Now showing items 21-40 of 18188

    • The SPAC Trap: How SPACs Disable Indirect Investor Protection

      Spamann, Holger; Guo, Hao (2021)
      Indirect investor protection makes investing in most public securities safe even without understanding their terms or the underlying business. Special Purpose Acquisition Companies (SPACs) disable this protection by offering two alternative payoffs from the same security, the SPAC share, in the de-SPAC process: the redemption value, or a share in the post-de-SPAC entity. The former is usually higher and chosen by sophisticated repeat players, while unsophisticated investors elect the latter or receive it by default. Before the de-SPAC process, the SPAC share price reflects the higher payoff, such that unsophisticated investors systematically overpay. This overpayment is captured, directly or indirectly, by SPAC sponsors and IPO investors. This allows the latter to make money from SPACs even if SPACs create negative social value.
    • The Oversight Board’s Dormant Power to Review Facebook’s Algorithms

      Pickup, Edward L. (2021)
      This Essay argues that Facebook’s Oversight Board—an independent “Supreme Court” for Facebook, tasked with reviewing the platform’s content-moderation decisions—has the additional power to review Face-book’s algorithms. While much of the literature on the Board assumes that it does not have this power, the text and structure of the Board’s Charter clearly provide for oversight of algorithms. This is an important observation because many of the serious problems plaguing online speech today—misinformation, radicalization, and community safety—are driven by algorithmic amplification. Equipped with the powers this Essay identifies, the Board could play a significant role in curbing the pernicious effects of algorithmic amplification of speech on Facebook.
    • Time Enough for Counting: A Unicorn Retrospective

      Cable, Abraham J.B. (2021)
      Legal scholars worry that existing laws cannot adequately regulate large private companies (“unicorns”). At the same time, unicorns seem to be a key part of flourishing markets. Are unicorns a problem that requires solving or a sign that entrepreneurial finance is working? This essay addresses that question by tracking outcomes for the 32 startups that qualified as unicorns when the moniker first emerged. It introduces a new typology of unicorn outcomes to guide policy makers and offers a preliminary hypothesis that private ordering by founders, employees, and investors is proving an effective alternative to ambitious regulatory reform.
    • Work and Employment for DACA Recipients

      Heeren, Geoffrey (2021)
      Deferred Action for Childhood Arrivals (DACA) has brought job opportunities and a brighter future to somewhere around 700,000 undocumented immigrant youth. Yet some contend that the employment authorization conferred upon DACA recipients renders the program illegal, because it converts it from a mere program of prosecutorial discretion into an ultra vires benefit. This essay sets aside the host of other legal issues raised by DACA and focuses on the narrow question of whether the federal government exceeds its statutory authority when it confers employment authorization on DACA recipients. There is a short answer to this question that is based on the unambiguous text of the Immigration and Nationality Act (INA), which is an emphatic no. The relevant statute defines an “unauthorized alien” for employment purposes to exclude anyone designated as authorized for employment by the agency; the agency has long designated deferred action as a category authorized for employment, and DACA is a species of deferred action. Yet some courts have found this answer unsatisfying, referring to the provision as a “mousehole” that pales beside the vast social and economic questions at stake in making large numbers of undocumented immigrants eligible for employment. Federal courts in Texas have enjoined DACA and a related program called Deferred Action for Parental Accountability (DAPA) based on their inference that a purpose of the INA is to parsimoniously guard employment authorization as part of a broader scheme to enforce immigration law and protect jobs for native workers.
    • Embedded Rules

      Stephenson, Matthew C. (2021)
      Rules are rules and orders are orders, and never the twain shall meet. Generations of scholars and practitioners were taught back in law school that the Administrative Procedure Act (APA) divides the universe of agency action into two exclusive and exhaustive categories: “rulemaking,” which is used for promulgating “rules,” and “adjudication,” which is used for issuing “orders.” Each of those modes of agency action has its formal and informal versions, and some statutes mandate “hybrid” procedures with an intermediate level of formality. But the starting point for analyzing a given agency action is to decide whether that action falls into the “rule” box or the “order” box, which are separate and distinct. That is what then-Professor, now-Justice Elena Kagan taught me back when I took her Administrative Law class as a 2L, and it’s what I’ve taught my students for the last fifteen years. But it’s not quite right. “Rules” and “orders” are not, in fact, completely separate and non-overlapping categories. Sometimes an administrative action that is properly classified as an order contains within it—usually in the portion explaining the order’s legal basis—a statement that qualifies as a rule and ought to be treated as such. The fact that such a rule is embedded within an order does not make it any less of a rule. And that means that the process for formulating an embedded rule counts (or ought to count) as a “rulemaking” under the APA.
    • Fair Pay and Safe Workplaces in Government Contracting: Reassessing Labor Law Benefits in Light of Infrastructure Investments and Buy American

      Klingler, Désirée U. (2021)
      When purchasing infrastructure, goods or services, the U.S. government has “to promote economy, efficiency and effectiveness.” Executive Order No. 13,673, issued by President Obama, expanded the requirement to encompass social sustainability: to promote economy and efficiency in procurement, the government was required to “contract with responsible sources who comply with labor laws.” The Fair Pay and Safe Workplaces rule (the Rule), proposed in 2014, required contractors of federal agencies to provide fair wages and safe workplaces to their workers. Because industries feared that the Rule would lead to contractors being unfairly excluded from public contracts, opponents of the Rule called it the “blacklisting rule.” After having reviewed the final rule and its regulatory impact analysis, the Office of Management and Budget (OMB) approved the Rule in 2016. Shortly after his inauguration, President Trump revoked the Rule. Now, with Congress’ passage of the “once-in-a-generation” Infrastructure Investment and Jobs Act, and the proposed Buy American rule, the U.S. government will employ thousands of American workers to build highways, bridges, and public transit.10 Hence, improving the quality of workplaces in government purchasing is more relevant than ever and may very well necessitate the promulgation of a new version of the Rule. Therefore, taking a closer look at the Rule’s regulatory impact assessment and evaluation of labor law benefits is warranted and can provide a helpful model for understanding and improving cost-benefit analysis of government purchasing.
    • “Professional” Employers and the Transformation of Workplace Benefits

      Shnitser, Natalya
      Workers in the United States depend on their employers for a host of benefits beyond wages and salary. From retirement benefits to health insurance, from student loan repayment to dependent-care spending plans, from disability benefits to family and medical leave, U.S. employers play a uniquely central role in the financial lives of their employees. Yet not all employers are equally willing or capable of serving as such financial intermediaries. Larger employers commonly offer more and better benefits than smaller employers. In recent years, so-called Professional Employer Organizations (PEOs) have pitched themselves as a private-sector solution to the challenges traditionally faced by smaller employers. PEOs have pioneered and marketed a “co-employment” model pursuant to which a business and the PEO agree to share certain employer rights and responsibilities, with the PEO taking on all of the human resources matters and the client-employer otherwise retaining control over the business. While PEOs respond to long-standing challenges faced by smaller employers and have the potential to increase access to workplace benefits, this Article argues that they also introduce new and significant governance concerns that are not adequately addressed by the existing regulatory framework. Empirical evidence suggests that as currently structured, PEOs may not, in fact, provide “Fortune 500” benefits to employees at smaller companies and may instead lock participating employers into costly benefit bundles and expose them to the risk of unpaid employment taxes and health insurance claims. To protect participants in arrangements where PEOs provide key workplace benefits, this Article recommends strengthening and uniformly applying registration, disclosure and oversight requirements for all non-employer intermediaries, including PEOs. In the longer term, comprehensive retirement reform is needed to account for the transformation of workplace benefits in the United States.
    • Climate Change Attribution Science and the Endangered Species Act

      Wentz, Jessica (2022)
      Climate change poses an enormous risk to plant and animal species across the planet. Mean global temperatures have already increased by approximately 1ºC, causing environmental changes that affect species abundance, distribution, behavior, physiology, genetics, and survival prospects. These changes, combined with other human stressors, have already resulted in the extinction of some species and imperiled many others. In the United States, the Endangered Species Act (ESA) is the primary legal vehicle for the protection and management of species at risk of extinction. The statute and accompanying regulations outline a science-based framework for identifying endangered and threatened species, establishing critical habitat boundaries, and mitigating the harmful impacts of public and private-sector activities on listed species. Although climate change is not explicitly mentioned in the statute, there is no question that agencies must consider climate-related threats when implementing the ESA. This Article examines the uniquely important role of climate change detection and attribution research in federal decision-making and judicial review under the ESA. This research provides insights on how climate change is already affecting species and habitats and is therefore integral to decisions about: (i) whether to list a species as threatened or endangered on the basis of climate-related threats, and (ii) how to support species recovery through critical habitat designations and other management actions. Courts have held that attribution research qualifies as the “best available science” that must be considered in ESA decision-making and that agencies cannot ignore attribution research on the basis of uncertainty or imprecision where the data suggests that there is a probable threat to a species. They have also consistently upheld the federal government’s use of attribution data to support ESA protections for climate-imperiled species.
    • Climate Change Cosmopolitanism

      Sunstein, Cass R. (2022)
      Do foreign lives matter? When? How much? If one nation damages another, what are its obligations, as a matter of law and policy? These questions can be approached and understood in diverse ways, but they are concretized in debates over the “social cost of carbon,” which is sometimes described as the linchpin of national climate policy. The social cost of carbon, meant to capture the damage done by a ton of carbon emissions, helps to determine the stringency of regulations in many domains, including emissions limits on motor vehicles and on stationary sources. In determining the social cost of carbon, agencies must decide whether to use the global number (as chosen by Presidents Barack Obama and Joe Biden) or instead the domestic number (as chosen by President Donald Trump). Use of the global number should be seen as a form of climate change cosmopolitanism, whether the grounding is moral, strategic, or otherwise. Within the constraints of governing statutes, there are four central arguments in favor of using the global figure. (1) The epistemic argument: experts do not know a great deal about the purely domestic harms from climate change, which makes it impossible to generate a purely domestic number. (2) The interconnectedness argument: harms done to U.S. citizens by domestic emissions are not limited to those directly brought about by the incremental increase in temperatures within the territorial boundaries of the United States; they include an assortment of harms to U.S. citizens living abroad and harms to U.S. citizens and interests that come as a result of the cascading effects of harm done to foreigners (including governments, companies, and individuals), which are ultimately felt by U.S. citizens or within the United States. (3) The moral cosmopolitan argument: in deciding on the scope of its regulations, the United States has a moral obligation to take account of the harms it does to non-Americans. (4) The reciprocity argument: if all nations used a domestic figure, all nations would lose; a successful approach to the climate problem requires nations to treat greenhouse gas emissions as a global, and not merely domestic, externality. Neither the epistemic argument nor the incompleteness argument justifies the choice of the global number.
    • Naïve Administrative Law: Complexity, Delegation and Climate Policy

      Spence, David B. (2022)
      The Supreme Court’s ongoing efforts to narrow the contours of administrative agencies’ policymaking discretion comes at a particularly inopportune time. The nation faces a set of increasingly complex and pressing national problems, including climate change, that require the simultaneous application of careful deliberation and expertise, something Congress is ill-suited to do in the best of times—but particularly so in this hyper-polarized era. Were the Court to fully embrace the Major Questions Doctrine, it would likely render environmental and energy regulators powerless to reduce greenhouse gas (GHG) emissions from the energy sector under their enabling statutes, despite the centrality of that task to their missions and plausible arguments that Congress has already delegated them that power. It would also call into question the legitimacy of many other existing regulatory regimes, throwing regulatory policy into chaos. The Doctrine draws a flawed distinction between policymaking and policy implementation based upon the economic and political significance of the decisions involved; if there is a useful distinction to be made between those two activities, it rests on the distinction between ends and means, the what questions and the how questions. The Framers’ design requires that Congress be able to delegate these difficult, complex, contentious “how” questions to the executive branch. Now more than ever, regulatory agencies—not Congress—can best produce decisions that reflect the “permanent and aggregate interests of the community.”
    • All the Tools in the Toolbox: A Plea for Flexibility and Open Minds in Assessing the Costs and Benefits of Climate Rules

      Sinden, Amy (2022)
      As the Biden Administration works on updating the social cost of carbon (SCC), some economists are urging a different approach, known as the “Marginal Abatement Cost” (MAC) method or the “target-consistent” approach. Rather than attempting to calculate all the damage caused worldwide by each ton of carbon dioxide released into the atmosphere, the MAC approach instead asks: what is the highest amount of money per ton that society will need to be willing to pay if we are going to successfully meet greenhouse gas reduction targets? This approach has the virtue of avoiding the most intractable complexities and uncertainties involved in estimating the SCC, including embedded ethical judgments about the degree to which the interests of future generations should be discounted in comparison to our own and the scope of the relevant “society” across which climate damages should be measured. Nonetheless, the MAC approach has come under fire from cost-benefit purists who argue, first, that it is inappropriate as a matter of good policymaking and, second, that it is prohibited by law. Both claims are at a minimum overstated and arguably outright wrong. As a matter of both legal mandate and good policy, the Biden Administration would do well to avoid the CBA orthodoxy that some commentators advocate. Instead, the Administration should as a matter of good policy—and can as a matter of law—make use of the rich variety of tools in the regulatory decision-making toolbox, including the MAC approach, in developing climate policy.
    • The Social Cost of Greenhouse Gases: Legal, Economic, and Institutional Perspective

      Revesz, Richard L.; Sarinsky, Max (2022)
      The social cost of greenhouse gases provides the best available method to quantify and monetize the climate damages attributable to the emission of an incremental unit of heat-trapping pollution. Accordingly, the metric can be highly useful for crafting policies that will reduce the nation’s greenhouse gas footprint, with potential usages including weighing the impacts of proposed fossil-fuel projects, assessing grant applications and procurement decisions that have climate impacts, and crafting fee schedules for monetary rates that will internalize the cost of climate damages onto polluters. To date, however, the use of the social cost of greenhouse gases for such determinations and processes has been sporadic and fairly limited. It is time for this practice to change, as broad application of the social cost of greenhouse gases will enable agencies and departments to identify programs or policies that cost-effectively reduce greenhouse gas emissions and thus enable a speedy and efficient transition to a greener economy. Because widespread use of the social cost of greenhouse gases would lend support to many decisions to transition away from fossil fuels, the methodology has become subject to criticism from opponents of climate reforms. While critics attempt to discredit the federal government’s social cost of greenhouse gases valuations—arguing that these values overestimate climate costs, disregard best practices, and even usurp the legislative function from Congress—such criticisms lack merit and should not deter agencies from broadly applying the social cost of greenhouse gases. This Article evaluates the various legal, economic, and institutional controversies surrounding the social cost of greenhouse gases and explains why this metric should play a critical role in guiding agency policymaking and decision-making related to climate change.
    • “The Grass is Not Always Greener” Revisited: Climate Change Regulation Amid Political Polarization

      Osofsky, Hari M.; Peel, Jacqueline (2022)
      In 2016, we co-authored a symposium article, The Grass is Not Always Greener: Congressional Dysfunction, Executive Action, and Climate Change in Comparative Perspective, 91 CHI.-KENT L. REV. 139 (2016), that compared the impact of polarization on the process of creating climate change law and policy in the United States and Australia. We found that while the United States relied heavily on administrative regulation because comprehensive climate change legislation could not pass Congress, Australia’s flip-flopping legislation did not offer a demonstrably superior solution. We did not at the time foresee the political changes that would take place in both countries over the five years that followed. The transitions from President Obama to President Trump to President Biden have involved dramatic shifts in regulatory policy at the same time as the same conservative Coalition government has until recently continued to hold power in Australia. This Article revisits our thesis, given these changes, that both forms of government face barriers to effective lawmaking when deep partisan divisions exist. We find that although the politics of particular periods may make one political system more stable in approach than the other, neither country has made consistent progress in addressing the problem of climate change. In addition, subnational governments and other key stakeholders have taken action in both countries when confronted with partisan barriers at the federal level. We conclude that the dramatic regulatory shifts in the United States and the limited regulatory action in Australia over the past five years only bolster the importance of advancing substantive and structural strategies that foster greater cooperation.
    • Delegating Climate Authorities

      Nevitt, Mark (2022)
      The science is clear: the United States and the world must take dramatic action to address climate change or face irreversible, catastrophic planetary harm. Within the U.S.—the world’s largest historic emitter of greenhouse gas emissions—this will require passing new legislation or turning to existing statutes and authorities to address the climate crisis. Doing so implicates existing and prospective delegations of legislative authority to a large swath of administrative agencies. Yet congressional climate decision-making delegations to any executive branch agency must not dismiss the newly resurgent nondelegation doctrine. Described by some scholars as the “most dangerous idea in American law,” the nondelegation doctrine prohibits Congress from delegating its legislative authority to the executive branch absent an intelligible principle to guide implementation. Failure to fully take into account possible nondelegation challenges could stop forward-looking climate action in its tracks. This Article addresses the contours of the nondelegation doctrine as applied to future climate action. In doing so, it argues that climate change and its associated impacts are a complex collective action problem that implicate Article II authorities independent of congressional lawmaking. These authorities may provide an avenue through which climate action can be taken irrespective of the limits imposed by the nondelegation doctrine. As prospective climate solutions emerge, the nondelegation doctrine lurks in the background. Climate action must therefore be reconciled with presidential foreign relations, national security, and emergency authorities—three areas where the President is afforded significant, but not absolute deference.
    • Regulatory Oscillation

      Masur, Jonathan S. (2022)
      In the wake of the Reagan deregulation, America experienced twenty-eight years of regulatory progression, with precious little retrogression. That trend came to a crashing halt during the four years of Donald Trump’s presidency. As a candidate, Trump campaigned on a series of pledges to reverse and undo as much of the work done by Barack Obama as possible. The Trump EPA was particularly active in this effort. In addition to reversing the Clean Power Plan, under Trump the EPA repealed or substantially weakened a number of other important Obama-era regulations, including a substantial increase in fuel economy standards and strict curbs on mercury and other emissions from coal-fired power plants. These regulations would have affected air quality and pollution more generally, but they also would have had a substantial effect on greenhouse gas emissions and thus on climate change. President Biden has promised to reinstate or even strengthen most if not all of the Obama-era regulatory initiatives that Trump eliminated. The EPA and other agencies are already at work on these new regulations. But Biden does not represent the end of history. Barring some seismic shift in political tectonics, some day in the future a Republican will again be elected president on a platform of ignoring climate change, protecting the fossil fuel industries, and reversing the regulatory progress of his or her Democratic predecessors. That president will likely undertake a program of deregulation, much as Trump did. Subsequently, a Democrat will again someday be elected president. That president will likely undertake a program of re-regulation, much has Biden has promised to do. From administration to administration, across terms, regulations will blink into and out of existence. They will become more and less stringent on four, eight, or twelve-year cycles. We are now living in an era of regulatory oscillation.
    • Climate Policy Buffers

      Lin, Albert C. (2022)
      The Trump administration wreaked havoc on U.S. climate policy by withdrawing from the Paris Agreement, undoing climate regulations, and undermining the foundation of future regulatory efforts. The Biden administration has begun to reverse the Trump administration’s climate rollbacks, but Democrats have struggled to enact legislation that would directly limit carbon emissions. Because federal climate policy remains rooted in agency rules and policies, the election of the next Republican president may herald further policy whiplash. Swings in climate policy waste limited government resources, foster uncertainty, weaken trust in federal climate policy, undermine climate mitigation efforts, and make future responses to climate change even more difficult. Understanding how to safeguard administrative climate policy from future rollbacks is essential. This Article contends that a suite of factors—including features of administrative law, subsidies for renewables, state climate policies and lawsuits, nongovernmental climate initiatives, incompetence, and happenstance—have all played important roles in buffering federal climate policy from more extensive damage. The Article then considers how to bolster these factors to protect federal climate policies from future efforts to undo them.
    • Evaluating Project Need for Natural Gas Pipelines in an Age of Climate Change: A Spotlight on FERC and the Courts

      Klass, Alexandra B. (2022)
      As the Biden administration attempts to make climate change the focus of many aspects of its domestic and international agenda, an independent federal regulatory agency—the Federal Energy Regulatory Commission (FERC)—finds itself at the center of debates over the nation’s energy policies and greenhouse gas (GHG) emissions. Under Sections 4 and 5 of the Natural Gas Act of 1938, FERC has the authority and obligation to ensure that rates, charges, and rules relating to interstate natural gas sales and transportation are just, reasonable, and nondiscriminatory. Under Section 7 of the Natural Gas Act, FERC also has the authority to grant certificates for construction and operation of interstate natural gas pipelines that are needed for the “present or future public convenience and necessity.” FERC’s longstanding practice under its 1999 “Policy Statement on Certification of New Natural Gas Facilities” for pipelines is to assess whether there is a “market need” for the proposed pipeline project before addressing other considerations such as adverse impacts on existing pipeline company customers, other pipelines in the market and their customers, and landowners and communities.
    • Valuing the Future: Legal and Economic Considerations for Updating Discount Rates

      Howard, Peter; Schwartz, Jason A. (2022)
      Discount rates reflect the commonly held belief that a dollar today is worth more than a dollar tomorrow. Therefore, consistent with observed human behavior, governments use discount rates to weigh and compare present versus future costs and benefits in their decisions. The choice of discount rates greatly impacts which government regulations are cost-benefit justified, particularly for regulations with long-term benefits, as in the context of climate change. Though the U.S. government has historically revised its recommended discount practices several times, the current recommendations for a 3% consumption rate and a 7% capital rate have been enshrined in federal guidance without revision since 2003, despite significant changes to society, markets, and the economics literature. This article details the compelling economic evidence and legal principles that support revising federal guidance on discounting. In the economics literature, multiple lines of evidence point to a central consumption rate below 2% as appropriate in government decisionmaking—and capitalbased rates as largely inappropriate for many policy contexts—particularly in rulemakings with inter-generational implications, like climate change. Legal principles support such revisions. Statutes and executive orders charge agencies to base decisions on the best available data and to consider future generations’ welfare. Though agencies must thoroughly explain their discounting choices, agencies have discretion to lower their discount rates consistent with updated evidence and ethical obligations. Agencies especially must justify any choices to apply different discount rates to different contexts or effects, but a declining discount rate framework can consistently harmonize agency practices and so put agencies on sound legal footing in their approach to valuing the future.
    • Costs, Confusion, and Climate Change

      Gundlach, Justin; Livermore, Michael A. (2022)
      In the United States, the primary tool to value greenhouse gas emissions reductions in cost-benefit analysis is the social cost of carbon (SCC), which is a metric that estimates, in monetary terms, the damages associated with climate change. Recently, some prominent public policy experts and scholars have proposed that a “marginal abatement cost” (MAC) could be used as an alternative to the SCC. Indeed, some jurisdictions, such as the United Kingdom, have integrated MAC-based approaches into climate policymaking. This Article provides conceptual clarity about these metrics, focusing on how a MAC-based threshold could sensibly be used in climate policy, and explaining why it is not a substitute for the SCC. We relate the current conversation about valuing greenhouse gas emissions to the longstanding debate over the use of prices versus quantities in climate policy formulation and the more generic regulatory question of when it is appropriate to employ cost-benefit analysis versus cost-effectiveness analysis. In addition, we use illustrative hypothetical policy contexts to explain the roles that these tools should play.
    • Feasibility Analysis and the Climate Crisis

      Driesen, David M. (2022)
      Agencies prepare feasibility analysis when proposing standards limiting greenhouse gas emissions and explicitly base their standard-setting decisions on what is feasible. They do this because the relevant statutes demand maximization of feasible emission reductions. Cost-benefit analysis (CBA) provides a supplement to the statutorily required analysis. This Article argues that the President should limit CBA’s role in light of the urgency of the climate crisis, primarily to minimize delay and clear potential obstacles to effective climate policy. Specifically, the President should repeal the executive orders requiring CBA. While agencies would still have to prepare CBA for very expensive rules under the Unfunded Mandates Act, repeal of those orders would allow agencies to use CBA to inform Congress rather than influence agency standard setting. This Article explains what feasibility analysis is and argues that the need to do all we are capable of doing to avoid, or at least ameliorate, the climate crisis justifies allowing feasibility analysis to displace CBA. Indeed, responsible governments respond to crises by doing all that is feasible to avoid or at least ameliorate them, not by asking whether every action needed to address a crisis generates quantified benefits exceeding the cost. It suggests, however, that the executive branch reorient feasibility analysis to focus more on consumer welfare than on preserving existing firms in light of the need to transform the economy to deal with the climate crisis. The feasibility requirement demands that the goods and services firms provide remain available to consumers, albeit sometimes in altered form, but need not be interpreted to protect existing businesses.