Symposium Issue: Lawyering for a New Democracy *575



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2002 WILR 575

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(Cite as: 2002 Wis. L. Rev. 575)


Wisconsin Law Review

2002
Symposium Issue: Lawyering for a New Democracy


*575 PUBLIC INTEREST LAWYERS AND NEW GOVERNANCE: ADVOCATING FOR HEALTHCARE
Louise G. Trubek [FNa1]

Copyright © 2002 By the Board of Regents of the University of Wisconsin System;

Louise G. Trubek

Introduction


Scholars and lawyers working in the area of public policy have been preoccupied with the issue of how to maintain social values in a shifting governance framework. Much of the debate has been focused on specific sectors and defensive strategies. In the area of welfare reform, in particular, criticism has been directed at cutbacks in client benefits and reduced provider accountability due to the transfer of authority to local, non-governmental organizations. [FN1] An alternative strand of scholarship has focused on how these same shifts in governance have the potential to produce humane social policy. [FN2] They note the potential for increased participation at the local level, greater collaboration, and reduced adversarial positioning.
The goal of this Article is to place the emerging role of the public interest lawyer in the context of the broader changes that are occurring in American governance. The underlying assumption is that it is better to harness the changes that are occurring for the public good rather than to wax nostalgic for an earlier era of administrative practice. Furthermore, this Article suggests how the emerging system can be harnessed for the public as well as private interest. This Article also illustrates the broader lessons for public interest advocacy through an examination of the managed care healthcare movement.
The analysis of this Article proceeds in four steps. The initial Section outlines the classic model of public interest law in the context of the post- New Deal era. This Article then lays out three broad "movement" changes in governance: a movement of authority downward from the federal government to the state and local level; an *576 outward movement of responsibility for designing, implementing, and enforcing social programs from government to market and non-governmental actors; and a movement outside the regulatory box, away from the traditional regulatory framework. This Article then describes how these changes in governance have encouraged the development of an emerging model of public interest advocacy, which emphasizes collaboration, linked local action, and a diffusion of roles and practices. This model is illuminated through a case study, based on the experience of healthcare lawyers in the regulatory framework of Wisconsin. It describes new processes, tools, and techniques that are developing from the give-and-take that occurs within the new governance context. This description lays out how public interest advocates are seeking to embed the social values of transparency, accountability, and participation within the new governance framework. This Article also addresses the legitimate concerns of progressive scholars and advocates regarding the maintenance of protections required by disadvantaged groups and underrepresented interests. Finally, it concludes that, though the roles and skills of the public interest lawyer must evolve to adapt to the changes in governance, the public interest lawyer will remain a key player in this new scheme.

I. A Brief History of Public Interest Law


In order to achieve a clearer understanding of the new model of public interest advocacy, it is necessary to first understand the classic practice and theory of public interest law and its symbiotic relationship with the structures and theory of government. Since the New Deal, the United States has created or expanded a series of governmental institutions with the goal, at least in part, of creating a more just society. [FN3] The growth of these institutions was part and parcel of the expansion of the federal government and concomitant removal of power from state and local governments. As power moved to Washington, the scope of government action increased as well. It expanded from regulating the market to promoting social welfare. The new social welfare programs took the form of administrative agencies, modeled after agencies that were created to regulate market activity.
In the 1960s and 1970s, this expansion of government intervention and agency power reached its apex. New agencies were created to confront an array of newly recognized issues, such as the protection of the environment and consumers, and the enforcement of minority and women's rights. The Supreme Court, under the leadership of activist *577 justices, also contributed to this evolution through the expansion of individual rights and by allowing citizen access to agency and market institutions. [FN4]
Advocates for disadvantaged clients and groups encouraged the development of these new agencies. The advocates soon concluded, however, that the proliferation of agencies and the expansion of their power contained dangers for their clients. They were distressed by the narrow participation in agency decision-making, the capture of agencies by regulated industries, and the self- interested bureaucracies. To address these perceived problems, advocates adopted various strategies. Advocates for the poor, for example, sought social programs better tailored to the needs of their client groups. [FN5] Consumer activists and environmentalists wanted governmental systems geared towards protecting their interests. [FN6] Law students and lawyers saw a role for expert advocates as representatives for underrepresented clients in these expanding agencies. [FN7]
The expansion of public interest law in these middle decades [FN8] was thus a manifestation both of the growth of agencies and the increasing awareness of their limits. The lawyers seized upon the dissatisfaction with the large Washington-based agencies. They viewed themselves as correcting the lack of participation and accountability in agency procedures by interjecting themselves into the agency process. This development led to the epoch that may be termed the "classic period" of public interest law.
The theories upon which this classic period was rooted were an amalgam of interest group pluralism, market failure, and legal professional expertise. [FN9] The argument was that government institutions alone could not protect the constituencies. The agencies were seen as subject to capture by businesses, legislators were vulnerable to fiscal and local interests, and the judiciary focused on scope of review and creation of abstract rights.
*578 To overcome these obstacles, the voices of disadvantaged constituencies had to be amplified in the decision-making process. The political science theory of interest group pluralism and the economic theory of market failure both supported the concept that the voices of these groups had to be heard in the courts, in Congress, and in the agencies. As Kenneth Arrow stated "much of [private activity] is specifically directed toward more general government failure . . . . When private groups urge reform legislation, they are essentially seeking to repair government's own deficiencies." [FN10]
Added to the political and economic theory was the notion put forth by progressive lawyers and law students that full-time lawyers committed to the social movements should be the spokespersons for the underrepresented. High- level legal skills, knowledge, and status were deemed necessary for effective representation. This movement built on the historic institutional role of the legal profession speaking out for the disadvantaged in our society; contingent fees since the nineteenth century, progressivism and legal aid in the 1910s, and cause lawyering in the 1920s were the forerunners. [FN11] The lawyers viewed themselves as providing the remedy needed to produce government action that appropriately intervened in the private market. The remedy was implemented by voicing the needs and approaches that served the "true" beneficiaries of government agencies. In addition to providing the input of the voices into traditional bureaucratic hearings and rule-making processes, they also provided constant monitoring of agency actions and procedures to insure that the actions were transparent and subject to public scrutiny.
The organizational embodiment of this theory was the public interest law firm. These firms blossomed in the 1960s and the early 1970s, [FN12] founded by lawyers, who were largely young graduates of elite law schools. Most of these firms were located in Washington and consisted almost exclusively of lawyers organized as independent, nonprofit law firms. The lawyers advocated primarily in federal courts, federal agencies, and before Congress. Among the clients were groups deemed to be "underrepresented": interests that could not be funded by the market for lawyers. Examples of such groups are poor people represented by the Legal Services Corporation, consumers seeking fair products in Nader firms, and environmentalists in the Natural Resources Defense Council seeking a sustainable world.
*579 Initially, the vision for funding these firms was based upon a charitable model supported by private foundations, bar associations, and court- awarded fees. There was also, however, an effort to obtain support from the government, using the argument that public interest lawyers provided the necessary check upon the agencies and that government should support these advocates. The Legal Services Corporation was enacted as a result of this argument. [FN13] These firms became canonical within government and the legal profession. In fact, the conservatives emulated their success in the late 1970s and 1980s. [FN14]

II. The Changing Nature of Governance and Shifts in Public Interest Law


For the past several decades, the administrative state has been undergoing a process of change. Trust in the expertise of federal agencies has been replaced by skepticism and even outright disdain. The desire for centrally coordinated government solutions to vexing social problems has given way to a thirst for local control, and the role of the private sector in designing and implementing experimental programs has been revived. Decentralization, deregulation, and privatization are the catchwords of the day, and whether driven by, or reflected in, the federalism of the Supreme Court and the platforms of various politicians from Jimmy Carter to George W. Bush, [FN15] this new style of governance has influenced both institutional relations and professional roles at the most intimate level. Legal scholars have begun to take notice of these deep and seemingly permanent changes in the administrative state. [FN16]
They have just started, however, to come to grips with the effect of the new governance on the public interest in general. More specifically, scholars are just beginning to understand the impact of the new governance on public interest advocacy, often assuming that a decentralized form of governance is clearly beneficial to the public interest or potentially harmful. Practitioners are also noting the changes *580 in the world within which they advocate. They see that the structures that they assumed would confine their advocacy are opening up in strange and unexpected ways. In response, practitioners are notably beginning to shift their advocacy. This Section describes the governance changes and then ties practitioner shifts to these governance shifts.
American governance has become increasingly decentralized in at least three separate directions. First, there has been a movement of authority downward from the federal government to state and local governments. Second, there has been a shift of regulatory mechanisms outward to non-governmental actors, including non-profit and private businesses. Third, there has been what can be described as a leap outside the regulatory box as new mechanisms are created that did not exist before and that do not fit neatly into the traditional notion of top-down regulation. Each movement, described more fully below, has important implications for understanding the changes that have taken place, and continue to take place, in the world of public interest advocacy.

A. The Movement Downward


Perhaps the most conspicuous aspect of the new approach to governance is the movement of authority downward from federal to state and municipal governments. This "localization" of governance is in stark contrast to the ethos of the New Deal era that, in the process of responding to the misery of the Great Depression, taught Americans to look to the expertise of federal administrative agencies for solutions to social, political, and economic problems. [FN17] Trust and confidence in federal agencies, however, began to wane in the 1970s due in part to general social unrest and the political pressures brought about by inflation. There developed a consensus that the federal government had assumed too many responsibilities and grown too large. Aided by the Supreme Court's new federalism, [FN18] authority began to shift back to the states. [FN19]
Welfare reform is the hallmark of this process of devolution. In 1996, President Clinton, backed by a conservative Congress, replaced the decades old Aid to Families with Dependent Children (AFDC) *581 program with the enactment of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA). [FN20] Whereas AFDC had relied on federal subsidies and a centralized administrative system, the new program provided individual states with incentives to remove people from the welfare roll and put them back to work, fostering individual responsibility and initiative. Some of the early critics of the new program have since been won over, but it remains to be seen whether the new program can remain a success in more difficult economic times.
Rather than a mere anomaly, welfare reform is regarded as the "maturation of a generation-long trend that fundamentally transformed community governance." [FN21] Just as the Supreme Court justifies its new federalism by invoking the positive effect that deflecting responsibility to lower levels of government has on public participation in the legislative process, so too has Congress defended its actions in terms of the benefits devolution has bestowed upon local governments and individuals. The bottom line, however, appears to be that it has saved the federal government billions of dollars, earning proponents of the legislation a great deal of political capital. In the current debate on reauthorization of PRWORA, there is little organized effort to return power to the federal government. State and local agencies, now running the programs, have coalesced in alliances to support the devolution. [FN22]

B. The Movement Outward


A second trend in American governance undermines the New Deal era's trust in government, whether at the federal, state, or local level. [FN23] Instead of giving government agencies the responsibility for designing and implementing social programs, Americans today are increasingly shifting the responsibility for these tasks outward to market forces and non-government actors.
The shift of responsibility to market forces occurs through deregulation. [FN24] Although deregulation began in the early 1970s, it did *582 not really take hold until later, in part because Americans found it difficult to give up the security and control that comes with a hierarchically-imposed regulatory framework. The arguments in favor of deregulation, however, proved to be overwhelming in the face of a general skepticism and disdain for government control that emerged in the wake of the Vietnam War and scandals from Watergate to Waco. Congressional gridlock frustrated Americans and heightened their dissatisfaction with government even further; the unpredictable movement of the market eventually came to be seen as preferable to no movement at all. While deregulation remains controversial, for the moment, the lesson appears to be that not all deregulation plans are created equal; some are clearly better than others. The challenge will be to distinguish among the many options available, finding an appropriate balance between market forces and government intervention. [FN25] States continue to experiment with deregulation, attempting to find the appropriate balance.
A second option available to politicians has proven equally tantalizing. Rather than abandon government functions altogether, politicians and agency heads at every level are increasingly turning to non-governmental actors, such as private businesses, faith-based charities, and other non-profit organizations to carry out these duties. [FN26] Thus, privatization has permitted the visible size of government to shrink while allowing the actual amount of public services to expand, thus pleasing both the liberal and libertarian impulses in the voting public. [FN27] Public administration scholarship over the past two decades *583 shows that much of the federal government's work is carried out through "an elaborate network of contracting, intergovernmental grants, loans and loan guarantees, regulations, and other indirect administrative approaches." [FN28] Reportedly, for every federal worker, there are now nine "shadow" employees working in local government or the private sector carrying out the federal government's operations. [FN29] Despite increasing consumer awareness that certain traditional governmental services are no longer being provided, the trend toward privatization appears to continue.

C. The Movement Outside the Regulatory Box


The downward movement of government programs to the state and local level, and the shift outward of responsibility for the management and implementation of these programs to the private sector, has had a secondary effect which will ultimately prove crucial for understanding how advocacy has shifted. In the new regulatory environment, new mechanisms have emerged to monitor, guide, and direct those public and private agents who exercise direct control over particular social programs. Because these mechanisms are not established or connected to a formal government agency, they constitute a leap outside the regulatory box. As a result of the recent changes in information technology, many of these mechanisms have evolved on their own without any conscious government guidance or involvement. The Internet, for example, provides the ability to disseminate information quickly and efficiently at minimal cost. Informal monitoring systems have been established, creating new opportunities for citizen and consumer involvement. Private actors who wish to sidestep the traditional regulatory procedures may use these informal systems. In this manner, these new regulatory mechanisms have helped break down the barriers between the enactment, implementation, and revision of government programs. The end result is that we live in a much more dynamic, fluid regulatory environment than before.
One consequence of stepping outside the regulatory box is that the box itself becomes less important. For some time, such a de-emphasis on formal agency structures has been observed. Richard Stewart has noted that reliance on agency expertise is one of the first "solutions" *584 to the problem of agency discretion. [FN30] This reliance made sense under the traditional model of administrative law, which viewed an agency's role as that of a "manager or planner with an ascertainable goal." [FN31] Stewart argued, however, that a number of factors have undermined this trust in agency expertise. First, the American public has lost faith in an objective basis for social change. Rather than seeing agency actions as methodical steps toward an objective goal, the exercise of agency discretion is now seen as "the essentially legislative process of adjusting the competing claims of various private interests affected by agency policy." [FN32] Second, steady economic growth since World War II shifted focus to distributional questions in administrative law, which do not turn on technical issues that can be safely left to agency experts. [FN33] Third, agencies themselves have come to be seen as subject to biases that affect the outcome of their decisions. As such, they are no longer looked upon as neutral arenas of impartial, professional judgment. Rather they are seen as highly politicized entities. In fact, agency bias is thought to favor industry over consumer interests. [FN34] Extra- agency mechanisms are supplementing, if not replacing, the administrative agencies. Today, the presence of these mechanisms underscores the pervasive disenchantment with the traditional model of administrative law.

D. The Emerging Model of Public Interest Advocacy


The current regulatory climate is creating a disconnect for the classic strategy and practice of public interest law. Due to devolution, privatization, and deregulation, problems and assumptions have changed, thus it should not be surprising that there is a disconnect at both the practical and theoretical level. These changes are forcing the strategies of public interest lawyers to evolve.
The classic public interest law movement saw government, especially the federal government, as the primary vehicle for implementing social values. Participating within the structure of the centralized state authority was viewed as the way to effectuate democratic values. As the authority shifted to local units, however, the types of participation had to change. Advocates are now dealing with a variety of state and local agencies that are numerous and difficult to locate. They can no longer advocate exclusively before Washington-based agencies closely linked to Congressional leadership. The *585 efficiencies of a single level of government, permitting a system where expert and experienced public interest lawyers affected important decisions by providing advocacy before a single agency with a limited number of decision- makers, are gone. This system of a few expert lawyers providing advocacy for decisions that affected millions kept the costs of providing public interest advocacy at a level that could be met through charitable contributions and fee awards.
The traditional public interest law model did not view markets as a vehicle for achieving justice. Public interest lawyers understood the importance of the market to governance structures, but they viewed strong agencies as the way to curb and cabin the power of markets. This pro-agency movement emphasized the use of private agencies contractual relationships, and competitive service delivery. These changes undercut the tools and strategies that public interest lawyers had traditionally employed. It has become difficult to locate the agency providing the services because the contracting process is hard to figure out. The private agencies do not have to comply with open records and meetings acts, or certain due process procedures. [FN35] The substantive provisions are included in contracts rather than through the traditional rulemaking system developed under the Administrative Procedure Act. For example, in welfare reform, when privatization occurred, the lawyers found it very difficult to figure out how to attack the abuses that occurred because there was no one responsible agency. [FN36]
The disenchantment with the expert model of the administrative agency is accompanied by a more widespread disenchantment with the notion of professional expertise. This disillusion affected public interest lawyers because they based their model on the view that their skills and knowledge were needed to augment the expertise of the agencies. They viewed themselves as the antidote to powerful agencies and influential business interests: they saw themselves as powerful lawyers equipped with expertise to combat the hidebound bureaucrats and greedy business interest. The move out of the regulatory box threatened the legitimacy of the public interest lawyers' role.
These changes in the classic system require a rethinking of where and how public interest lawyers work. As the bureaucracies lose their strength and new technology emerges, new strategic understandings and organizational structures must be developed. The new practices--collaboration/shared experience, linked local action, and diffusion--are explored below.

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