MGMT 211 Lecture 11Outline of Current LectureAgenciesCurrent LectureStarted in the late 1800’s as a direct result of big business becoming powerfulToo much wealth means too much powerBusinesses want to make money, more so than caring for their consumerProducts were starting to hurt peopleFederal government was the only entity that could go against themStarted slowly and built steam; it took a lot of effort and power to reign in these powerful businesses“Silent partner” – they tell you what to do Interstate commerce is vital; if you’re in business, you’re involved in interstate commerceThere is a lot of regulation now – to keep businesses in check3 Eras1. Historical Era – 1887: going after the railroadsa. Some of the richest, most powerfulb. They were getting together and forming trusts; fancy name for a monopolyc. They all got together and decided what prices to charge to ship goods on the railroadi. It was the only way to ship, and everyone was at their mercyd. Interstate Commerce Commission: railroads were obviously involved because they were easily involved in interstate commercei. Leads into anti-trust lawe. A lot of agencies on the federal sidef. Cabinet level positions: secretary of state, secretary of defense, homeland security2. Up until Great Depression = New Deal Era: FDR trying to pull us out of the depressionand get us ready for World War 2a. A lot of the policies implemented are gone b. Shows that they are not set in stone3. Socially Conscious Era: ‘60s and ‘70sa. A lot of agencies were created in this era4. Modern Eraa. They continue to make new regulatory agenciesIndustry Specific Regulatory Agencies: mainly used in the early part of the 1900’s; they go after one particular industryICC: for railroadsSEC: regulate stocks and bondsFCC: regulate communication industry (radio and tv)“regulatory capture” putting the people who need to be regulated in chargeIt happens because we don’t know what’s going on; apathyExample: In the presidential election of 1892, the railroads could give a lot of money to aparticular candidate; the candidate would win, and the railroad companies would use that to get what they want; due to apathy, people let that go on without stopping itEconomy-wide regulatory agencies; in FDR and Historical EraSome created in the New Deal EraFTC: prevent unfair or deceptive advertising They go after everyone; everyone who’s polluting, for exampleFDR: elected for change, and he deliveredRegulatory agencies for all kind of thingsExpanded the size of government Managed to get 4 terms, which is incredibleLegislature: swung in democrats, firmly in control of congressSupreme Court: thought FDR was an idiot, and butted heads with him all the timeSchlecter Poultry v. US: Held that what FDR was doing with the agencies was unconstitutionalFDR threatened to add more justices who aligned with him1944 - Yakus v. US: validBy 1944, the Supreme Court was firmly in his powerAgencies: who controlsUltimately, Congress controls all of them; controls funding, creationDay-to-day basis, depends on the type of agencies1. Executive/Dependent: Cabinet level: directly to the presidenta. The president can fire/replace you b. Administrations, departments, etc. c. FEMA – examplei. One person in charge of these departmentsii. George Bush pressured the man in charge of FEMA to resign after Hurricane Katrina because he wasn’t doing his job2. Independent executive agencies: still dependent, but not under a cabinet level position a. NASA: put it in under this because they didn’t want to stir up troubleb. EPA as wellc. President can fire people at this level as well3. Independent regulatory agencies: regulate businessa. Appointed by, but can’t be removed by the presidentb. Multi-headed; boards in commission made of 5+ members; with this, you get a term of years, not necessarily aligning with the president’s termc. They don’t have to listen to the president or anyone elsed. Long-term, Congress controls them and the president can replace the heads4. Government corporations: federal bureaucracy; has become so important that it is being referred to as the 4th brancha. You don’t elect these people and can’t get rid of themPowers of the Agencies- They have an executive department that is an extension of the president- They can also have independent departments- Congress delegates the powero President may create them, but Congress regulates themo Nixon: Environmental Protection Agency- All agencies must follow the Administrative Procedures Act – Trumano They do not all operate and look the sameo Rule Book with exceptions of what you can and can’t do- Legislative, judicial and enforcement powerso Legislative: they pass laws called administrative law (5th type of law)o 3 types of law they can pass Procedural, substantive, regulatory Can pass regulations that explain the substantive law; more explanatory Substantive: equal weight to an act of congress- You can’t tell OSHA or EPA to “stick it”; they are very powerful How to create them: Administrative Procedures Act- If you pass a substantive rule, it must be done formally; the otherscan be done informally- Formal: substantive rule; promulgate and publish in Federal Register; they have to list hearing dates and places where you can come in to object in an evidentiary style (experts, witnesses)- Informal: whoever the head is promulgates a rule and publish it in the Federal Register; businesses hire someone to read it; gives you30 days to object to it; nothing happens in 30 days with our government, so businesses are screwedo Enforcement: they have their own police division that other branches do not have Brown v. Board: when segregation was ended, the South fought it with everything they had; the president had federal troops escort students into school Congress passed the Civil Rights Act of 1964 and enforced it They can make you suffer in court- If someone is hurt at your workplace, you have to self-report- You have to monitor pollution that you release, and must turn yourself in if you don’t follow those regulations- This is civil, 5th does not apply Inspection team; they have to have an administrative warrant, but that’s it- If you just let them in to inspect (OSHA), it will be easier- In case of emergencies, a warrant is not needed- They can fly over and take a satellite photo – open to the public- If you don’t cooperate,