characterized by a hydraulic back-and-forth between regulators and institutions in an effort to ensure that statutory duties are fulfilled and other public needs are met.
This assessment of regulatory exchange has a prescriptive implication: a federal regulator seeking to exit specific forms of conventional regulation needs to proactively develop strategies to facilitate regulatory exchange, while simultaneously preserving its authority over important substantive values related to its regulatory mission. Attention to “offsetting” regulations is often necessary to ensure that problematic regulatory gaps will not arise. In the energy context, these strategies might also include the use of mechanisms that give other institutions a voice in implementing exit strategies, as well as better ex ante regulatory planning for market enforcement that will continue after partial exit. We argue that it is not only a good strategy for federal regulators to recognize this hydraulic feature of exit, but that cooperative federalism statutes such as the Federal Power Act often require them to do so.