JOL Online Notes

WARNing: The “Liquidating Fiduciary” Exception Should Not Exist

Jonathan C. Gordon*

 

Abstract

The Worker Adjustment and Retraining Notification Act requires employers of a sufficient size to provide sixty days’ notice to employees affected by plant closings or mass layoffs. The Department of Labor, meanwhile, said that fiduciaries that are liquidating a business do not have to comply with that notice requirement. Courts have uniformly held that such a “liquidating fiduciary” exception exists. I disagree; there is no such exception.

Using traditional tools of statutory interpretation, I submit that Congress did not mean for such an exception to apply. Thus, Congress should clarify the WARN Act and make clear that there is no exception for “liquidating fiduciaries.” Until then, however, courts should stop applying the exception.

 

Introduction

Congress passed the Worker Adjustment and Retraining Notification Act (the “WARN Act” or “WARN” or the “Act”) in 1988.[1] The Act requires certain employers to provide sixty days’ notice to employees affected by plant closings or mass layoffs.[2] The Act defines “employer” as “any business enterprise that employs—(A) 100 or more employees, excluding part-time employees; or (B) 100 or more employees who in the aggregate work at least 4,000 hours per week (exclusive of hours of overtime).”[3]

If an employer fails to give proper notice, the “employer . . . shall be liable to each aggrieved employee who suffers an employment loss as a result of such closing or layoff for” backpay and benefits.[4] That backpay is “a statutory form of severance pay.”[5] More specifically, because severance pay comes in two forms—(i) pay in lieu of termination notice and (ii) pay based on the employee’s length of service—WARN backpay is “severance pay in lieu of notice, imposed by statute.”[6] As one bankruptcy court explained:

WARN gives the employer a choice—it may provide 60 days’ notice of closing or layoff to its employees, keeping the business open and incurring operating expenses during that period; or it may shut down its operations with little or no notice to its employees, saving operating expenses, but providing back pay to its employees, in compensation for the lack of notice, in accordance with a statutory formula.[7]

The Act further requires that the Department of Labor (the “Department”) “prescribe such regulations as may be necessary to carry out” the Act.[8] In the Department’s Analysis of the Final Rule, the Department commented that a “liquidating fiduciary” does not satisfy the Act’s definition of “employer.”[9] Specifically, the Department wrote:

[A] fiduciary whose sole function in the bankruptcy process is to liquidate a failed business for the benefit of creditors does not succeed to the notice obligations of the former employer because the fiduciary is not operating a “business enterprise” in the normal commercial sense. In other situations, where the fiduciary may continue to operate the business for the benefit of creditors, the fiduciary would succeed to the WARN obligations of the employer precisely because the fiduciary continues the business in operation.[10]

A proper understanding of the “liquidating fiduciary” exception first requires a proper understanding of a liquidating fiduciary. When a business is financially distressed, it may choose to file for bankruptcy protection under the United States Bankruptcy Code. Typically, the business has two options: chapter 7 or chapter 11.[11]

If a business files under chapter 7, then a trustee is automatically appointed[12] to replace the debtor’s management and to liquidate the business.[13] Thus, the “liquidating fiduciary” exception is most applicable in chapter 7 bankruptcies—where a trustee (a fiduciary) is appointed to liquidate the business.[14]

If a business files under chapter 11, however, then a trustee is not automatically appointed.[15] Rather, the debtor’s management stays in possession of the business,[16] provided that the management does not engage in fraud or gross mismanagement.[17] As such, the debtor is called a “debtor in possession.”[18] The debtor in possession, however, has all the duties and responsibilities of a trustee.[19] Thus, just like trustees, debtors in possession are also fiduciaries.[20]

But in chapter 11, the debtor is not required to liquidate, though it may choose to do so.[21] Rather, chapter 11 permits the debtor to continue operating the business as a going concern while it restructures its debts.[22] Thus, it is not clear whether the “liquidating fiduciary” exception applies to chapter 11 debtors because the “sole function”[23] of a debtor in possession is not to liquidate.[24] Regardless, though courts dispute the proper contours of the exception, they do not dispute the exception’s existence. All the courts that have considered whether a “liquidating fiduciary” exception exists for fiduciaries in bankruptcy have uniformly answered in the affirmative.[25] Humbly, I submit that those courts have uniformly erred.

This Article proceeds in three parts. Part One examines some of the precedent on the “liquidating fiduciary” exception. Part Two presents my thesis—traditional tools of statutory interpretation prove that the WARN Act includes businesses being liquidated by fiduciaries, contrary to what courts uniformly have held. And Part Three explains that judicial deference to the Department’s interpretation is not warranted.

 

Part One: Examining the Precedent

Unfortunately, due to limited space, I cannot discuss all the cases that address the “liquidating fiduciary” exception.[26] That said, nothing in them would materially alter this discussion. Instead, I want to focus on two particular cases, In re Hanlin Group, Inc.[27] and In re United Healthcare Systems, Inc.[28]—each of which is noteworthy for a unique reason. Hanlin was the first court to determine whether a fiduciary in bankruptcy is subject to the WARN Act requirements. And United Healthcare, a decision from the Third Circuit, is the leading authority on the issue.

          I. Hanlin (Bankr. D.N.J. 1995)

Hanlin Group filed for bankruptcy protection under chapter 11 and, as a result, became a debtor in possession.[29] After filing its bankruptcy petition, Hanlin Group terminated employees without providing sixty days’ notice, as required by the WARN Act.[30] The employees’ union sought $1.2 million in damages for the layoffs.[31]

The court first looked at whether the debtor in possession was an employer under the WARN Act.[32] The court’s entire (and limited) analysis on the issue relied on the Department’s commentary.[33] The court did not refer to the statutory definition of “employer,” nor did the court consider what constitutes a “business enterprise.”[34] Rather, the court quoted the Department’s “liquidating fiduciary” exception before holding that Hanlin Group qualified as an employer because it “continued to operate the business as a whole for the benefit of all parties in interest.”[35] The court, thus, clearly adopted the exception to determine what qualifies as a WARN Act employer, even if the court found the exception inapplicable due to the specific facts.

In short, the first court to use the “liquidating fiduciary” exception to determine the status of an employer in bankruptcy, for purposes of the WARN Act, did so without an iota of statutory interpretation.

          II. United Healthcare (3d Cir. 1999)

Courts widely consider the Third Circuit’s decision in United Healthcare to be the leading authority on the issue.[36] United Healthcare featured a non-profit corporation (United Healthcare System, Inc.) in financial distress.[37] Because of its financial troubles, United Healthcare did the following:

• United Healthcare’s board voted to sell the company’s assets and shut down the hospital.[38] As part of the shut down, the hospital surrendered its certificates of need to the New Jersey Department of Health and advised the department that it was closing.[39]
• The hospital then voluntarily filed for chapter 11 bankruptcy relief.[40]
• On the same day as its bankruptcy petition, the hospital, pursuant to the WARN Act, gave 60 days’ notice of termination to its approximately 1,300 employees.[41] The notice stated that the employees should continue reporting to work until the termination date (60 days).[42]
• Because the hospital no longer had patients, however, employees did not perform their regular duties.[43] Rather, they “cleaned, took inventory and prepared the company’s assets for sale.”[44]
• Within a month after the bankruptcy petition, the Official Committee of Unsecured Creditors of United Healthcare System (the “Committee”) asked the bankruptcy court “to order United Healthcare to terminate all employees immediately.”[45]
• Before the court ruled on the Committee’s motion, United Healthcare dismissed 1,200 employees, forty-four days before the termination date.[46]

United Healthcare and the Committee then disputed whether these 1,200 employees were entitled to WARN Act back pay for the remaining forty-four days of the notice period.[47] The hospital believed that it did owe the employees for the back pay, but the Committee argued otherwise.[48] The Committee believed that United Healthcare was no longer a WARN Act “employer” because the hospital had surrendered its certificates of need with the aim to liquidate.[49]

The bankruptcy court, guided by the Department’s commentary, agreed with the hospital.[50] Because the hospital was still operating the business for the benefit of creditors,[51] the court held that the hospital’s employees were entitled to WARN Act back pay for the early termination.[52] The district court affirmed.[53] On appeal, the Third Circuit faced one question: “whether the [lower courts] correctly concluded United Healthcare continued as an ‘employer’ within the meaning of the WARN Act after filing for Chapter 11 bankruptcy . . . .”[54]

The court first turned to the Act’s definition of employer.[55] But the court found the definition “general and not especially helpful in determining whether a particular employer is subject to WARN.”[56] Nonetheless, the court pulled two requirements out of the definition: an employer (1) must employ a certain number of employees and (2) must be a “business enterprise,” which the court noted is not defined by the Act.[57] The court found that United Healthcare clearly met the first requirement, but it was less clear that United Healthcare remained a business enterprise.[58] The court pointed to the hospital’s contrasting activities. On one hand, the company had

surrendered its certificates of need, stopped treating patients, and entered bankruptcy to liquidate its assets. Each of these events precluded United Healthcare from performing the everyday business functions of a hospital and health care service. On the other hand, despite those events, United Healthcare remained a corporation that employed for sixteen days a substantial number of employees to whom it assigned various tasks all related to shutting down its operations.[59]

Because of this perceived ambiguity,[60] and because the term “business enterprise” had no statutory definition, the court quickly turned to the Department’s commentary for guidance.[61] The court found the commentary persuasive and adopted the Department’s “liquidating fiduciary” exception.[62] The relevant test, thus, was whether United Healthcare had continued “operating its business as a going concern.”[63]

The court’s initial finding of ambiguity, however, seems to rest on the assumption that a business enterprise is one performing “everyday business functions.”[64] This assumption is wrong.[65] Had the court interpreted the term “business enterprise,” instead of quickly turning to the Department, it would have found that the term does not require “everyday business functions.”[66] Rather, it would have found that the term’s meaning is clear.[67]

***

A common theme runs through the two above cases. Neither interpreted the statute to determine what constitutes a WARN employer. Hanlin does not refer to the statutory definition and gives no thought to what constitutes a “business enterprise.”[68] And while United Healthcare at least looked at the definition of “employer,” the court then assumed that a business enterprise must be “performing everyday business functions.”[69] Other than noting that the Act did not define “business enterprise,” the court did not do any other statutory interpretation before turning to the Department’s commentary.[70]

If either of these courts (or the other courts that have uniformly adopted the exception)[71] had more rigorously applied the traditional tools of statutory interpretation to the statute—rather than turning quickly to the Department’s commentary—they would have found that the WARN Act unambiguously includes businesses being liquidated by a fiduciary.

 

Part Two: Statutory Interpretation

Because the WARN Act defines “employer” to be “any business enterprise that employs” a certain number of people, the issue faced is first and foremost one of statutory interpretation—what does the term “business enterprise” mean under section 2101(a)(1) of the WARN Act?[72]  More specifically, does it include a business that is being liquidated by a fiduciary? Based on traditional tools of statutory interpretation,[73] the answer should be yes. Irrespective of the Department’s guidance, the Act’s text should control because of the Act’s (i) plain language, (ii) structure, (iii) legislative evidence, and (iv) purpose.

          I. Plain Language

Interpreting a statute requires first looking at the statute’s language.[74] Section 2101(a)(1) of the Act defines an employer as “any business enterprise that employs” 100 or more employees. The Act does not, however, define “business enterprise.”[75] “When Congress has not supplied a definition, [the Supreme Court] generally give[s] a statutory term its ordinary meaning.”[76] I suggest that the ordinary meaning of “business enterprise” is a business entity[77]—whether it be a large public corporation or a small private partnership. Under such an ordinary meaning, a business in bankruptcy is still a business enterprise even though it may be liquidating.

Critics of my interpretation may wonder why Congress would use redundant language; if Congress said “any business enterprise” then surely it meant something other than “any business” because Congress explicitly added another word.[78] Congress’ language, however, may be understandable as a term of art. Congress has used “business enterprise” when writing other laws[79] and has routinely referred to a “business enterprise” as a business:

• Section 1221 of title 15 defines “automobile manufacturer” as “any person, partnership, corporation, association, or other form of business enterprise . . . .”[80] Thus, the language implies that a business enterprise is defined as a business, whether it be a partnership, corporation, or association.
• Section 7108 of title 15 defines “women’s business enterprise” as “(A) a business or businesses owned by a woman or a group of women; or (B) the establishing, maintenance, or development of a business or businesses by a woman or a group of women . . . .”[81] Here, the language clearly equates “business enterprise” with “business.”
• Section 3102 of title 22 defines “business enterprise” as “any organization, association, branch, or venture which exists for profitmaking purposes or to otherwise secure economic advantage . . . .”[82] This definition is synonymous with—arguably, even broader than—a for-profit business.
• Section 1452 of title 28, in governing class action removals, excludes certain class actions that relate “to the internal affairs or governance of a corporation or other form of business enterprise . . . .”[83] A corporation, thus, is one form of a business enterprise. Other forms presumably include other business entities such as associations, partnerships, LLCs, etc.
• Section 6705 of title 42 defines “minority business enterprise” to be “a business at least 50 per centum of which is owned by minority group members . . . .”[84] Yet again, the legislature has explicitly equated “business enterprise” with “business.”
• Section 7141 of title 42 defines “minority business enterprise” to be a “firm, corporation, association, or partnership which is at least 50 percent owned . . . .”[85] A business enterprise, thus, includes corporations and other business entities.

In a similar vein, one district court, in giving jury instructions for a case on illegal gambling activity, explained that “a business enterprise usually involves a continuing course of conduct by persons associated together for a common purpose.”[86] On appeal, the Eighth Circuit found no error with the instructions.[87]

A business in liquidation could meet that definition: the business is a group of persons associated together (whether it be directors, managers, shareholders, or employees) continuously working together in a course of conduct—albeit that conduct is to further liquidation, rather than operations.[88] But even if that argument is not persuasive, a business in liquidation could still satisfy the definition of a business enterprise in United States v. Scavo.[89] Scavo only said that “a business enterprise usually involves a continuing course of conduct by persons associated together for a common purpose.”[90] So even if a debtor’s liquidation is not a continuous course of conduct, it is possible that the debtor is still a business enterprise, outside the usual universe suggested by Scavo.

Indeed, the Department itself even implied as much—that a liquidating business is still a business enterprise. The Department commented that a liquidating business is not a “‘business enterprise’ in the normal commercial sense.”[91] This language implies that a liquidating company is a business enterprise in some kind of non-normal or non-commercial sense. Likewise, the Third Circuit in United Healthcare found ambiguity because the company was not performing “everyday business functions.”[92] In making such a finding, the court implicitly limited the Act to normal, operating businesses.

The WARN Act, however, does not restrict the definition of “employer” to only functioning business enterprises of a normal or commercial sense. Nor does the Act define “employer” to be an operating business enterprise. Under either definition, the Department’s interpretation (and the Third Circuit’s analysis) would be more meritorious. The Department’s exception, however, improperly adds those qualifications to the Act’s definition. The WARN Act solely defines “employer” as “any business enterprise.”[93]

In response, the Department may argue that such qualifications (i.e., requiring that the business be operating in a normal commercial sense) are implicit—that Congress implied that a business enterprise must be operating because the prototypical business enterprise is one in operation.[94] The Act’s definition, however, does not say “a business enterprise,” which could suggest a prototypical interpretation. Rather, the definition of “employer” says “any business enterprise”[95]—regardless of whether that business is operating or liquidating. “As [the Supreme Court] ha[s] explained, ‘the word “any” has an expansive meaning, that is, “one or some indiscriminately of whatever kind.”’”[96] Courts must adhere to the WARN Act’s broad language—with its expansive meaning—and refrain from adding the Department’s restrictions.

In sum, the language of section 2101(a)(1) is clear. The term “business enterprise”—with its ordinary meaning and similar usage in other legislation—is synonymous with the term “business.”[97] And the WARN Act broadly states that “any business enterprise” (thus, “any business”) of the required size must adhere to the notice requirements.[98] Because the word “any” requires an expansive reading, it does not matter whether that business is liquidating or functioning in the normal commercial sense.[99] Holding otherwise would be adding words to the statute and legislating from the bench.

          II. Structure and Interpretative Canons

Sticking with the text, “[w]hen Congress provides exceptions in a statute, it does not follow that courts have authority to create others. The proper inference . . . is that Congress considered the issue of exceptions and, in the end, limited the statute to the ones set forth.”[100] That inference stems from the expressio unius canon of statutory interpretation: “expressing one item of [an] associated group or series excludes another left unmentioned.”[101]

Explicitly providing exceptions thus excludes unmentioned exceptions. The Act explicitly provides for three exceptions. Under the “faltering company” exception, an employer does not need to give the required notice if the employer “was actively seeking capital or business” which would have allowed the employer to avoid layoffs, and the employer believed that “giving the notice required would have precluded the employer from obtaining the needed capital or business.”[102] Under the “unforeseeable business circumstances” exception, an employer need not give the required notice if the layoffs are “caused by business circumstances that were not reasonably foreseeable” at the time notice was required.[103] Last, under the “natural disaster” exception, an employer is not required to give notice if the layoff is due to a natural disaster.[104]

Indeed, the Act’s “faltering company” exception considers financially troubled employers. The proper inference, thus, is that Congress considered how the WARN Act would affect financially troubled employers and decided not to provide another shield for bankrupt employers.  Had Congress intended a safe harbor for employers liquidating in bankruptcy, it could have done so explicitly.

Admittedly, the expressio unius canon is not absolute. It “is only a guide, whose fallibility can be shown by contrary indications”[105] to “all other textual and contextual evidence of congressional intent.”[106] Here, however, there are no contrary indications. All tools of statutory interpretation point in the same direction. The Act’s language is clear and further supported by the legislative evidence and overall purpose.

          III. Legislative Evidence

The legislative history of the WARN Act is convoluted, but the meaning of “business enterprise” is not. As discussed below, Congress meant for “business enterprise” to be “synonymous with the terms company, firm or business.”[107]

The WARN Act traces its roots to the Omnibus Trade and Competitiveness Act of 1987 (the “Omnibus Act”),[108] intended to “enhance the competitiveness of American industry.”[109] The bill did not contain any provisions related to the WARN Act, however.[110] The Senate, unhappy with the House bill, introduced a bill of amendments to the Omnibus Act.[111] Among many other changes to the House bill, the Senate amendments added a new section titled “Advanced Notification of Plant Closings and Mass Layoffs.”[112]

That section was the foundation of today’s WARN Act and defined an “employer” as “any business enterprise that employs—(A) 50 or more full-time employees; or (B) 50 or more employees who in the aggregate work at least 2,000 hours per week (exclusive of hours of overtime).”[113] That definition is the same definition found in the WARN Act, except the minimum number of required employees has been upped to 100.[114] The WARN Act, thus, started as a subsection of amendments to the Omnibus Act.

In attempts to reconcile the Omnibus Act Senate amendments with the original House bill, the two houses formed a conference and filed an agreed-upon conference report.[115] A conference report “is generally the most reliable evidence in legislative history of congressional intent because it represents the final statement of the terms agreed to by both houses.”[116] With regards to the WARN Act, the conference report “retain[ed] the Senate Amendment language that the term ‘employer’ means a business enterprise.”[117] Further, the conference report added that “‘business enterprise’ be deemed synonymous with the terms company, firm or business.”[118]

The President eventually vetoed the Omnibus Act.[119] In response, the Senate introduced the WARN Act as a separate bill, retaining the same language that “employer” means “any business enterprise.”[120] Like the Omnibus Act, the Senate’s introduced bill did not define business enterprise.[121] Within a month, the House and Senate had passed the bill.[122] And within two months, the bill became law.[123] A conference between the two houses thus was unnecessary, so there is no conference report specific to the WARN Act. As a result, and because the language of “employer” did not change, the conference report to the Omnibus Act provides the best indication of what “business enterprise” means. It means a company, firm, or business.

As discussed earlier, when Congress has used “business enterprise” in other legislation, it has statutorily defined “business enterprise” to be synonymous with those terms. The legislative evidence here, thus, proves that the WARN Act is no different and confirms the earlier textual analysis. As a result, any company, firm, or business that satisfies the defined size must adhere to the Act’s notice requirements—regardless of whether that business is liquidating or operating in a normal commercial sense.

          IV. Purpose

Last, the purpose[124] of the WARN Act is to protect employees and their families from being unexpectedly laid off.[125] By providing notice, employers give employees the opportunity to pursue other employment and relocate, if necessary.[126] Excusing fiduciaries from providing notice does not protect employees.

Consider the practical implications of the Department’s exception. Imagine a company, BigBiz. BigBiz is in financial distress. It is working with bankruptcy lawyers and is preparing to file for chapter 7 bankruptcy relief—say, on Tuesday. The company knows it will be shutting down. And so on Monday, the CEO of BigBiz contemplates terminating a substantial number of employees. After all, there is no need for them because the company is shutting down. But, the company never gave proper WARN notice, so it would face certain WARN liabilities.

On the other hand, the company realizes that the company would face no WARN liability if the employees were terminated during the bankruptcy liquidation. Under the purported “liquidating fiduciary” exception, the bankruptcy trustee would not be subject to the same notice requirements that the company’s management had a second before the bankruptcy filing.

To reiterate, if the CEO of BigBiz terminated BigBiz employees on Monday, without any notice, then BigBiz would be liable for sixty days’ back pay to those affected employees. But if BigBiz files for chapter 7 bankruptcy Tuesday morning, and the appointed trustee of BigBiz terminates the employees without any notice on Tuesday afternoon, then BigBiz has no liability. This stark dichotomy could motivate businesses to not give any notice of terminations if a liquidation is on the horizon.[127]

The WARN Act essentially gives employers a choice: (1) they can provide proper notice while continuing to operate and bear related operational expenses or (2) they can shut down without proper notice and save on operational expenses, but provide back pay to employees to compensate for the lack of notice.[128] Essentially, the optimal solution is a mathematical equation—until the “liquidating fiduciary” exception is applied. With the exception, businesses can enjoy the fruits of option two (shut down with no operational expenses) while bearing none of the costs (back pay in lieu of notice). Who, then, bears those costs? The employees. This lack of protection for employees stands strictly at odds with the purpose of the WARN Act.

One could (rightly) argue that it would be inequitable to hold a liquidating fiduciary liable when it had no prior involvement with the business and was appointed solely to sell company assets. However, and I stress this point as it seems to have become convoluted due to the Department’s language, the trustee would not be the party liable. WARN Act liability falls on the employer, the business enterprise—not its managers or executives or trustees or any other individuals.[129]

More specifically, the debtor’s bankruptcy estate would bear the costs of WARN liability because all assets and liabilities of the employer are part of an estate in bankruptcy.[130] One could then argue that it would be unfair to hold the estate (which includes creditors and other parties in interest) liable. But if that is the exception’s purpose, then there should also be an exception for companies that violate the WARN Act while operating as a going concern during bankruptcy (i.e. reorganizing rather than liquidating). When a debtor is forced to pay WARN liabilities to employees, the estate has less money available to pay creditors—regardless of whether the debtor is liquidating or reorganizing. Thus, because the Department’s exception only concerns liquidations, I doubt that the exception’s concern is that creditors are harmed indirectly. If that were true, there would also be an exception for reorganizations.

***

In addition, the WARN Act “is a remedial statute and must be construed broadly.”[131] As a result, exceptions must be “narrowly construed” and “the employer has the burden to prove the exception applies.”[132] Coupled with this high burden, the statutory analysis demonstrates that no “liquidating fiduciary” exception exists.

 

Part Three: But What About Judicial Deference?

When a court is tasked with interpreting an administrative agency’s law, and the agency has offered its interpretation, the court must determine if that interpretation is entitled to judicial deference—whether it be Chevron (strong) deference or Skidmore (weak) deference.[133]

          I. Chevron deference

Though Chevron is under attack by judges, academics, and legislators,[134] it remains good law and must be dealt with.[135] Under Chevron, deference is required when (i) a statute’s meaning is unclear and (ii) the agency’s interpretation of that statute is reasonable.[136] This Chevron framework generally applies to interpretations that are offered through notice-and-comment rulemaking.[137] But Chevron can also apply elsewhere.[138]

To determine whether the Chevron test applies to a guidance document outside notice-and-comment rulemaking—like the Department’s Analysis, at issue here—courts look at various factors: “‘the interstitial nature of the legal question, the related expertise of the Agency, the importance of the question to administration of the statute, the complexity of that administration, and the careful consideration the Agency has given the question . . . .’”[139]

Here, however, those factors do not require analysis because even if the Chevron test does apply, deference would still not be warranted. If Chevron applies, then analysis begins with the first step—is the statute’s meaning clear, as determined by “traditional tools of statutory construction”?[140] As discussed in Part Two of this Article, the WARN Act is clear and includes businesses being liquidated by fiduciaries.[141] Because the first step is answered affirmatively, the Chevron test ends.[142] The test never reaches the second step (deference).[143]

          II. Skidmore deference

Skidmore deference is weaker.[144] Unlike Chevron deference, Skidmore deference is not binding.[145] Rather, Skidmore interpretations are “entitled to respect” and can be looked upon for guidance.[146] But because the WARN Act is clear enough to overcome Chevron deference, it would also overcome the weaker Skidmore deference. Whatever respect the Department’s commentary deserves, it is not enough to overcome the WARN Act’s unambiguous language.

 

Conclusion

The WARN Act requires “any business enterprise” that meets certain size requirements to give sufficient notice to employees before a mass layoff or plant closing.[147] In its Analysis on the Final Rule, the Department of Labor purportedly created a “liquidating fiduciary” exception on the grounds that a “liquidating fiduciary” would not be operating a company in the normal commercial sense. Courts have uniformly adopted that exception.

Those courts, however, have uniformly erred. As the text, structure, legislative evidence, and purpose of the WARN Act make clear, the Act does not exempt businesses being liquidated by fiduciaries. Any business of the required size is subject to the Act’s notice requirements—regardless of whether that business is liquidating or operating. Thus, irrespective of the Department’s commentary, the WARN Act is clear and its meaning must control: there is no “liquidating fiduciary” exception.

* University of Notre Dame (B.B.A. cum laude, 2015); Northwestern University (J.D. cum laude, 2018). Special thanks to Andrew Dawson, David Neff, and Victoria Nourse for helpful feedback. Thanks also to Katherine Drews and Louis Murray for valuable editing.

[1] 29 U.S.C. §§ 2101–2109 (2012).

[2] 29 U.S.C. § 2102(a) (“An employer shall not order a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such an order . . . .”); see §§ 2101(a)(2) and (3) for definitions of “plant closing” and “mass layoff,” respectively.

[3] 29 U.S.C. § 2101(a)(1) (emphasis added).

[4] 29 U.S.C. § 2104(a)(1).

[5] In re ContinentalAFA Dispensing Co., 403 B.R. 653, 658 (Bankr. E.D. Mo. 2009); see also In re Hanlin Grp., Inc., 176 B.R. 329, 334 (Bankr. D.N.J. 1995) (same quote); In re World Mktg. Chicago, LLC, 564 B.R. 587, 596 (Bankr. N.D. Ill. 2017) (citing ContinentalAFA, 403 B.R. at 658) (“There is little question that WARN Act claims are in the nature of severance.”).

[6] In re Cargo, Inc., 138 B.R. 923, 927 (Bankr. N.D. Iowa 1992).

[7] Hanlin, 176 B.R. at 334; see also John-Ethan Gionies, Note, The Liquidating Fiduciary: A Hidden Exception to WARN Act Liability, 31 Hofstra Lab. & Emp. L. J. 273, 285–86 (2013) (explaining the “liquidating fiduciary” exception and analyzing how it would apply in bankruptcy proceedings, but not questioning its existence).

[8] 29 U.S.C. § 2107.

[9] Worker Adjustment and Retraining Notification, 54 Fed. Reg. 16,042, 16,045 (Apr. 20, 1989) (analyzing a portion of the final rule later codified at 20 C.F.R. pt. 639.3(a)).

[10] Id.

[11] See 11 U.S.C. §§ 701–84 (2012); 11 U.S.C. §§ 1101–1174. The business may also file for chapter 12 if it is a family corporation or partnership engaged in fishing or farming. Id. § 101(19A)(B).

[12] See 11 U.S.C. §§ 701–02.

[13] The trustee may, however, operate the business for a limited period, provided that doing so is “consistent with orderly liquidation of the estate.” 11 U.S.C. § 721.

[14] See In re World Mktg. Chicago, LLC, 564 B.R. 587, 599 (Bankr. N.D. Ill. 2017) (“As such, a chapter 7 trustee is just the sort of liquidating fiduciary that is contemplated in the Department of Labor commentary.”).

[15] 11 U.S.C. §§ 1106, 1107.

[16] Id.

[17] Id. § 1104(a).

[18] Id. § 1101(1).

[19] Id. § 1107(a).

[20] Commodity Futures Trading Comm’n v. Weintrauf, 471 U.S. 343, 355 (1985) (“[I]f a debtor remains in possession—that is, if a trustee is not appointed—the debtor’s directors bear essentially the same fiduciary obligation to creditors and shareholders as would the trustee for a debtor out of possession.”).

[21] World Mktg. Chicago, 564 B.R. at 600 (“The sole function of the debtor in possession and chapter 11 trustee is not to liquidate.”).

[22] 11 U.S.C. § 1108.

[23] 54 Fed. Reg. 16,045 (1989).

[24] Compare World Mktg. Chicago, 564 B.R. at 600 (suggesting that the “liquidating fiduciary” exception should never apply in a chapter 11 case because the sole function of a debtor in possession is not to liquidate and the debtor in possession may continue to operate the business) (a prospective approach focused on the debtor’s statutory powers) with In re United Healthcare Sys., Inc., 200 F.3d 170, 178 (3d Cir. 1999) (applying the exception in a chapter 11 case because the debtor in possession demonstrated a clear intent to liquidate) (a retroactive approach focused on the debtor’s actions).

[25] See United Healthcare, 200 F.3d at 177, 179 (“It is appropriate, therefore, to consider agency regulations and comments as well as the case law. . . . In conclusion, we do not believe United Healthcare continued as an ‘employer’ within the meaning of the WARN Act when it assumed the role of fiduciary following the filing for bankruptcy. At that time, it ceased operating its business as a going concern and was simply preparing itself for liquidation.”); In re Century City Doctors Hosp., LLC, 2010 WL 6452903, at *7 (B.A.P. 9th Cir. Oct. 29, 2010) (“Given that the Ninth Circuit already has used the DOL Commentary for the same purpose, the bankruptcy court did not err when it relied on the DOL Commentary to determine whether the Trustee qualified as an employer under the WARN Act.”); World Mktg. Chicago, 564 B.R. at 599 (“The bankruptcy courts that have considered the specific question of whether a liquidating fiduciary exception to the WARN Act applies have uniformly concluded that it does. . . . In light of the foregoing, the court has little hesitation in holding that there is indeed a liquidating fiduciary exception to the WARN Act in the manner set forth in the Department of Labor commentary.”); In re Dewey & LeBoeuf LLP, 487 B.R. 169, 175 (Bankr. S.D.N.Y. 2013) (stating that “[a] liquidating fiduciary principle has developed, pursuant to which a liquidating fiduciary in a bankruptcy case does not fit the definition of an employer for purposes of the WARN Act” and continuing to apply the exception); In re MF Glob. Holdings Ltd., 481 B.R. 268, 280, 282 (Bankr. S.D.N.Y. 2012) (“[T]he Court is persuaded that the ‘liquidating fiduciary’ principle is applicable in these proceedings.”); In re Century City Doctors Hosp., LLC, 417 B.R. 801, 805 (Bankr. C.D. Cal. 2009), aff’d, 2010 WL 6452903 (B.A.P. 9th Cir. Oct. 29, 2010) (finding no WARN liability because “the trustee acted solely as a ‘liquidating fiduciary,’ rather than an employer ‘operating a business enterprise in the normal commercial sense’”); In re Jamesway Corp., 1997 WL 327105, at *12 (Bankr. S.D.N.Y. June 12, 1997) (“Thus, liquidating fiduciaries need not provide notice to terminated employees under the WARN Act.”); Hanlin, 176 B.R. at 332 (quoting the Department’s commentary and then holding that the debtor was a WARN employer because it “continued to operate the business as a whole for the benefit of all parties in interest”).

[26] See supra note 25.

[27] 176 B.R. 329 (Bankr. D.N.J. 1995).

[28] 200 F.3d 170 (3d Cir. 1999).

[29] Hanlin, 176 B.R. at 332.

[30] Id.

[31] Id. at 332.

[32] Id.

[33] Id.

[34] Id.

[35] Id.

[36] See, e.g., World Mktg. Chicago, 564 B.R. at 600 (“The Third Circuit’s United Healthcare case is th[e] leading authority on the issue.”); MF Glob. Holdings Ltd., 481 B.R. at 280 (“The United Healthcare case is particularly instructive.”).

[37] In re United Healthcare Sys., Inc., 200 F.3d 170, 172 (3d Cir. 1999).

[38] Id. at 173.

[39] Id.

[40] Id.

[41] Id.

[42] Id.

[43] Id.

[44] Id.

[45] Id.

[46] Id.

[47] Id. at 173–74.

[48] Id. at 174.

[49] Id.

[50] Id.

[51] Id.; see also 54 Fed. Reg. 16,045 (1989).

[52] United Healthcare, 200 F.3d at 174.

[53] Id. at 175.

[54] Id.; Gionies, supra note 7, at 289–90.

[55] United Healthcare, 200 F.3d at 176.

[56] Id.

[57] Id. (“‘[B]usiness enterprise’ [is] a term the statute does not define.”).

[58] Id.

[59] Id. (emphasis added).

[60] Id. at 176–77 (“Addressing the facts here in context, we do not believe WARN’s plain language resolves whether United Healthcare was an ‘employer’ required to provide sixty days notice prior to its termination of the 1,200 employees.”).

[61] Id. at 177 (“It is appropriate, therefore, to consider agency regulations and comments as well as the case law.”).

[62] Id. at 179 (“[W]e do not believe United Healthcare continued as an ‘employer’ within the meaning of the WARN Act when it assumed the role of fiduciary following the filing for bankruptcy. At that time, it ceased operating its business as a going concern and was simply preparing itself for liquidation.”).

[63] Id.

[64] Id.

[65] Infra Part II.

[66] Id.

[67] Id.

[68] In re Hanlin Grp., Inc., 176 B.R. 329, 332 (Bankr. D.N.J. 1995)

[69] United Healthcare, 200 F.3d at 179.

[70] Id. at 177.

[71] See supra note 25.

[72] 29 U.S.C. § 2101(a)(1) (2012) (emphasis added).

[73] See Gen. Dynamics Land Sys., Inc. v. Cline, 540 U.S. 581, 600 (2004) (looking at the “text, structure, purpose, and history” of a statute to interpret its meaning); see also Sir William Blackstone, 1 Commentaries on the Laws of England 58–61 (Cooley ed. 1876) (1765-69) (“The fairest and most rational method to interpret the will of the legislator is by exploring his intentions at the time when the law was made, by Signs the most natural and probable. And these signs are either the words, the context, the subject-matter, the effects and consequence, or the spirit and reason of the law.”).

[74] See, e.g., Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002) (“As in all statutory construction cases, we begin with the language of the statute.”).

[75] United Healthcare, 200 F.3d at 176 (“‘[B]usiness enterprise’ [is] a term the statute does not define.”).

[76] See Lopez v. Gonzales, 549 U.S. 47, 53 (2006) (“The everyday understanding of [the word at issue] should count for a lot here, for the statutes in play do not define the term, and so remit us to regular usage to see what Congress probably meant.”) (emphasis added).

[77] For example, Merriam-Webster defines “enterprise” as “a unit of economic organization or activity; especially a business organization.” Enterprise, Merriam-Webster Dictionary (2018), https://www.merriam-webster.com/dictionary/enterprise [https://perma.cc/9XMP-QQ5M]. In a similar manner, Black’s Law Dictionary defines “business enterprise” as “a for-profit company, business, or organization that provides financial, commercial, or industrial goods and services.” Business Enterprise, Black’s Law Dictionary (10th ed. 2014). A business being liquidated still provides goods and services—just not for much longer. For example, when retailers (such as Toys R Us) liquidate under chapter 7, they continue to sell any remaining inventory. See Joan Verdon & Nathan Bomey, How Chapter 7 Liquidation Works: Toys R Us Preps Going-Out-of-Business Sales, USA Today (Mar. 9, 2018), https://www.usatoday.com/story/money/2018/03/09/chapter-7-bankruptcy-liquidation/409239002/ [https://perma.cc/XHR9-LLQP].

[78] See Brett M. Kavanaugh, Fixing Statutory Interpretation, 129 Harv. L. Rev. 2118, 2161–62 (2016) (“Judges say that we should not interpret statutes to be redundant. But humans speak redundantly all the time, and it turns out that Congress may do so as well. Congress might do so inadvertently. Or Congress might do so intentionally in order to, in Shakespeare’s words, make ‘double sure.’”).

[79] See W. Virginia Univ. Hosps., Inc. v. Casey, 499 U.S. 83, 88–89 (1991) (looking at the “record of statutory usage” across various titles of the United States Code to determine that expert fees are not included in “attorney’s fees”).

[80] 15 U.S.C. § 1221(a) (2012).

[81] 15 U.S.C. § 7108(7) (2012).

[82] 22 U.S.C. § 3102(6) (2012).

[83] 28 U.S.C. § 1452(d)(2) (2012).

[84] 42 U.S.C. § 6705(f)(2) (2012).

[85] 42 U.S.C. § 7141(f) (2012).

[86] United States v. Scavo, 593 F.2d 837, 842–43 (8th Cir. 1979).

[87] Id. at 843.

[88] See In re United Healthcare Sys., 200 F.3d 170, 176 (3d Cir. 1999) (employees had “various tasks all related to shutting down . . . operations”) (emphasis added); see also In re Fairfield Sentry Ltd., 714 F.3d 127, 137 (2d Cir. 2013) (holding that a debtor’s “liquidation activities and administrative functions” may be considered to determine the debtor’s center of main interests for purposes of a chapter 15 cross-border bankruptcy) (emphasis added).

[89] 593 F.2d 837 (8th Cir. 1979).

[90] Id. at 842–43 (emphasis added).

[91] 54 Fed. Reg. 16,045 (1989).

[92] 200 F.3d at 176.

[93] 29 U.S.C. § 2101(a)(1) (2012) (emphasis added).

[94] See Victoria Nourse, Two Kinds of Plain Meaning, 76 Brook. L. Rev. 997, 1000 (2011) (“As linguist Larry Solan has written, ordinary meaning is prototypical meaning—that is, meaning focusing on a core example, rather than reaching the conceptual or logical extension of the term. Prototypical meaning picks the best example, not the peripheral one.”) (emphasis added).

[95] Id.

[96] Dep’t of Hous. & Urban Dev. v. Rucker, 535 U.S. 125, 131 (2002) (quoting United States v. Gonzales, 520 U.S. 1, 5 (1997)).

[97] Supra Part II, Section I.

[98] 29 U.S.C. § 2101(a)(1) (emphasis added).

[99] Rucker, 535 U.S. at 131.

[100] United States v. Johnson, 529 U.S. 53, 58 (2000).

[101] N.L.R.B. v. SW Gen., Inc., 137 S. Ct. 929, 940 (2017) (quotations omitted) (citing Chevron v. Echazabal, 536 U.S. 73, 80 (2002) (quoting United States v. Vonn, 535 U.S. 55, 65 (2002))).

[102] 29 U.S.C. § 2102(b)(1).

[103] Id. § 2102(b)(2)(A).

[104] Id. § 2102(b)(2)(B).

[105] United States v. Vonn, 535 U.S. 55, 65 (2002) (citing Pauley v. Beth Energy Mines, Inc., 501 U.S. 680, 703 (1991)).

[106] Burns v. United States, 501 U.S. 129, 136 (1991).

[107] H.R. Rep. No. 100-576, at 1046 (1988) (Conf. Rep.).

[108] Omnibus Trade and Competitiveness Act of 1987, H.R. 3, 100th Cong. (1987).

[109] H.R. Rep. No. 100-576, at 1 (1988) (Conf. Rep.).

[110] H.R. Rep. No. 100-576, at 1045 (1988) (Conf. Rep.) (“The House bill contains no comparable provision” to the section “Advance Notification of Plant Closings and Mass Layoffs[.]”).

[111] Omnibus Trade and Competitiveness Act of 1987, S. 1420, 100th Cong. (1987).

[112] Id. at 609.

[113] Id.

[114] 29 U.S.C. § 2101(a)(1) (2012).

[115] H.R. Rep. No. 100-576 (1988) (Conf. Rep.).

[116] Auburn Hous. Auth. v. Martinez, 277 F.3d 138, 147 (2d Cir. 2002).

[117] H.R. Rep. No. 100-576, at 1046 (1988) (Conf. Rep.).

[118] Id.

[119] See Actions Overview of H.R. 3 – 100th Congress (1987-1988), Congress.gov, https://www.congress.gov/bill/100th-congress/house-bill/3/actions?q=%7B%22search%22%3A%5B%22hr3%22%5D%7D&r=1616) [https://perma.cc/PYH4-6M59].

[120] Worker Adjustment and Retraining Notification Act, S. 2527, 100th Cong. § 2(a)(1) (1988).

[121] Id. § 2(a).

[122] Worker Adjustment and Retraining Notification Act, S. 2527, Roll Vote Nos. 225, 229.

[123] Worker Adjustment and Retraining Notification Act, Pub. L. No. 100-379, § 102 Stat. 890 (1988).

[124] Dolan v. U.S. Postal Serv., 546 U.S. 481, 486 (2006) (“Interpretation of a word or phrase depends upon reading the whole statutory text, considering the purpose and context of the statute, and consulting any precedents or authorities that inform the analysis.”) (emphasis added); McCreary Cty., Ky. v. Am. Civil Liberties Union of Ky., 545 U.S. 844, 861 (2005) (“Examination of purpose is a staple of statutory interpretation that makes up the daily fare of every appellate court in the country.”) (emphasis added).

[125] In re APA Transp. Corp. Consol. Litig., 541 F.3d 233, 239 (3d Cir. 2008), (“The purpose of the WARN Act is to protect workers by obligating employers to give their employees advanced notice of plant closings.”); Bader v. N. Line Layers, Inc., 503 F.3d 813, 817 (9th Cir. 2007) (“The purpose of the Act is to give advance notice to workers and the community so that workers can prepare to seek alternative employment and communities can prepare for the economic disruption of a mass layoff.”).

[126] Bader, 503 F.3d at 817.

[127] Gionies, supra note 7, at 285 (“But now, in light of United Healthcare and Jamesway, it is possible that employers, under certain circumstances, might be wise to instead delay their layoffs or plant closings until after filing a petition in bankruptcy in hopes of completely relieving themselves of WARN Act liability by qualifying as liquidating fiduciaries instead of business enterprises.”).

[128] See In re Hanlin Grp., Inc., 176 B.R. 329, 334 (Bankr. D.N.J. 1995).

[129] 29 U.S.C. § 2104(a)(1) (2012).

[130]11 U.S.C. § 541 (2012) (defining the estate to include “all legal or equitable interests of the debtor in property as of the commencement of [a] case”).

[131] Solberg v. Inline Corp., 740 F.Supp. 680, 685 (D. Minn. 1990) (citing Belland v. Pension Benefit Guar. Corp., 726 F.2d 839, 844 (D.C. Cir. 1984)).

[132] Snider v. Commercial Fin. Servs., Inc., 288 B.R. 890, 895 (N.D. Okla. 2002) (citing Carpenters District Council of New Orleans & Vicinity v. Dillard Dept. Stores, Inc., 15 F.3d 1275, 1282 (5th Cir. 1994)) (“Exceptions to the sixty day notice requirement are to be narrowly construed and the employer has the burden to prove the exception applies.”).

[133] See Hale Melnick, Note, Guidance Documents and Rules: Increasing Executive Accountability in the Regulatory World, 44 B.C. Envtl. Aff. L. Rev. 357, 373–75 (2017).

[134] Kent Barnett & Christopher J. Walker, Chevron Step Two’s Domain, 93 Notre Dame L. Rev. 1441, 1441 (2018) (“An increasing number of judges, policymakers, and scholars have advocated eliminating or narrowing Chevron deference . . . .”); see generally Christopher J. Walker, Attacking Auer and Chevron Deference: A Literature Review, 16 Geo. J.L. & Pub. Pol’y 103 (2017).

[135] Pereira v. Sessions, 138 S.Ct. 2105, 2129 (2018) (Alito, J., dissenting) (“[U]nless the Court has overruled Chevron in a secret decision that has somehow escaped my attention, it remains good law.”).

[136] Chevron v. Natural Resources Defense Council, 467 U.S. 837, 842–43 (“If the intent of Congress is clear, that is the end of the matter; . . . [but] if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.”).

[137] Melnick, supra note 133, at 373.

[138] Id. at 378 (“The Court in Barnhart announced that Chevron deference does not apply only to rules promulgated through notice-and-comment rulemaking.”) (citing Barnhart v. Walton, 535 U.S. 212, 221–22 (2002)).

[139] Id.).

[140] 467 U.S. at 843 n.9; see also Gen. Dynamics Land Sys., Inc. v. Cline, 540 U.S. 581, 600 (2004) (“Even for an agency able to claim all the authority possible under Chevron, deference to its statutory interpretation is called for only when the devices of judicial construction have been tried and found to yield no clear sense of congressional intent.”).

[141] Supra Part II.

[142] 467 U.S. at 842 (“If the intent of Congress is clear, that is the end of the matter . . . .”).

[143] Id.

[144] Melnick, supra note 133, at 375.

[145] Id.

[146] Id.; Skidmore v. Swift, 323 U.S. 134, 140 (1944).

[147] 29 U.S.C. § 2101(a)(1) (2012) (emphasis added).

It is All About the Money: Presidential Conflicts of Interest

By Samantha Block[*]

The 2016 presidential election marked an increased distrust in the government, bringing a new era of presidential and vice presidential candidates. Current conflict of interest laws do not extend to the President and Vice President due to an outdated fear of interfering with their Article II constitutional powers. While conflicts of interest are not unique to the 21st century, the 2016 election brought about unprecedented conflicts. The 2016 election was unique—President Donald Trump was the first President in decades to refuse to remove notions of financial conflicts of interest. Trump’s acquisitions abroad have led to accusations of bias and bribery along with the fear that U.S. foreign policy will be influenced by his self-interest. Trump touted his conflicts making it clear that current laws are ineffective and outdated. This Article proffers that conflict of interest laws need to extend to the President and Vice President. First, this Article will explain why presidential conflicts of interest were previously not explicitly outlawed. This Article will then discuss current conflicts of interest laws and tools for managing these conflicts. This Article proposes a new law that would apply to presidential and vice presidential candidates which would require them to create a qualified blind trust. Additionally, this Article will explain why the Office of Government Ethics should be charged with overseeing the enforcement of this regulation.

 

Table of Contents

Introduction

I. The Current Legal Landscape: What are Conflicts of Interest, Who is “Conflicted,” and the “Three-D” Method of Conflict of Interest Regulation

A.  Disclosure

B. Disqualification

C. Divestiture

II. The Election Evolution: An Evolution (Crisis) of Trust

A. The Millionaire’s Club: Why President and Vice President’s Conflicts of Interest Require Immediate Attention

B. The “Huge” Problem with Current Regulation of Conflicts of Interest

C. Emoluments Clause

III. The Proposal: Giving OGE Real Power to Prevent Conflicts of Interest Before a Candidate Takes Office

A. Public Service is Public Trust: How OGE Can Combat Conflicts of Interest

B. The Proposal: Candidate Commitment to Eliminating Financial Conflicts

i. Illustration: Proposed OGE Regulation in Action

C. Counter Argument: Takings Claim

D. Why the Proposed Statute is More Efficient Than the Alternatives

i. Constitutional Amendment

ii. Congress Takes Charge

iii. The Executive Investigates

Conclusion

 

Introduction

Alexander Hamilton explained in Federalist Paper No. 68 that one of the “most deadly adversaries of [a] republican government. . . [is] the desire in foreign powers to gain an improper ascendant to our councils.”[1] The 2016 presidential election has brought about a new era of more complex conflicts of interest which make it harder to prevent foreign influence over U.S. government officials.[2] President Donald Trump illustrates this shift in conflicts of interest—he is currently the sole owner or partner of around 500 business entities which are located in over 20 countries, creating concern about the nation’s susceptibility to foreign exploitation.[3]

Conflict of interest laws are necessary to prevent government officials, including the President and Vice President, from engaging in activities that could impair their ability to properly carry out the requirements of their position.[4] Historically, Congress has had difficulty drafting conflicts of interest laws while also avoiding separation of powers issues.[5] Yet the ongoing and fervent debate regarding gun control far outpaces its drunk driving equivalent. Congress attempted to address the problem of conflicts of interest by enacting various statutes [6] aimed at “prohibit[ing] government officials from engaging in conduct that might be inimical to the best interests of the general public.”[7]

But Congress is not the only entity concerned about conflicts of interest. Even Presidents have understood the danger personal financial interests can pose. For example, President Lyndon B. Johnson — who was accused of using his political influence to garner profits for his wife’s broadcasting company — recognized that conflicts of interest laws needed to extend to executive employees – and set forth “standards of ethical conduct” for executive employees in Executive Order 11,222.[8] Unfortunately, both Congress and President Johnson’s efforts failed to extend the applicability of those requirements to the President and Vice President.[9] In the words of the 45th President, Donald Trump, this is a huge problem.

The 2016 election brought to the forefront the issue of conflicts of interest and the lack of regulation in this area of the law as it applies to the President. Past presidential elections have demonstrated that some conflicts of interest are inevitable, as Presidents and Vice Presidents are no longer only career politicians, but also entrepreneurs and investors with complex portfolios. This Article will explain the need for a federal conflict of interest law that applies to the President and Vice President and illustrate why the Office of Government Ethics (“OGE”) should be charged with enforcing a condition precedent for candidates, requiring them to agree to create a blind trust. Part I will discuss the current legal landscape pertaining to federal conflicts of interest law and the three methods typically implemented to avoid these conflicts: disclosure, disqualification, and divestiture. Part II will examine the existing federal conflicts of interest regulations and explain why they do not apply to the President and Vice President. In addition, Part II will assess the potential separation of powers issues presented when expanding these regulations to the President and Vice President. Part III will discuss why a condition precedent for presidential and vice presidential candidates, regulated by OGE, is the best solution to prevent executive conflicts of interest.

I. The Current Legal Landscape: What are Conflicts of Interest, Who is “Conflicted,” and the “Three-D” Method of Conflict of Interest Regulation

Conflicts of interest have the potential to influence executive actions. As James Madison stated, “[n]o man is allowed to be a judge in his own case, because his interest would certainly bias his judgment, and not improbably, corrupt his integrity.”[10] A conflict of interest exists whenever an “officer or employee of the executive branch[‘s]. . . decision, approval, disapproval, recommendation, the rendering of advice, [or] investigation” will affect his financial interests.[11] Conflicts of interest are concerning because they create a fear in citizens that the “loyalty to private economic and business interests, rather than fealty to the general public interest, is being served by such officials in their actions.” [12]

During the Civil War, Congress restricted potential presidential conflicts of interest by enacting a financial conflict statute—however, it was eventually amended to exempt the President to avoid any impression that Congress was overstepping its constitutional powers.[13] In 1965, President Lyndon B. Johnson issued Executive Order 11,222 which created ethical standards of conduct for executive branch employees.[14] According to President Johnson, this Order was important because “[w]hen government is based on the consent of the governed, every citizen is entitled to have complete confidence in the integrity of his government.”[15] Part two of the order prohibits employees from “solicit[ing] or accept[ing], directly or indirectly, any gift, gratuity, favor, entertainment, loan or any other thing of monetary value” from a party who has an interest in the employee’s actions.[16] Part four requires certain executive office and agency employees to disclose their financial statements.[17]

The executive is not the only branch that has recognized the need for regulations that address conflicts of interest—Congress has also passed legislation concerning these financial interests. In the aftermath of Nixon’s Watergate scandal, in 1978 Congress passed the Ethics in Government Act (“Ethics Act”)[18] which sought to “increase public confidence in the government.”[19] The purpose of the Ethics Act was to provide the public with information regarding potential conflicts of interest and raise awareness of the economic interests of candidates that may influence their decision-making.[20] Additionally, the Ethics Act created OGE, an independent agency, to oversee the ethics requirements for the executive branch.[21]

Currently, the laws regarding conflicts of interest only extend to certain executive branch employees. [22] These laws center around the notion “that a public servant owes undivided loyalty to the Government” and seek to prevent any intentional or unintentional influence arising from private or personal financial interests.[23]The current federal conflict of interest laws can go so far as to require employees to divest assets or recuse themselves from certain issues.[24] Yet these laws fail to extend to the President and Vice President for fear of “interfer[ing] with their ability to carry out their diverse responsibilities under the Constitution.”[25]

While these laws do not extend to the President, many Presidents voluntarily comply and generally utilize one of three different courses of action. These commonly implemented methods are typically referred to as the “three-D” method: “disclosure, disqualification, and divestiture.”[26]

A. Disclosure

Disclosure informs the public of any potential conflicts, but only goes so far in removing conflicts of interest. Congress believed that mandatory disclosure laws would help increase confidence in the government and remedy the low voter turnout that resulted from the Watergate scandal.[27] To rectify this increased distrust, Congress implemented public financial disclosure laws “aimed at prohibiting conflicts of interest and requiring disclosure of gifts, contributions, personal income, and net worth.”[28] These early conflict of interest laws, which were interpreted to exclude the President, sought to “demonstrate the high level of integrity of the vast majority of government officials.”[29] The interpretations were in part based on Congress’s 1989 amendment to the federal conflict of interest statute to explain that the “terms ‘officer’ and ‘employee’ shall not include the President [and] the Vice President.”[30] However, even before the amendment expressly excluded the President and Vice President, the DOJ believed that conflicts of interest statutes did not apply to the President because it would “disempower him from performing some of the functions prescribed [in] the Constitution.”[31]

Despite their exemption, the majority of Presidents and Vice Presidents continued to voluntarily disclose their financial interests, to avoid any perceived or actual conflicts of interest.[32] Although there are no laws compelling a President to rid himself of a conflict, federal ethics laws do require the President to disclose certain potential conflicts of interest.[33] One such law is the above mentioned Ethics Act which requires the President and Vice President “to disclose personal assets, investments, interests, and income upon entering office and on an annual basis thereafter.”[34]

To serve as President is to sacrifice self-interest for the “public good.”[35] The congressional committee recognized two potential “deterrent factor[s]” mandatory public disclosure could create: it could both deter maintaining certain assets and also dissuade some individuals from seeking office.[36] The disclosure laws are meant to ensure that an official’s personal ventures are subject to public scrutiny by providing citizens the opportunity to evaluate the potential impact these investments could have on their decision-making.[37] Disclosure, however, does not instruct an official on the handling of his personal ventures.[38] Due to the nature of a mechanism such as disclosure, it may lead to public awareness of a conflict of interest but, without more, disclosure cannot force a candidate to rectify the problem.[39] Rather, disclosure merely allows “steps to be taken to determine what measures are needed to resolve or manage the conflict.”[40]

B. Disqualification

When an elected official utilizes only disclosure, a conflict of interest may still arise, thus resulting in the official’s required recusal from certain responsibilities. Currently, federal ethics laws prohibit officials from personally participating in matters which the official personally, a member of the official’s family, or an organization connected to the official is involved.[41] Additionally, these laws require those with a substantial financial stake in a matter to recuse themselves.[42] These laws, however, extend only to current or existing financial interest, not past affiliations; thus, an official will not typically be prevented from participating in matters relating to previous affiliations and economic interest.[43] It should also be noted that the statutory provision requiring disqualification and recusal from certain matters is a criminal provision.[44]

A federal official not wishing to or unable to recuse himself may request a waiver permitting him to work on the matter.[45] Most waiver requests are granted because the conflicts are classified as “immaterial or unlikely.”[46]

The financial conflict of interest laws requiring recusal apply to all officers and employees in the executive branch and independent agencies, but expressly exclude the President and Vice President.[47] Even before the specific statutory exemption, Congress interpreted the disqualification law not to extend to the President and Vice President.[48] Legislation requiring recusal clearly has more of an ability to prevent conflicts of interest, but unlike disclosure, which Presidents and Vice Presidents have chosen to comply with, recusal has not been voluntarily used.

C. Divestiture

The most effective mechanism to avoid conflicts of interest, but most draconian of the “three-Ds,” is divestiture. To avoid disqualification, a public official can avoid conflicts of interest by divesting any financial interests that may potentially necessitate recusal.[49] There is no federal statute requiring federal employees to divest particular private assets due to potential conflicts of interest.[50] Some government employees choose to divest their assets to avoid conflicts of interest.[51] For example, during the Obama Administration, Deputy Secretary of Defense appointee William J. Lynn, former lobbyist and Senior Vice President of defense contractor Raytheon, agreed to sell his restricted stock in the company, as a condition of his appointment.[52] By divesting these assets, Lynn was able to remove any impression of a conflict of interest while working at the Pentagon, where his responsibilities include creating defense contracts.[53]

There are numerous ways to divest an asset, the most “obvious” being to sell any potentially problematic financial interests.[54] An alternative to complete divestiture is for an official to create a qualified blind trust. A qualified blind trust is a trust that adheres to the regulations set forth in the Ethics Act.[55] The Act requires a qualified blind trust to be approved by OGE prior to its execution.[56] The trust is “blind” because the official transfers his asset to the trust, which is managed by an independent trustee, without the official’s participation or knowledge.[57] An independent trustee “cannot be affiliated with, associated with, related to, or subject to the control or influence of anyone who has a beneficial interest in the [blind trust].”[58] The trustee may sell the original assets and acquire new ones, but the official is unaware of how the assets are being managed.[59] The independent trustee is charged with managing the assets and is restricted from relaying information about the assets to the official, outside of the “most basic information.”[60] This information is usually limited to the taxable income and total fair market value, additional disclosures are limited to requests for cash to assist with living expenses.[61]

Blind trusts are a good solution for candidates with complicated portfolios that cannot be easily liquidated or for those who do not want to convert their asset into a treasury note or mutual fund.[62] As a conflict avoidance measure, a blind trust strikes a balance between ensuring that a policymaker’s own financial investments do not influence their decision-making while not dissuading qualified individuals from running for office.[63] While no federal law requires employees to place assets into a blind trust upon taking office, it is a common practice among high-ranking officials.[64] This is because blind trusts enable a politician to avoid the appearance of conflicts of interest between personal financial interests and that of the public’s interest without completely divesting all of their assets.[65] Establishing a blind trust can also help ease the burdens of disclosing financial interests because an official only needs to include the overall value of the trust and the assets originally transferred.[66] Additionally, many Presidents utilize blind trusts because of the difficulty in either recusing themselves or obtaining waivers for all of their duties.[67]

However, a blind trust is not an absolute protection against suspicion. Even after creating a blind trust, officials may still be subject to scrutiny over their investments. For example, in 2005, Bill Frist, then-U.S. Senate Majority Leader, had his trustee sell shares of a hospital company his father and brother founded, just days before the stock reported decreased earnings.[68] Although the Securities and Exchange Commission did not charge Frist, the media scrutiny he received likely contributed to his decision not to seek reelection or pursue a presidential bid.[69]

This is not to say that a blind trust is not a useful tool to combat conflicts of interest. A blind trust helps foster public confidence in governmental decision-making by preventing the official from knowing which companies he owns thereby removing biased policymaking.[70] Blind trusts are easily regulated—the Ethics Act sets out specific requirements for a “qualified blind trusts”[71] —and allow an official to avoid complete divestiture. This Article argues that complete divestiture is not needed to avoid conflicts of interest and, rather than reinventing the wheel, the Ethics Act’s requirements for qualified blind trusts should be used in a statute that applies to the President and Vice President.[72]

II. The Election Evolution: An Evolution (Crisis) of Trust

A President’s income is typically related to the economy, consequently, President’s financial ventures have changed as the dominant industries have shifted.[73] In the beginning of the republic, slavery was often defended as an “economic necessity.” In fact, several early Presidents owned slaves. Presidents who had slaves often faced higher scrutiny, particularly from the North.[74] Recently, historians have focused on one such President—Thomas Jefferson. Jefferson took a contradictory approach to slavery, which some scholars opine was a result of his personal interests influencing his policies.[75] By 1850 most Presidents were middle-class lawyers who had previously spent a significant part of their career in public service and a majority of whose financial interests were in personal real estate and easily liquidated assets.[76] The likelihood that their wealth would affect their domestic and foreign policies was highly unlikely. From the end of the nineteenth century to the early twentieth century, the economy shifted to “professionally organized corporations”—mining, oil, railroad, and financial sectors were the high grossing sectors.[77] During this period, a significant portion of a President’s wealth was amassed from inheritance, which was also unlikely to be affected by executive actions.[78]

Today, conflicts of interest occupy a place of anxiety in the public consciousness—gone are the days of veteran public servants; now Presidents are also business moguls.[79] As these conflicts have become more publicized, the public’s trust in the government has decreased. Even the Supreme Court has recognized the importance of creating a conflicts of interest standard, explaining that “a democracy is effective only if the people have faith in those who govern, and the faith is bound to be shattered when high officials . . . engage in activities which arouse suspicions of malfeasance and corruption.”[80] There are several reasons for the growing mistrust of the government, such as the increased regulation and bail-outs to the growing “sea of money pumped into political campaigns” which allows interest groups to have direct access to public officials.[81] This direct access at the candidate stage coupled with the lack of regulations or constitutional provisions extending to presidential conflicts of interest, have led to many individuals accusing the President of improper decision-making.[82]

A. The Millionaire’s Club: Why Presidential and Vice Presidential Conflicts of Interest Require Immediate Attention

The 2016 election is not the first time that concerns arose about the President and Vice President’s potential conflicts of interest. Past presidential candidates, such as 2012 Republican candidate Mitt Romney, faced numerous potential conflicts of interest.[83] These potential conflicts ranged from his prior management of Bain Capital—a private equity firm that invested in U.S. companies—to his refusal to disclose all of his investments.[84] Romney tried to combat these concerns by touting his “blind” trust; however, this trust was controlled by his longtime friend and personal lawyer. [85] Presidents are not alone in facing conflicts of interest. Vice Presidents, such as Nelson Rockefeller and Dick Cheney, also have confronted a multitude of potential conflicts.[86] For example, Rockefeller served on the board of directors for numerous companies who received government contracts while he was in office.[87] During the 1974 confirmation hearings on Rockefeller’s nomination for Vice President,[88] the Senate failed to agree on the necessary extent of disclosure and which of Rockefeller’s financial ties would lead to conflicts.[89] Four months after Rockefeller’s nomination for Vice President—twice the length of time it took for Gerald R. Ford’s presidential nomination process to be completed—Rockefeller finally received his confirmation for Vice President.[90]

Similarly, in 2001 Dick Cheney made headlines for his conflicts of interest during the Iraq war. While Cheney was Vice President, the military contractor Halliburton, where Cheney was the past chief executive, rose from the twenty-second largest to the seventh largest military contractor.[91] In 2001, Halliburton won a contract worth as much as $7 billion to provide support to the military troops in the Middle East.[92] The company continued to receive Iraq-related contracts without any bidding[93] from competing firms, totaling $39.5 billion.[94] Responding to the public outcry concerning Cheney’s actions while Vice President, in April 2007, United States Representative Dennis Kucinich filed an impeachment resolution against Cheney.[95] In this resolution Kucinich accused Cheney of “purposely manipulat[ing] the intelligence process” and threatening Iran with force when no real danger existed.[96] Cheney’s potential impeachment illustrates that as global markets become increasingly interconnected, voters have focused more on where and from whom government officials get their money.

The 2016 election saw a shift in how candidates confronted their conflicts of interest. Rather than attempting to avoid conflicts, then-candidate Trump embraced his. Trump admitted that his policy decisions currently are and would continue to be affected by his business ventures.[97] When addressing a recent lease for his hotel business, the federally-owned Old Post Office Pavilion in Washington, D.C., Trump admitted “I have a conflict of interest because I am building the greatest . . . building at the old post office I think what will be maybe one of the great hotels in the world.”[98]

To quell fears regarding his conflicts of interest, Trump stated that he would put the Trump Organization into a blind trust controlled by his two eldest sons and “take other steps” to remove suspicion of any conflicts of interest, but refused to sell his assets.[99] Despite this promise to remove any conflicts, Trump maintained that his children would not only remain a part of the company, but they would also be involved in vetting cabinet candidates.[100] While Trump claims he will “not talk about business” with his sons, it is impossible to ensure he adheres to this promise.[101] Trump’s children running his company is a minor conflict compared to the fear of foreign nationals influencing the President.[102] The Trump Organization has numerous overseas partners including an Azerbaijani billionaire, whose father has been identified by American intelligence as a money launderer for the Iranian military, raising ethical concerns for Trump who campaigned as a staunch adversary of the Iranian regime.[103]

In the 2016 election, the democratic candidate, Hillary Clinton, also faced scrutiny for her potential conflicts of interest, mainly the Clinton Foundation’s foreign donors. Unlike Trump’s assets, the Clinton Foundation does not have investors, but rather donors, making divestiture an unlikely solution. To avoid an appearance of a conflict, Bill Clinton said he would leave the board, cease raising funds, the organization would no longer accept foreign donations, and the name would be changed from the Bill, Hillary & Chelsea Clinton Foundation to the Clinton Foundation.[104]

Hillary Clinton’s actions while Secretary of State were also highly scrutinized during the campaign and even after the election. In 2010, while Clinton was secretary of state, the State Department signed off on a deal for the purchase of Uranium One by Rosatom, Russia’s nuclear energy agency.[105] Critics were skeptical of Clinton’s motives as several of Uranium One’s owners were also donors to the Clinton Foundation. In 2017, the Department of Justice investigated the Clinton Foundation after allegations resurfaced that the Clinton approved this deal in exchange for donations to the Clinton Foundation. [106]
Political ideologies aside, the 2016 election demonstrates that presidential conflicts of interest should be a matter of public concern and the gap in current legislation extending to the President needs to finally be addressed by Congress.[107]

B. The “Huge” Problem with Current Regulation of Conflicts of Interest

Congress enacted 18 U.S.C. § 208 to prohibit executive branch and agency employees from “personally and substantially” participating in a matter “in which, to his knowledge, he, his spouse, minor child, general partner, organization in which he is serving as officer” has a financial interest.[108] Section 208 was created “to insure honesty in the government’s business dealings by preventing federal agents who have interests adverse to those of the Government from advancing their own interest at the expense of public welfare.”[109]

Under section 208 a “financial interest exists on the part of a party to a section 208 action where there is a real possibility of gain or loss because of developments in or resolution of a matter.”[110] A financial interest includes negotiations with private sector entities for future employment.[111] Section 208 does not require that the Government suffer actual loss or that there be actual corruption because of the employee’s conflict of interest.[112]

As it currently stands, Section 208 specifically exempts the President and Vice President.[113] The rationale is that most of the decisions required of the President will lead to advantages for some and disadvantages for others, making it almost impossible to regulate every action taken by him.[114] In particular, the drafters feared that section 208, which imposes federal criminal penalties, would interfere with a President’s ability to carry out the constitutional requirements of the position, such as prohibiting the President from signing certain legislation.[115] Therefore, to avoid tying the “single most consequential decision maker on the planet[’s]” hands because of conflicts of interest over potential financial gain, Congress did not extend section 208 to the President.[116] Congress reasoned that because of the “uniqueness” of the President’s situation they “must inevitably be treated separately from the rest of the executive branch . . . [because] disqualification of the President from policy decisions because of personal conflicting interests [would be] inconceivable.”[117] The framers of the Constitution also recognized the danger of conflicts of interest and advocated for mechanisms that cabin the effects of conflicts rather than requiring officials to completely remove any self-interest.[118]

Congress can arguably create federal conflicts of interest law that apply to the President, just as they had prior to the 1989 ethics legislation reform.[119] The Supreme Court has explained the importance of Congress’s ability to “adopt a statute whose breadth would be sufficient to cope with the evil [of conflicts of interest].”[120] When extending these laws to the President, Congress must still be careful to avoid confrontations between the executive branch and itself.[121] The framers assigned different powers to the legislative, executive, and judicial branches, but, in doing so, they rejected the “pure doctrine”[122]of separation of powers.[123] Instead, the framers implemented a system of checks and balances, giving each branch the ability to control certain aspects of the other. Expanding section 208 would not be a check, however, because a forced recusal would impede the President’s Article II constitutionally required powers.

Some commentators argue that expanding section 208 would impede the President’s ability to fulfill his Article II requirements, creating a separation of powers issue.[124] Subjecting the President to section 208 will potentially conflict him out of giving certain executive actions, thereby interfering with his constitutional duties.[125] Arguably expanding section 208 also unlawfully adds supplemental requirements to the qualifications for being president.[126] This could be perceived as Congress overstepping its authority by disqualifying individuals with conflicts of interest, a violation of the separation of powers principle.[127]

C. Emoluments Clause

A broader potential limitation on conflicts of interest is the Emoluments Clause.[128] On its face, the Constitution does not provide parameters for conflicts of interest presented by the President.[129] The only arguable limitation on these types of conflicts of interest would be the Emoluments Clause[130] of the Constitution, allowing Congress to police the executive branch.[131] The Emoluments Clause—“essentially an anti-bribery rule”—prevents members of the federal government from accepting gifts and payments from foreign nations without congressional approval.[132] Under this Clause Congress has the explicit power to regulate what things of value[133] the President can accept from foreign officials.[134] The Emoluments Clause permits Congress to create ethical standards that apply to various government officials, including the President and Vice President, making it a potential basis for congressional action.[135] The Emoluments Clause seeks to prevent foreign officials from influencing the President by giving Congress the power to create a standard of acceptable conduct.[136] The founders created this clause because they recognized that “[c]orruption, in the American tradition, does not just include blatant bribes and theft from the public till, but encompasses many situations where politicians and public intuitions serve private interests at the public’s expense.”[137]

It is ambiguous whether the founders intended for the Emoluments Clause to extend to the President. Little judicial precedent exists regarding the Emoluments Clause, making its scope unknown.[138] Although some argue that the Emoluments Clause was not meant to extend to the President, past presidential actions illustrate the contrary.[139] In fact “[e]very President in the past four decades[140] has taken personal holdings he had before being elected and put them in a blind trust” or an equivalent.[141] This was done to avoid conflicts, including those barred by the Emoluments Clause.[142]

Some scholars argue that the Emoluments Clause does not apply to the President.[143] Professor Seth Barrett Tillman[144] argues that the Emoluments Clause does not extend to the President and uses George Washington to support this assertion. Tillman notes that Washington accepted two gifts—a key to a Bastille and a portrait of King Louis XVI—from French officials without congressional approval.[145] However, Tillman fails to account for the fact that both gifts were given by former Washington aides, making it plausible that Washington considered these personal gifts.[146] Notably, until President Trump, the Emoluments Clause received little attention.[147] Consequently, there is a lack of judicial precedent interpreting the scope of the Clause. These consistent past actions by Presidents should not go unnoticed. Just as the Supreme Court, when dealing with national security issues, looks at past practices to determine the limits of presidential power, here Presidents’ past compliance creates a compelling argument for the Emoluments Clause’s extension to the President and Vice President.[148]

Some scholars argue that if Washington did not have to follow the Emolument Clause, the framers did not intend it to apply to the President.[149] Yet the Emoluments Clause specifically states that it applies to “any Office of Profit or Trust [under the United States]” making it improbable that it was not meant to extend to the President.[150] An argument could be made that extending the Emoluments Clause to the President and Vice President would be a violation of the separation of powers principle by creating additional qualifications for office.[151] The Emoluments Clause’s anti-corruption purpose, however, reaches the President as much as any other official, and since its strong language does not clearly exempt the President, Congress probably has the ability to regulate Presidential conflicts of interest.[152] There is also uncertainty as to whether anyone has legal standing to bring a claim under the Emoluments Clause.[153]

Even if the Emoluments Clause applied to the President and Vice President, it would not extend to some substantial potential conflicts. For example, President Trump is locating his new hotel in Washington, D.C., on government property at the Old Post Office.[154] The rental agreement requires Trump’s company to pay both rent and annual payments based on the success of the business, necessitating continual negotiations.[155]; Steven Schooner, Professor of Government Procurement Law and Co-Director of the Government Procurement Law Program at The George Washington University Law School, pointed out that the potential conflict this causes is not covered by the Emoluments Clause. Professor Schooner stated, “[h]ow can anyone expect a government employee to negotiate with the Trump family at arm’s length and treat the Trump family like any other contractor?”[156] Due to the Emoluments Clause’s focus on the acceptance of foreign money and its reliance on congressional discretion, subjecting its enforcement to the potential bias of the majority party, make relying solely on it an unlikely solution.

III. The Proposal: Giving OGE Real Power to Prevent Conflicts of Interest Before a Candidate Takes Office

Approximately a month after Trump’s victory in the 2016 election, the Senate Committee on Homeland Security and Governmental Affairs enlisted the help of OGE in preventing any conflicts of interest.[157] The director of OGE, Walter Shaub, explained that although the agency oversees the ethics program of the executive branch, it “[lacks] authority to issue binding opinions.”[158] Over the past three decades, OGE has issued nonbinding recommendations regarding a President’s conflicts of interest.[159] Shaub notes, however, that “[w]hile OGE’s role in ethics issues involving the President is limited, OGE has significant involvement in ethics issues related to the President’s nominees.”[160] Presently, OGE has been unable to use its over thirty years of experience assisting Presidents with conflicts of interest, to do anything more than issue advisory opinions.[161] The purpose of this Article’s proposal is to give OGE actual power to take action, in the hopes that the President and Vice President would have to confront their conflicts of interest, rather than ignore its existence and potential effects on their policymaking.

Further, the rationale of some critics that the regulation of presidential conflicts of interest by Congress violates the separation of powers principle is flawed. Congress has the power “to make all [l]aws which shall be necessary and proper for carrying into [e]xecution for foregoing [p]owers, and all other [p]owers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.”[162] Under the Necessary and Proper Clause Congress not only has the power to decide when its own powers will be exercised and executed, but also has the discretion to decide how all federal government powers shall be executed, including that of the executive branch.[163] The Necessary and Proper Clause, Emoluments Clause, along with Congress’s legislative powers under Article I, and past conflict of interest legislation extending to the President, demonstrate that not all presidential conflicts of interest laws would be an over extension of Congress’s power. Therefore, Congress can create legislation applying to the President and Vice President, and through the Necessary and Proper Clause grant an independent agency both regulatory and enforcement authority over these new laws.[164]

A. Public Service is Public Trust: How OGE Can Combat Conflicts of Interest

By creating a rule that would prohibit Presidents from possessing the very conflicts of interest that plagued the 2016 election, future administrations would be forced to avoid even the appearance of bias decision-making. This Article’s proposal remedies the void in current conflict of interest regulation that was brought to the forefront during the 2016 election. Promulgating a rule that would prevent presidential conflicts of interest could reverse the current downward spiral of distrust in U.S. government officials. The purpose of the proposal is to remove potential biased decision-making by the President and Vice President, while ensuring accountability by having OGE, an expert on conflict of interest laws, tasked with enforcement, instead of it remaining as an oversight agency with no teeth.

In the last ten years, OGE has created revisions for the Ethics Act and has submitted reports to Congress containing legislative recommendations on issues such as executive branch conflicts of interest and improvements to financial disclosure requirements for presidential nominees.[165]

In an attempt to increase public trust in the government, Congress created OGE to help officials avoid having conflicts of interest. OGE “provides oversight, policy, and guidance to the executive branch regarding ethics laws and policies.”[166] OGE has around 80 full time employees, which is more members than other agencies that have the power to promulgate and enforce regulations, its Director serves five-year terms which overlaps with presidential terms, and has budget of $16 million.[167] (But Congress has not provided OGE with any actual investigative authority and OGE is limited to taking disciplinary action only against OGE employees.[168] Rather than give OGE the power to investigate and enforce its ethics laws and policies, Congress created a special prosecutor exception for accusations of high-ranking officials.[169]

As a result of the Watergate scandal, Congress sought to ensure any new legislation would avoid intelligence agencies working with the very officials being prosecuted.[170] Under Title VI of the Ethics Act [171] a special counsel was required when an official, such as the President or Vice President, are suspected of violating federal law.[172] The Attorney General of the United States was required to conduct a preliminary investigation whenever there is a suggestion that the President or Vice President has violated any federal criminal law.[173] These provisions were aimed at eliminating any actual or apparent conflicts of interest that are inherent in requiring the Attorney General to investigate high-level officials within the executive branch.[174] Because the Attorney General is a member of the executive branch and will always have an inherent conflict, Congress should instead grant OGE the power to oversee conflicts of interest regulations regarding the President and Vice President. The Department of Justice, however, would retain the power to initiate investigations and appoint independent counsel for any matter not concerning conflicts of interest for the President or Vice President.[175]

B. The Proposal: Candidate Commitment to Eliminating Financial Conflicts

The most effective way to overcome the recent phenomenon of global conflicts of interest is by tasking a politically neutral body with enforcing new rules. OGE, with its expertise in conflicts of interest prevention, is the best-suited independent agency and would avoid separation of powers issues between the legislative and executive branch.[176] OGE would be able to circumvent the unreliable policing power of a Congress that is of the same political party as the current administration.[177] This Article recommends Congress enact the following statute granting OGE the power to investigate and enforce violations of the statutory restrictions on conflicts of interest:

Whoever, being a candidate for the office of the President or Vice President, must agree before becoming a candidate, in writing, to place all financial interests that may pose a potential conflict of interest in a qualified blind trust if elected

1. Definitions.
   1. The term “candidate” for purposes of this regulation is “an individual who seeks nomination for election, or election, to Federal office.”[178]
   2. The term “assets” includes—
      1. “cash, stocks, bonds, mutual funds, [business holdings], or real estate.”[179]
   3. A “financial interest” comprises any asset, but is not limited to: personal assets, investment income, and private holdings of property and business.
   4. “A ‘qualified blind trust’ means a trust in which the employee, his spouse, or his minor or dependent child has a beneficial interest and which:”[180]
      1. the candidate, who remains the beneficiary, has no knowledge of the holdings of the trust, no right to intervene, and is managed by an independent trustee who can sell the assets and acquire new ones. For purposes of this regulation a qualified trust will be defined by 5 C.F.R. § 2634.402 (2012).
         1. “The income tax return of the Trust shall be prepared by the Trustee or his designee, and such return and any information relating thereto (other than the Trust income summarized in appropriate categories necessary to complete an interested party’s tax return), shall not be disclosed to the public or to any interested party”[181]
            1. acting as an exception to the reporting requirement of any federal conflict of interest laws.
         2. The term “independent trustee” means a third-party who is designated as the trustee and must:
            1. be independent from the candidate,
            2. have no affiliation or been employed by the candidate or any interested parties, and
            3. not be a relative of the candidate.[182]
         3. The “purpose” of the qualified blind trust is to give candidates an effective way to avoid allegations of financial conflicts of interest while avoiding complete divestiture.
   5. The candidate shall, once elected, within 60 days of the date of their inauguration, set up a qualified blind trust for their assets.
   6. Within 80 days of Inauguration Day, if the candidate has not complied and created a blind trust as required by (a)(4) & 5 C.F.R. §2634.402, OGE must bring a suit in the United States District Court for the District of Columbia—
      1. suit must be brought no later than two weeks after noncompliance.
   7. The United States District Court for the District of Columbia may assess against such individual a fine in any amount not to exceed $50,000 or imprisonment not longer than five years,[183] or both; and shall be incapable of running for or holding any office of honor, trust, or profit under the United States—
      1. aiming to eliminate real or apparent financial conflicts of interest and promote ethical decision-making while providing candidates notice and clear guidelines on expectations prior to running for office.

There are four major requirements of this proposed statute. First, this proposal creates a condition precedent requiring the President and Vice President to create a qualified blind trust within 60 days of their inauguration.[184] Second, the statute defines a blind trust and requires an independent trustee—which cannot be a friend or family member—be charged with controlling the trust. Third, the statute lays out enforcement procedures—if a President or Vice President fails to create a qualified blind trust within 80 days of Inauguration Day, OGE must bring suit. Finally, the proposed statute sets forth the maximum penalties for any official who fails to comply with these requirements. This condition precedent is a statement of the new reality that presidential candidates are no longer just career politicians, but are also entrepreneurs, investors, and individuals with diversified holdings.

i. Illustration: Proposed OGE Regulation in Action

This Article proposes the adoption of a OGE regulation that requires all presidential and vice presidential candidates to sign a condition precedent that if selected for office, within 80 days of inauguration, they will create a blind trust. To illustrate this rule, imagine it existed during the 2016 election. All candidates would have been required to contractually agree to create a blind trust and 80 days after the inauguration both President Trump and Vice President Mike Pence would be obligated to create a qualified blind trust that adheres to current federal regulations. [185] Unlike President Trump’s current trust, which is controlled by his two sons, this regulation requires that the trustee be an independent third party, with no connections to or relationship with the candidate or his financial assets. Had the regulation been in place during the 2016 election and Trump’s sons controlled the trust, OGE would sue Trump in the United States District Court for the District of Columbia for a willful and knowing violation of the agreed upon condition precedent.

A President like Trump has both liquid assets and his brand name—Trump. Some critics of blind trusts are concerned about the inability to forget what is placed into it and the complexity of putting your “identity” into a blind trust—e.g., Trump’s company is built on his name.[186] Complexity, however, does not equate to impossibility; candidates would be aware of the requirements and have the campaign cycle plus 80 days to consult with financial experts, if necessary. While admittedly a candidate upon placing their assets in a blind trust does not then suffer from amnesia and forget what they previously held, the candidate would have no control or knowledge of the inner workings of any current business holdings.

C. Counter argument: Takings Claim  

One potential critique of this proposal is that a regulation requiring candidates to place financial assets into a blind trust is equivalent to a regulatory taking. The Fifth Amendment and its Takings Clause prevents government action that infringes on private property without just compensation.[187] The Takings Clause’s protection of individual’s property encompasses more than just physical takings. In Penn Central Transportation Company v. City of New York [188], The Supreme Court looked to the “economic impact of the regulation on the claimant and, particularly, the extent to which the regulation has interfered with distinct investment-backed expectations.” [189]

In Pennsylvania Coal Co. v. Mahon,[190] the Supreme Court explained that physical possession was not necessary—intensive regulation could also amount to a taking.[191] If the interference causes a total loss of freedom to use the property, it is the equivalent of a physical possession—i.e., a taking.[192] Yet short of complete interference it is unclear what constitutes a compensable taking.[193] The ambiguity in this analysis has led to the government only needing to satisfy a broad general public welfare requirement by asserting a somewhat reasonable connection between the condition and advancing the general public welfare.[194]

Under the current interpretation of public welfare, it is extremely unlikely that the requirement of a blind trust for an individual who decides to run for office constitutes a regulatory taking. This is because the regulation of these assets, for the duration of the candidate’s term, advances the public welfare by helping remove any self-interested decision-making. The government would, also, not be “taking” the assets, rather an independent trustee appointed by the candidate becomes responsible.[195] Because the trustee would be generating income comparable to what the candidate would have been making, it is hard to see how requiring a blind trust would be the equivalent of a regulatory taking.

D. Why the Proposed Statute is More Efficient Than the Alternatives

This proposed regulation is not the only solution to prevent decision-making that is tainted by self-interest. This section explains why this proposal is superior to the commonly suggested alternative conflict of interest solutions—a constitutional amendment, impeachment, or the use of special counsel.

i. Constitutional Amendment

As previously mentioned, some critics suggest that subjecting the President to conflicts of interest laws violate the separation of powers principle.[196] To avoid all suggestions of separation of powers issues, the Constitution could be amended to require Presidents to remove their conflicts of interests, thereby eliminating any suggestion that Congress was overstepping its power. But amending the Constitution to combat conflicts of interest is unlikely to be successful. Article V requires two-thirds of both the house and senate just to propose a law and then three-fourths of the states still must ratify the amendment for it to be successful.[197] Alternatively, a convention called for by two-thirds of the state legislatures may propose an amendment and three-fourths of the states must approve it.[198] In over 220 years, more than 11,000 amendments have been proposed but only 27 have been ratified.”[199] With the current political climate and increased outcry and media attention of conflicts of interest it is imperative that the current federal ethics laws change. But the past has made it clear: “constitutional amendments have not been an important means of changing the constitutional order.”[200]

ii. Congress Takes Charge

Rather than attempt the lengthy and almost impossible process of amending the Constitution, Congress could use its impeachment powers to dissuade potential candidates from retaining any financial interests that may cause a conflict. Although Congress cannot create additional requirements for the President, it is unlikely that expanding federal conflict law to them would be a constitutional violation.[201] For example, during the Civil War Congress enacted financial conflict of interest statutes that did not exempt the President.[202] Even after this statute was amended to exempt the President, for the past forty years every President has chosen to utilize a blind trust or the equivalent.[203] Clearly, expanding a financial conflict law to the President would not necessarily impede his ability to fulfill his constitutional duties. The question, therefore, becomes: how can Congress expand conflict of interest laws to the President without violating the separation of powers principle?

Congress could use its impeachment power as an incentive for Presidents to sever their conflicts of interest. “The president, vice-president, and all civil officers of the United States, shall be removed from office on impeachment for, and conviction of treason, bribery, or other high crimes and misdemeanors.”[204] However, the founders did not clarify what constituted “high crimes and misdemeanors” and if these crimes are required to be against the state.[205] the auto insurance lobby stands to come out financially neutral if not positive: insurers do not bear the cost of technology, but benefit from decreased payouts due to the technology’s use. If insurers adjust premiums to match this decreased cost proportionately, they are no better off; but if they do so to a lesser degree than that by which costs fall, their margins should increase. It is no wonder that other anti-drunk driving measures have earned the support of insurance companies. During the Clinton impeachment, Republicans submitted that Clinton’s “abuse of trust or bringing ill repute on the presidency” and perjury were sufficient reasons for impeachment.[206] Thirteen constitutional law scholars, at the House Committee hearing, argued that Clinton’s alleged conduct did not rise to the level of “high crimes and misdemeanors” because it did not involve the “derelict exercise of executive powers” but rather just private conduct.[207] Ultimately Clinton was not removed from office, but this does not mean that the allegations were not proper for impeachment.

Some commenters proffer that the constitutional ban on accepting payments from foreign officials along with United States anti-corruption laws against bribery could be used as a justification for an impeachment proceeding.[208] Impeachment, however, is unpredictable. For example, Trump’s hotels are all over the globe and receive money and business from various foreign nationals.[209] These payments could be seen as bribes[210] because they create a concern that Trump’s foreign policy decisions will be influenced by these patrons.[211] But even if a conflict of interest were found to be a “high crime or misdemeanor,” impeachment would not be a predictable means of ensuring that all Presidents would be held accountable as impeachment is both political and legal.[212] Impeachment is discretionary and if Congress is controlled by the same party as the current administration, it is unlikely an impeachment proceeding would achieve the requisite votes.[213]

iii. The Executive Investigates

When the House and Senate are controlled by the present administration it can be easy to imagine situations where certain Presidents would be allowed to escape financial conflict of interest regulations, while others would not. To avoid the suspicion of bias, special counsel[214] could be appointed to investigate Presidents who have potential conflicts of interest. Special counsel is generally appointed by the Attorney General, a member of the executive branch who is appointed by and can also be removed by the President.[215] In the past, United States attorneys of the same party as the defendant or President who appointed them have brought prosecutions against them.[216] Nonetheless, some of the biggest cases were frustrated by the conflict of interest that exists when the Department of Justice investigates and prosecutes the executive branch.[217]

Special counsel have a history of encountering uncooperative Presidents.[218] In 2017 the FBI investigated allegations that Russia interfered in the 2016 election. Shortly thereafter, Trump fired the director of the FBI, James Comey,[219] and the Attorney General, Jeff Sessions, recused himself.[220] As a result, the DOJ assigned the investigation to a special counsel, Robert Mueller.[221] Trump attempted to interfere with the investigation by suggesting that Mueller and several members of his team had conflicts of interest.[222] Even the Ethics Act acknowledges the inherent conflict of interest of the Department of Justice investigating the executive branch, which can be illustrated through President Trump’s relationship with Deutsche Bank.[223] One of President Trump’s biggest lenders is Deutsche Bank, who recently reached a settlement with the Department of Justice regarding its involvement in the 2008 financial crisis.[224] Now that Trump is the head of the branch in charge of investigations such as this, every decision the Justice Department makes may be more closely scrutinized.[225] To avoid conflicts of interest the Department of Justice could, but is not required to, appoint a special counsel.[226] Although, Trump would be unable to fire this prosecutor, helping to remove bias, this individual would still report to superiors who are connected to the President.[227]

Because the Attorney General appoints the special counsel, Congress granting additional control could be seen as a power grab.[228] Similar to an expansion of § 208, special counsel also raises a concern that the President will be prevented from fully exercising his constitutional duties.[229] Justice Scalia was concerned that expanding the special prosecutor’s power would weaken the presidency by subjecting the head of the executive branch to potentially “debilitating criminal investigation.”[230] But Justice Scalia was in the minority. In Morrison v. Olson,[231] the Supreme Court held that Congress could protect a special counsel from removal by the President.[232] The Attorney General could overcome this congressional oversight only by a showing that the removal would impede the President’s “ability to perform his constitutional duties.”[233]

Recently, the majority’s decision in Morrison v. Olsen has come under fire while Scalia’s dissent has garnered supporters. In 2016, the D.C. Circuit decided PHH Corporation v. Consumer Financial Protection Bureau (“CFPB”) [234] which involved the constitutionality of restricting a President’s ability to fire an agency’s director. The court’s opinion, written by Judge Brett Kavanaugh, suggested that Morrison v. Olsen was incorrect, citing to Scalia’s dissent multiple times.[235] Judge Kavanaugh explained that “[t]he independent counsel experiment . . . ended with universal consensus that . . . Scalia had been right back in 1988 to view [it] as an unconstitutional departure from historical practice and a serious threat to individual liberty.”[236] In 2018, the D.C. Circuit reversed its 2016 decision and found that the CFPB’s structure was constitutional.[237] But Judge Kavanaugh’s opinion demonstrates that Morrison v. Olson may be losing its authority.

Even if a special counsel can investigate a President for potential conflicts of interest it is unlikely this would be effective. Archibald Cox, a special prosecutor appointed by Attorney General Elliot Richardson to investigate President Nixon’s administration, was dismissed after subpoenaing the “White House tapes.”[238] Cox was not dismissed because of his integrity or alleged partisanship, but rather for refusing to comply with the President’s wishes.[239] In fact, both Attorney General Richardson and Attorney General Ruckelshaus, who supported Cox, resigned after his proposed dismissal.[240] Congress is concerned that Trump will follow in Nixon’s footsteps and have Mueller fired. In an effort to prevent Presidents from impeding these investigation, Congress proposed two bipartisan bills[241] to provide safeguards for special counsel fired without good cause.[242] Congress’s fears are not without merit. In an interview with the New York Times, Trump entertained the prospect of firing Mueller if he investigated his and his family’s finances.[243]

Conclusion

As the 2016 presidential election demonstrates, the current legislation regarding federal conflicts of interest is inadequate. Even those who are not persuaded by this Article’s proposal cannot deny that the 2016 election made it clear that federal conflicts of interest need to be addressed. With the increasing skepticism in the federal government, it is necessary that a national policy to help overcome modern distrust of the political system is created. To help achieve this, a new ethical standard for the President and Vice President that helps manage the regulation of conflicts of interest needs to be implemented. More far-reaching legislation is essential to prevent self-interested decision-making that impacts U.S. citizens and residents. Although new laws may not prevent all conflicts of interest, the best way to remove bias from executive actions is to eliminate the most noticeable conflicts at the commencement of an administration. The reformed ethical standard must be “beyond reproach.”[244] It is crucial that effective regulation of conflicts of interest extending to the President and Vice President are created to revitalize the trust in U.S. governmental officials.

 

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[*] J.D. 2018, George Washington University

[1] The Federalist No. 68, at 459–60 (Alexander Hamilton) (Clinton Rossiter ed., 1961).

[2] Since conflicts of interest laws apply to the President and Vice President in the same way, this Article’s reference to presidential conflicts of interest law also incorporates the Vice President.

[3] See Morgan, Lewis & Bockius LLP, Status of U.S. Federal Income Tax Returns (March 7, 2016), https://assets.donaldjtrump.com/Tax_Doc.pdf [https://perma.cc/57WZ-LWPT ]; U.S. Office of Gov’t Ethics, OMB No. 3209-0001, Executive Branch Personnel Public Financial Disclosure Report (2016).

[4] See 18 U.S.C. § 208 (2012).

[5] See Claire Hill & Richard Painter, Compromised Fiduciaries: Conflicts of Interest in Government and Business, 95 Minn. L. Rev. 1637, 1640 (2011).

[6] See, e.g. 18 U.S.C. §§ 203–208 (2012).

[7] United States v. Miss. Valley Generating Co., 364 U.S. 520, 548 (1961); see also Kevin Kelcourse, Conflicts of Interest, 26 Am. Crim. L. Rev. 713, 713 (1989).

[8] See Exec. Order No. 11,222 3 C.F.R. 306 (1964–1965), revoked Exec. Order No. 12,674, 3 C.F.R. 215 (1990) (requiring government officials to remove any “direct or indirect financial interests.”); Roger Mudd, The Place to Be: Washington, CBS, and the Glory Days of Television News,  98–99 (2008).

[9] See Kelcourse, supra note 7, at 723.

[10] The Federalist No. 10, at 131 (James Madison) (Clinton Rossiter ed., 1961).

[11] See 18 U.S.C. § 208(b)(4) (2015).

[12] Jack Maskell, Cong. Research Serv., RL31822, Entering the Executive branch of Government: Potential Conflicts of Interest With Previous Employment and Affiliation 1 (2007).

[13] See Act of Feb. 26, 1853, ch. 81, § 2, 10 Stat. 170 (codified as amended at 18 U.S.C. § 205 (2012); See Pub. L. 87-849, 76 Stat. 1126 (1962) (amending statute to exempt the President); Kathleen Clark, Congress Can and Must Restrict the President’s Financial Conflicts of Interest, N.Y. Times (Dec. 7, 2016), http://www.nytimes.com/roomfordebate/2016/12/07/can-congress-end-donald-trumps-conflict-of-interest-exemption[https://perma.cc/YBX7-EA6T]. The Ethics Reform Act of 1989 amended the Civil War conflict of interest statute to exempt the President, but Congress likely retains the power to amend it again. See id.

[14] See Loretta Santacroce, The Impact of the Ethics in Government Act of 1978, at 12 (1978).

[15] Id.

[16] Exec. Order No. 11,222, 3 C.F.R. 306 (1964–1965), revoked Exec. Order No. 12,674, 3 C.F.R. 215 (1990). Part three pertains to “special Government employees” and prohibits these employees from using their positions for private gain. Id.

[17] See id.

[18] Title IV of the Ethics in Government Act of 1978, Pub.L. No. 95-521, 92 Stat. 1855-62 (1978) (codified as amended at 5 U.S.C. §§ 401–408 (2012)). 

[19] S. Rep. No. 95-170, at 21 (1977).

[20] See Stuart C. Gilman, Law and Implementation of Ethics Systems in the United States: One Step Toward Controlling the Cancer of Corruption, LAWASIA J. 110, 114 (1998).

[21] See Office of Government Ethics, USA.Gov (last visited March 5, 2017), https://www.oge.gov/web/oge.nsf/OGE+Legislative+Proposals [https://perma.cc/LTS4-67W4].

[22] See e.g., U.S. Off. of Gov’t Ethics, Report to the President and to Congressional Committees on the Conflict of Interest Laws Relating to Executive Branch Employment (2006).

[23] H.R. Rep. No. 87-748, at 21 (1961).

[24] See 18 U.S.C. §§ 202(c), 208 (2012); Paul Blumenthal, President Trump Won’t Have to Tell CEO Trump ‘You’re Fired,’ Huffington Post (Sept. 11, 2015), http://www.huffingtonpost.com/entry/president-trump-conflict-of-interest_us_55f1eb0be4b002d5c078b44c [https://perma.cc/85S7-RGV3].

[25] Blumenthal, supra note 24.

[26] Maskell, supra note 12, at 3.

[27] See id.

[28] Jon L. Mills, The Future of Governmental Ethics: Law and Morality, 17 Dick. J. Int’l L. 405, 436 (1999).

[29] S. Rep. No. 95-170, at 22 (1977); see also 5 U.S.C. § 101(f)(1)–(2) (2015).

[30] Pub. L. 101-194, 103 Stat. 1747 (1989).

[31] See Memorandum for Richard T. Burress, Office of the President, from Laurence H. Silberman, Deputy Attorney General, Re: Conflict of Interest Problems Arising out of the President’s Nomination of Nelson A. Rockefeller to be Vice President under the Twenty-Fifth Amendment to the Constitution at 2, 5 (Aug. 28, 1974).

[32] See CRS Legal Sidebar, Conflicts of Interest and the Presidency 1 ( 2016), https://fas.org/sgp/crs/misc/conflicts.pdf [https://perma.cc/4UGA-XTKT].

[33] See id.

[34] Id.; see also Jack Maskell, Cong. Research Serv., R43186, Financial Disclosure by Federal Officials and Publication of Disclosure Reports 3–4 (2013). Congress recognizes the influential power money can have over an individual and has created various disclosure and conflicts laws affecting both candidates and elected officials. One such example is the federal campaign finance laws, requiring disclosure of certain campaign contributions that a candidate receives and spends. See All. for Justice, Applicability of the Ethics in Government Act to Federal Judges 3 (2011).

[35] The Federalist No. 71, at 432 (Alexander Hamilton) (Clinton Rossiter ed., 1961); see also John Adams, Letter from John Adams to Mercy Otis Warren, April 16, 1776, in Papers of John Adams, vol. 4, February–August 1776 (Robert J. Taylor ed. 1979), 123, 123–126 (“There must be a positive passion for the public good, the public interest, honour, power and glory, established in the minds of the people, or there can be no republican government, nor any real liberty: and this public passion must be superior to all private passions.”).

[36] See Maskell, supra note 12, at 3–4.

[37] See 18 U.S.C. § 208 (2015); Buckley v. Valeo, 424 U.S. 1, 66–68 (1976); Cal. Bankers Assoc. v. Schultz, 416 U.S. 21 (1974). The Supreme Court has generally upheld campaign finance disclosure requirements to ensure transparency and accountability. See Buckley, 424 U.S. 1; Cal. Bankers Assoc., 416 U.S. 21.

[38] See S. Rep. No. 95-170, at 22 (1977).

[39] See 18 U.S.C. § 208 (2012); Employee Benefits Security Administration; Definition of the Term “Fiduciary”; Conflict of Interest Rule-Retirement Investment Advice, 81 Fed. Reg. 20945 (Apr. 8, 2016) (“Disclosure alone has proven ineffective to mitigate conflicts in advice.”); M.A.G. Capital, LLC, Advisers Act Release No. 2849 (2009); Susan P. Shapiro, Bushwhacking the Ethical High Road: Conflict of Interest in the Practice of Law and Real Life, 28 Law & Soc. Inquiry 87, 229 n. 216 (2003) (explaining that “[d]isclosure may not only oversimplify a complex issue but also in itself mislead, sometimes damagingly so”); Kevin P. Weinfurt et al, Disclosing Conflicts of Interest in Clinical Research: Views of Institutional Review Boards, Conflict of Interest Committees, and Investigators, 2006 J. Law, Med, & Ethics 581 (Study on impact of disclosure in clinical research, finding that it may lead to negative consequences such as “underm[ing] the trust of potential research participants.”).

[40] Org. Econ. Co-operation & Dev., Managing Conflicts of Interest in the Public Service 17 (2003).

[41] See All. for Justice, supra note 34, at 1.

[42] See id.

[43] See Maskell, supra note 12, at 9. There is a “regulatory” recusal requirement that is broader and, in certain circumstances, will extend to past financial ventures. See id.

[44] See 18 U.S.C. § 208 (2012).

[45] See 18 U.S.C. § 208(d)(2) (2012); Eric Meermann, Ethical Investing for Federal Officials, Palisades Hudson Fin. Frp. LLC (Apr. 1, 2009), http://www.palisadeshudson.com/2009/04/ethical-investing-for-federal-officials/.

[46] Meermann, supra note 45.

[47] See 18 U.S.C. § 202(c) (2012); Maskell, supra note 12, at 5.

[48] See 18 U.S.C. § 202(c) (2012) (Excludes President and Vice President); Jack Maskell, Cong. Research Serv., RS21656, The Use of Blind Trusts by Federal Officials 3 n.9 (2005). Before the exemption was adopted, the DOJ informed the Senate that a disqualification requirement could interfere with the President and Vice President’s constitutional duties. See Conflicts of Interest and the Presidency, supra note 32, at 1; All. for Justice, supra note 34, at 1. 

[49] See Conflicts of Interest and the Presidency, supra note 32, at 1.

[50] See Maskell, supra note 12, at 15.

[51] See Monica Langley, Why Donald Trump, as President Wouldn’t Face Conflict-of-Interest Laws, Wall St. J. (July 4, 2016) http://www.wsj.com/articles/why-donald-trump-as-president-wouldnt-face-conflict-of-interest-laws-1467648595 [https://perma.cc/RJW4-UY6Z]. In 2006, Henry Paulson, former Goldman Sachs Chief Executive, sold about $500 million worth of Goldman stock when appointed Treasury secretary. See id. Additionally, former New York Mayor, Michael Bloomberg, resigned from all of his board and management positions before taking office. See id.

[52] See Meermann, supra note 45. Lynn will also forfeit any unvested restricted stock that does not vest within 90 days after his confirmation. See id.

[53] See id.

[54] See id.

[55] See Senate Select Comm. on Ethics, 114th Cong., Qualified Blind Trusts 1 (Comm. Print. 2015).

[56] See id.; Communications, Q&A: Government Officials’ Blind Trusts, Open Secrets (Mar. 8, 2007), https://www.opensecrets.org/news/2007/03/qa-government-officials-blind/ [https://perma.cc/6QUN-537Y].

[57] See Conflicts of Interest and the Presidency, supra note 32, at 1.

[58] Senate Select Comm. on Ethics, supra note 55, at 2. An ideal independent trustee is a financial institution, such as a trust company or a bank that has no relationship with the trustee or his family. See id.

[59] See Meermann, supra note 42; Jennifer Wang, Why Trump Won’t Use a Blind Trust and What His Predecessors Did With Their Assets, Forbes (Nov. 16, 2106), https://www.forbes.com/sites/jenniferwang/2016/11/15/why-trump-wont-use-a-blind-trust-and-what-his-predecessors-did-with-their-assets/#29c0542729c0 [https://perma.cc/Q79U-U2XT].

[60] Meermann, supra note 42.

[61] See id.

[62] See Nicolas Rapp, Who Needs a Blind Trust?, Fortune (Oct. 22, 2012), http://fortune.com/2012/10/22/who-needs-a-blind-trust/ [https://perma.cc/66WP-FQZB].

[63] See Megan J. Ballard, The Shortsightedness of Blind Trusts, 56 U. Kan. L. Rev. 43, 45–46 (2007).

[64] See Meermann, supra note 42.

[65] See Communications, Q&A: Government Officials’ Blind Trusts, supra note 56.

[66] See Meermann, supra note 42.

[67] See id. In fact President Barack Obama’s five predecessors all used blind trusts. See id.

[68] See id.

[69] See id. While considering a presidential run, Frist stated that he sold these shares to avoid the appearance of a conflict of interest. See Gina Pace, Frist Says He’s Cooperating Fully, CBSNᴇᴡꜱ (Oct. 18, 2005), https://www.cbsnews.com/news/frist-says-hes-cooperating-fully/ [https://perma.cc/46Y4-VUPR]. The media, however, was wary of Frist’s justification and began investigating many of his prior actions, such as supporting legislation that benefited his family’s company. See Sheryl Gay Stolberg, For Frist, a Political Fortune May Be Inextricably Linked to a Financial One, N.Y. Tɪᴍᴇꜱ (Oct. 25, 2005), http://query.nytimes.com/gst/fullpage.html?res=9C07EED9103FF936A15753C1A9639C8B63&pagewanted=all [https://perma.cc/46Y4-VUPR].

[70] See Christopher Tarver Robertson, Blind Expertise, 84 N.Y.U. L. Rev. 174, 257 (2010).

[71] A qualified blind trust is subject to 5 C.F.R. § 2634 (2017) and is interpreted by the Office of Government Ethics (“OGE”).

[72] See 5 U.S.C. app. § 102 (2012). It has been the “consistent policy of the executive branch that a President should conduct himself “as if” he were bound by this financial conflict of interest law.” Letter from Walter M. Shaub, Jr., Dir. of the United States Office of Gov’t Ethics, to Thomas R. Carper, Comm. on Homeland Sec. and Governmental Affairs (Dec. 12, 2016), available at https://www.oge.gov/web/oge.nsf/Congressional%20Correspondence/092B59EFD6EC27608525808800724288/$FILE/Carper%20response.pdf?open [https://perma.cc/KMX4-RTWN].

[73] See e.g., Ashley C. Allen, Report: The 10 Richest U.S. Presidents, USA Today (Feb. 15, 2014) http://www.usatoday.com/story/money/business/2014/02/15/10-richest-presidents/5514567/ [https://perma.cc/QZR7-4ZJA]; Michael B. Sauter, Ashley C. Allen, & Douglas A. McIntyre, The Net Worth of the American Presidents: Washington to Obama, 24/7 Wall St. (May 17, 2010), http://247wallst.com/banking-finance/2010/05/17/the-net-worth-of-the-american-presidents-washington-to-obama/ [https://perma.cc/ZH27-4K9E].

[74] Note, American Slavery and the Conflict of Laws, 71 Colum. L. Rev. 74, 79 (1971).

[75] See Carl Cavanagh Hodge & Cathal J. Nolan, U.S. Presidents and Foreign Policy: From 1789 to the Present 102 (2007); Aaron Schwabach, Thomas Jefferson, Slavery, and Slaves, 33 T. Jefferson L. Rev. 1, 3, 36 (2010). By 1743, the year of Jefferson’s birth, the Virginia legislature had determined that slaves were “real estate.” See A. Leon Higginbotham, Jr., In the Matter of Color: Race & the American Legal Process 52 (1978).

[76] See Allen, supra note 73. Presidents Buchanan, Lincoln, Grant, Hayes, and Garfield had “modest net worths” and did not have the means to live as they did during their presidency. See id.

[77] See id. Herbert Hoover owned mining companies where he made millions of dollars. See Ashley C. Allen, The 5 Richest and 5 Poorest U.S. Presidents, MSN (Feb. 13, 2014), http://www.msn.com/en-us/money/savingandinvesting/the-5-richest-and-5-poorest-us-presidents/ss-AA9mzvu [https://perma.cc/KC66-BSQL].

[78] See Agustino Fontevecchia, Forbes’ 2016 Presidential Candidate Wealth List, Forbes (Sept. 29, 2015), http://www.forbes.com/sites/afontevecchia/2015/09/29/forbes-2016-presidential-candidate-net-worth-list/#5d0ad79e435d; Allen, supra note 73. For example, the Kennedys’ wealth was derived from Joseph Kennedy’s business and Theodore Roosevelt, Franklin D. Roosevelt, John F. Kennedy, and both Bushes also inherited a considerable amount of their money. See Agustino Fontevecchia, Forbes’ 2016 Presidential Candidate Wealth List, Forbes (Sept. 29, 2015), http://www.forbes.com/sites/afontevecchia/2015/09/29/forbes-2016-presidential-candidate-net-worth-list/#5d0ad79e435d [https://perma.cc/P2SW-M7XY].

[79] See Emily Atmore, Unprecedented: President Trump’s Divided Loyalties, Uɴɪᴠ. Mɪɴɴ. L. Rᴇᴠ. (Feb. 1, 2017), http://www.minnesotalawreview.org/2017/02/unprecedented/#post-2273-footnote-2 [https://perma.cc/5USA-6TTE].

[80] United States v. Miss. Valley Generating Co., 364 U.S. 520, 562 (1961).

[81] Roger Cohen, The Age of Distrust, N.Y. Times (Sept. 19, 2016), http://www.nytimes.com/2016/09/20/opinion/the-age-of-distrust.html [https://perma.cc/UY2N-5WX3]; Jay Cost, The Politics of Distrust, Wall St. J. (Oct. 16, 2015), http://www.wsj.com/articles/the-politics-of-distrust-1445015969 [https://perma.cc/8PX7-LAQR]; John Herbers, Full Disclosure is Now a Family Affair, N.Y. Times (Aug. 19, 1984), http://www.nytimes.com/1984/08/19/weekinreview/full-disclosure-is-now-a-family-affair.html [https://perma.cc/U2ZD-P4Y3].

[82] Caleb Melby, Balcki Milgliozzi & Michael Keller, Trump’s Immigration Ban Excludes Countries With Business Ties, Bloomberg Politics (Mar. 6, 2017), https://www.bloomberg.com/graphics/2017-trump-immigration-ban-conflict-of-interest/ [https://perma.cc/MSA3-AEE7]. For example, both Turkey (where the Trump Organization owns two “luxury towers” which brought in around $5 million in 2016) and the United Arab Emirates (where the Trump Organization has a licensing and management deal for a golf course and villas) are absent from the list. See id. On March 6, 2017, Trump signed an executive order banning immigration from several countries in the Middle East. Interestingly, Turkey (where the Trump Organization owns two “luxury towers” which brought in around $5 million in 2016) and the United Arab Emirates (where the Trump Organization has a licensing and management deal for a golf course and villas) are absent from the Order. See id.

[83] See Tom Hamburger, Romney Using Ethics Exception to Limit Disclosure of Bain Holdings, Wash. Post (Apr. 5, 2012), https://www.washingtonpost.com/politics/romney-using-ethics-exception-to-limit-disclosure-of-bain-holdings/2012/04/05/gIQARcVmxS_story.html [https://perma.cc/2VYQ-QMCA].

[84] See id.; David Corn, Mitt Romney Has a Huge New Conflict-of-Interest Problem, Mother Jones (Jan. 16, 2015), http://www.motherjones.com/politics/2015/01/mitt-romney-new-private-equity-problem-solamere-capital [https://perma.cc/5JZL-RCUY]; Conflicts of Interest and the Presidency, supra note 32, at 1.

[85] See Todd S. Purdum, An Age Old Ruse, Vanity Fair (July 12, 2012), https://www.vanityfair.com/news/2012/07/mitt-romney-age-old-ruse-blind-trust [https://perma.cc/5W6N-BHQR]; Matthew Mosk, Mitt Romney’s Blind Trust Not So Blind, ABC News (Dec. 19, 2011), http://abcnews.go.com/Blotter/mitt-romneys-blind-trust-blind/story?id=15188063 [https://perma.cc/7QXQ-9DH8].

[86] See Louis Jacobson, Chris Matthews Says Cheney Got $34 Million Payday From Halliburton, PolitiFact (May 24, 2010), http://www.politifact.com/truth-o-meter/statements/2010/may/24/chris-matthews/chris-matthews-says-cheney-got-34-million-payday-h/ [https://perma.cc/Z7HE-BTER]; Blumenthal, supra note 24; Richard James DeSocio, Rockefellerocracy: Kennedy Assassinations, Watergate and Monopoly of the “Philanthropic” Foundations 52 (2013).

[87] See DeSocio, supra note 86.

[88] In 1974, following Richard Nixon’s resignation over the Watergate Scandal, Gerald R. Ford became President and appointed Nelson Rockefeller as his Vice President.

[89] See Herbers, supra note 81. Rockefeller’s potential conflicts included large donations to members of Congress, state, and national officials. See also Letter from Nelson A. Rockefeller to Senator Howard W. Cannon, Chairman of the Senate Comm. on Rules and Admin. 3—6 (Oct. 11, 1974) (on file with the Gerald R. Ford Presidential Library); Akhil Reed Amar & Vikram David Amar, Essay, Is the Presidential Succession Law Constitutional?, 48 Stan. L. Rev. 113, 129 (1995); Joel K. Goldstein, Taking From the Twenty-Fifth Amendment: Lessons in Ensuring Presidential Continuity, 79 Fordham L. Rev. 959, 973 (2011). Rockefeller also owed more than $900,000 in taxes and his family’s interests were so large that a lot of public policy decisions would no doubt affect his family’s wealth. See Letter from Nelson A. Rockefeller to Senator Howard W. Cannon, supra at 1.

[90] See Goldstein, supra note 89, at 972.

[91] See David E. Rosenbaum, A Closer Look at Cheney and Halliburton, N.Y. Times (Sept. 28, 2004), http://www.nytimes.com/2004/09/28/us/a-closer-look-at-cheney-and-halliburton.html [https://perma.cc/KZV4-Z8MD]; see also Brett Deforest Maxfield, Ethics, Politics and Securities Law: How Unethical People are Using Politics to Undermine the Integrity of Our Courts and Financial Markets, 35 Ohio N.U. L. Rev. 243, 262 (2009).

[92] See Rosenbaum, supra note 91.

[93] President Obama recognized the dangers of no-bid contracts; he stated “[e]xcessive reliance by executive agencies on sole-source contracts . . . create[] a risk that taxpayer funds will be spent on contracts that are wasteful, inefficient, [and] subject to misuse.” See Sharon Weinberger, Windfalls of War: Pentagon’s No-Bid Contracts Triple in 10 Years of War (Aug. 29, 2011), https://www.publicintegrity.org/2011/08/29/5989/windfalls-war-pentagons-no-bid-contracts-triple-10-years-war [https://perma.cc/ZCC7-L42G].

[94] See Angelo Young, And the Winner for the Most Iraq War Contracts Is. . . KBR, with $39.5 Billion in a Decade (Mar. 19, 2013), http://www.ibtimes.com/winner-most-iraq-war-contracts-kbr-395-billion-decade-1135905 [https://perma.cc/4CXA-CJUL]; Angie Drobnic Holan, Halliburton, KBR, and Iraq War Contracting: A History So Far (June 9, 2010), http://www.politifact.com/truth-o-meter/statements/2010/jun/09/arianna-huffington/halliburton-kbr-and-iraq-war-contracting-history-s/ [https://perma.cc/C62Z-6FV2]; Rosenbaum, supra note 91. Cheney, through his stock in Halliburton, received $350,000 while in office. See Naomi Klein, Bomb Before You Buy: The Economics of War, 2 Seattle J. Soc. Just. 331, 336 (2004).

[95] See H.R. Res. 333, 110th Cong. (2007); Dmitry Barn, Making Appearances Matter: Recusal and the Appearance of Bias, 2011 BYU L. Rev. 943, 943 (2011).

[96] H.R.Res. 333, 110th Cong. (2007); CQ Transcript Wire, Kucinich Introduces Impeachment Articles Against Cheney, Wash. Post (Apr. 24, 2007). On November 6, 2007, after months of not being addressed by the House Judiciary Committee, Kucinich reintroduced the impeachment as a new resolution, which expired with the end of the 110th Congress, thus allowing Cheney to avoid impeachment. See H.R.Res. 799, 110th Cong. (2007); H.R.Res. 333, 110th Cong. (2007) (all legislation not enacted at the end of the 110th Congress was cleared); Lauren Kornreich, Third Time’s Not the Charm for Kucinich, CNN Pol. Ticker (Nov. 6, 2007), http://politicalticker.blogs.cnn.com/2007/11/06/third-times-not-the-charm-for-kucinich/comment-page-8/ [https://perma.cc/TJT5-5SWJ].

[97] See Blumenthal, supra note 24; Andrew Giambrone, Trump on D.C. Statehood: “I Have a Conflict of Interest,” City Paper (Aug. 16, 2015), http://www.washingtoncitypaper.com/news/city-desk/blog/13069849/trump-on-d-c-statehood-i-have-a-conflict-of-interest [https://perma.cc/MUM9-RY54].

[98] Interview by Chuck Todd with Donald Trump, Presidential Candidate, in Washington, D.C. (Aug. 16, 2015), http://www.nbcnews.com/meet-the-press/meet-press-transcript-august-16-2015-n412636 [https://perma.cc/HK46-WBAY].

[99] Susanne Craig & Eric Lipton, Trump’s Plans on Business May Fall Short, N.Y. Times (Jan. 11, 2017), https://www.nytimes.com/2017/01/11/us/politics/trump-organization-business-conflicts.html [https://perma.cc/3CSN-TJH5]; see also Aaron Blake, Donald Trump’s questionable ‘Blind Trust’ Setup Just Got More Questionable, Wash. Post (Nov. 11, 2016), https://www.washingtonpost.com/news/the-fix/wp/2016/11/11/donald-trumps-questionable-blind-trust-setup-just-got-more-questionable/?utm_term=.960b96efe972 [https://perma.cc/MZG6-YHC5]; Editorial, Trump’s Not-So-Blind Trust Fails Ethical Standards, Boston Globe (Nov. 18, 2016), https://www.bostonglobe.com/opinion/editorials/2016/11/18/trump-not-blind-trust-fails-ethical-standards/9LvLgGokNwsGVVgWjJuJfJ/story.html [https://perma.cc/34QC-Z3VF]; Kurt Eichenwald, Donald Trump’s ‘Blind Trust’ Plan Makes No Sense, Newsweek: The Scoop (Sept. 20, 2016), http://www.newsweek.com/2016/09/30/donald-trump-blind-trust-foreign-business-deals-500398.html [https://perma.cc/F2WZ-W4RF]; Nicholas Fandos & Eric Lipton, Donald Trump Shouldn’t ‘Put His Children Out of Work,’ Giuliani Says, N.Y. Times (Nov. 13, 2016), https://www.nytimes.com/2016/11/14/us/politics/donald-trump-shouldnt-put-his-children-out-of-work-giuliani-says.html [https://perma.cc/XN7Q-YEUG]; Darren Samuelsohn, Trump’s Kids to Run Businesses Via ‘Blind Trust,’ Trump Attorney Says, Politico (Nov. 10, 2016), http://www.politico.com/story/2016/11/trump-children-business-blind-trust-231179 [https://perma.cc/XN7Q-YEUG].

[100] See Blake, supra note 99; Glenn Thursuh & Maggie Haberman, Jared Kushner Named Senior White House Adviser to Donald Trump (Jan. 9, 2017), https://www.nytimes.com/2017/01/09/us/jared-kushner-senior-adviser-white-house-trump.html [https://perma.cc/34VL-RBNE]. A further issue with Trump’s involvement in the vetting process may arise when a cabinet official is also a family member, such as the Senior White House Advisor, Jared Kushner, who is Trump’s son-in-law. See Blake, supra note 99.

[101] See Laurel Raymond, Trump Has Violated His Oath to the Constitution, Think Progress, https://thinkprogress.org/trump-constitution-first-day-office. [https://perma.cc/7PS2-FSK2].

[102] See Spotlight on the Emoluments Clause, Suffolk U. L. Rev. Online (Feb. 8, 2017), http://suffolklawreview.org/spotlight-on-the-emoluments-clause/ [https://perma.cc/PVV7-BACH].

[103] See Eichenwald, supra note 99; Russ Choma, Donald Trump is Doing Business with a Controversial Azerbaijani Oligarch, Mother Jones (July 29, 2015), http://www.motherjones.com/politics/2015/07/donald-trump-azerbaijan-anar-mammadov [https://perma.cc/N762-NYUV]; Curt Devine, Drew Griffin & Nelli Black, Trump’s Business Partners Include Controversial Foreign Developers, CNN (Dec. 17, 2016), http://www.cnn.com/2016/12/15/politics/donald-trump-businesses-around-the-world/ [https://perma.cc/63GK-6J6J]; Jack Moore, Trump Organization Struck Deal with Azerbaijani Oligarch Tied to Iran’s Revolutionary Guard: Report, Newsweek (Mar. 6, 2017), http://www.newsweek.com/trump-organization-struck-deal-azerbaijani-oligarch-tied-irans-revolutionary-564387 [https://perma.cc/RF5S-KU3T].

[104] See Bill Clinton, Empowering People to Build Better Futures for Themselves, Their Families, and Their Communities, Clinton Found. (Aug. 22, 2016), https://www.clintonfoundation.org/blog/2016/08/22/empowering-people-build-better-futures-themselves-their-families-and-their [https://perma.cc/952L-FTDP].

[105] See Louis Nelson, What You Need to Know About Clinton and the Uranium One Deal, Politico (Nov. 14, 2017), https://www.politico.com/story/2017/11/14/hillary-clinton-uranium-one-deal-russia-explainer-244895 [https://perma.cc/J92Q-ZSR7].

[106] See id.

[107] See id.

[108] 18 U.S.C. § 208(a) (2012). There are other statutes that place limits on the executive branch such as 18 U.S.C. § 203, which prohibits execute branch employees from receiving any compensation for other matters before the executive branch. See 18 U.S.C. § 203 (2012).

[109] United States v. Miss. Valley Generating Co., 364 U.S. at 520, 548 (1961).

[110] United States v. Gorman, 807 F.2d 1299, 1303 (6th Cir. 1986).

[111] See Kevin Kelcourse, Conflicts of Interest, 26.3 Am. Crim. L. Rev. 713, 724 (1996).

[112] See id.

[113] See Justin Stern, A “Huge” Conflict of Interest? The Impact and Influence of President-Elect Trump’s Business Holdings, U. Miami L. Rev.: UMLR Insights (Dec. 2, 2016), http://lawreview.law.miami.edu/huge-conflict-interest-impact-influence-president-elect-trumps-business-holdings/ [https://perma.cc/57C4-X4GD]. On November 17, 2016, Congresswoman Katherine Clark introduced a bill that would extend conflict of interest law to the President and Vice President. See Matt Stone, U.S. Rep. Clark Targets Trump with Conflict-of-Interest Bill, Bos. Herald: Herald Bulldog (Nov. 17, 2016), http://www.bostonherald.com/news/local_coverage/herald_b

[114] See Norman L. Eisen, Richard Painter, & Laurence H. Tribe, The Emoluments Clause: Its Text, Meaning, and Application to Donald J. Trump 3 (2016), https://www.brookings.edu/wp-content/uploads/sites/17/2016/12/gs_121616_emoluments-clause1.pdf [https://perma.cc/9UB2-P2JS].

[115] See Laws that Do Not Apply to Congress (last visited Apr. 1, 2017), http://archives.democrats.rules.house.gov/Archives/jcoc2ai.htm [https://perma.cc/M5TS-4XQW]; Roger Parloff, Why Aren’t Donald Trump’s Epic Conflicts of Interest Illegal?, Fortune (Nov. 15, 2016), http://fortune.com/2016/11/15/donald-trump-conflicts-interest-ethics/ [https://perma.cc/QX44-3M4E]. Some scholars argue that the President’s position is unique and he cannot be prosecuted while in office without first being removed either by “impeachment, the voters, or the expiration of his term”—but this lacks both constitutional and legal authority. Susan Low Bloch, Can We Indict a Sitting President?, foreword to Ought a President of the United States Be Prosecuted, 2 Nexus 7 (1997); see also George E. Danielson, Presidential Immunity from Criminal Prosecution, 63 Geo. L. J. 1065, 1065 (1975). While the Constitution confers limited immunity from arrest to Senators and Representatives, no such privilege exists for the President. See id. In fact, the framers considered a presidential immunity provision, but rejected any such privilege. See id. According to Charles Pinckney, a delegate to the Constitutional Convention, “the framers expressly rejected any presidential privilege from arrest ‘because of [the framer’s] knowledge of the abuses that took place under the immunity from prosecution that existed in England.’” See id. The Supreme Court has, however, found that the President is protected from certain types of legal suites while in office. This includes immunity from civil liability stemming from his official acts. See Franklin v. Massachusetts, 505 U.S. 788, 801 (1992) (holding that the Administrative Procedure Act does not apply to the President); Nixon v. Fitzgerald, 457 U.S. 731, 749 (1982) (extending absolute immunity to the President from civil damage suits relating to official acts). But see Clinton v. Jones, 520 U.S. 681, 701–08 (1997) (refusing to extend presidential immunity from civil damage actions to misconduct that was not connected to official duties).

[116] Monica Langley, Why Donald Trump, as President, Wouldn’t Face Conflict-of-Interest Laws, Wall Street J. (July 4, 2016), http://www.wsj.com/articles/why-donald-trump-as-president-wouldnt-face-conflict-of-interest-laws-1467648595 [https://perma.cc/LX3T-AC85].

[117] Letter from Laurence H. Silberman, Att’y Gen., to the Chairman, Senate Comm. on Rules and Admin. (Sept. 20, 1974) (quoting Special Comm. on the Federal Conflict of Interest Laws, Ass’n of the Bar of the City of N.Y., Conflict of Interest and Federal Service (Bar Association Report), 1960 16–17, https://fas.org/irp/agency/doj/olc/092074.pdf [https://perma.cc/4UMW-MTRS].

[118] See David Orentlicher, Conflicts of Interest and the Constitution, 59 Wash. & Lee L. Rev. 713, 722 (2002).

[119] See supra Part I.A. It was not until a 1962 amendment that Congress’s financial conflict of interest statute explicitly exempted the President. See Clark, supra note 13.

[120] United States v. Miss. Valley Generating Co., 364 U.S. 520, 562 (1961).

[121] See Jonathan L. Entin, Congress, The President, and the Separation of Powers: Rethinking the Value of litigation, 43 Admin. L. Rev. 31, 31 (1991).

[122] A pure doctrine of separation of powers assigns unique functions to each branch and prohibits intrusion upon the functioning of any other branch. See id. at 36.

[123] See id. 

[124] See Letter from Laurence H. Silberman, Att’y Gen., to Hon. Howard W. Cannon, Chairman of Senate Comm. Rules and Admin. (Sept. 20, 1974), https://fas.org/irp/agency/doj/olc/092074.pdf [https://perma.cc/2WVD-6QP8].

[125] See Conflicts of Interest and the Presidency, CRS Legal Sidebar (Oct. 14, 2016), https://fas.org/sgp/crs/misc/conflicts.pdf [https://perma.cc/Z942-SXQ9].

[126] See C. Boyden Gray, Can Congress End Donald Trump’s Conflict of Interest Exemption?, N.Y. Times (Dec. 7, 2016), http://www.nytimes.com/roomfordebate/2016/12/07/can-congress-end-donald-trumps-conflict-of-interest-exemption[https://perma.cc/94W6-3GXS]. The Constitution sets out the requirements to be President, requiring a person to be a natural born citizen, at least 35 years old, and a resident within the United States for a minimum of 14 years. See id.

[127] See id.

[128] See M.C.E., Conflicts of Interest and the President: Reviewing the State of Law in the Face of a Trump Presidency, 4 Emory Corp. Governance & Accountability Rev. 47, 54 (2017), http://law.emory.edu/ecgar/content/volume-4/issue-special/essays-interviews/conflicts-president-law-trump-presidency.html [https://perma.cc/KW86-ACNL]. Unlike current bribery statutes, the Emoluments Clause does not require “the president actually take any reciprocating action to trigger the clause.” Id.

[129] See Stern, supra note 113.

[130] U.S. Const. art. I, § 9.

[131] See Stern, supra note 113. Article one, section nine is not enough to prevent conflicts, as Secretary Hillary Clinton’s foundation received tens of millions of dollars from foreign nations. See id.

[132] See  Zephyr Teachout, Trump’s Foreign Business Ties May Violate the Constitution, N.Y. Times (Nov. 17, 2016), http://www.nytimes.com/roomfordebate/2016/11/17/would-trumps-foreign-business-ties-be-constitutional/trumps-foreign-business-ties-may-violate-the-constitution [https://perma.cc/2JXW-3JVT]; Stern, supra note 113.

[133] This applies to any gifts from a foreign government. See M.C.E., supra note 128.

[134] See Eisen, Painter, & Tribe, supra note 114.

[135] See id.

[136] Id.

[137] Zephyr Teachout, Corruption in America: From Benjamin Franklin’s Snuff Box to Citizens United 2 (2014).

[138] See Cass R. Sunstein, Impeachment: A Citizen’s Guide 185–86 n.10 (2017); see also Jacob Pramuk, Two Attorneys General Sue Trump: Checks and Balances ‘Are Failing Us,‘ CNBC (June 12, 2017, 12:52 PM), https://www.cnbc.com/2017/06/12/emoluments-clause-trump-sued-by-maryland-and-dc-attorneys-general.html.

[139] Blumenthal, supra note 24.

[140] President Obama utilized a statutorily conflict-free investment. See Eisen, Painter, & Tribe, supra note 114.

[141] Id.; see also Shaub, supra note 72.

[142] See id.  

[143] See Rachel Stockman, Trump is Right, Conflict-of-Interest Rules Don’t Apply to Him, Law Newz (Nov. 23, 2016), http://lawnewz.com/high-profile/trump-is-right-conflict-of-interest-rules-dont-apply-to-him/ [https://perma.cc/N5N4-85HP]; Blumenthal, supra note 24; Richard Tofel, Emoluments Clause: Could Overturning 185 Years of Precedent Let Trump Off the Hook?, ProPublica (Dec. 13, 2016), https://www.propublica.org/article/emoluments-clause-overturning-185-years-of-precedent-let-trump-off-the-hook [https://perma.cc/BP5F-PAKC].

[144] Mr. Tillman is a lecturer in law at the National University of Ireland Maynooth.

[145] See Seth Barrett Tillman, Originalism & the Scope of the Constitution’s Disqualification Clause, 33 Quinnipiac L. Rev. 59, 98 (2014).

[146] See Stockman, supra note 143; Blumenthal, supra note 24.

[147] See id. at 100 n.103 (2014); Tofel, supra note 143 (noting that Washington never expressed his interpretation of the Emoluments Clause—Tillman is merely inferring Washington’s views from his silence). The Foreign Emoluments Clause only prohibited gifts from “any King, Prince, or foreign State.” U.S. Const. art. I, § 9, cl. 8. Both French officials were neither Kings nor Princes so the only question is if the gifts were considered from a foreign state. Marquis de Lafayette, who gave Washington the key, described the gift as “a tribute [w]hich I owe as [a] [s]on to [m]y [a]doptive father,” making it likely Washington viewed the gift from a close friend and not a French official. Letter from George Washington to the Marquis de Lafayette (Aug. 11, 1790), in 31 The Writings of George Washington 85 n.56 (John C. Fitzpatrick ed., 1939); see also Saikrishna Bangalore Prakish, Why the Incompatibility Clause Applies to the Office of the President, 4 Duke J. Const. L. & Pub. Pol’y Sidebar 38 (2008).

[148] See Neal Katyal & Richard Caplan, The Surprisingly Stronger Case for the Legality of the NSA Surveillance Program: The FDR Precedent, 60 Stan. L. Rev. 1023, 1078 (2008); see also Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 652 (1952) (Jackson, J., concurring) (noting that the limits on executive power are influenced by the “practical working of our Government”).

[149] See 24 Op. Att’y Gen. 116, 117 (1902).

[150] See U.S. Const. Art. I, § 9.

[151] Congress violates the separation of powers principle when an “Act prevents the Executive branch from accomplishing its constitutionally assigned functions, and only where the potential for disruption is present must it then be determined whether the impact is justified by an overriding need to promote objectives within Congress’ constitutional authority.” See Nixon v. Adm’r of Gen. Servs., 433 U.S. 425, 441–43 (1977).

[152]On the clause’s anti-corruption purpose, see Zephyr Teachout, The Anti-Corruption Principle, 92 Cornell L. Rev. 341, 361–62 (2009). Some scholars argue that the Emoluments Clause does not even extend to the President, and ask whether the Framers intended it only to apply to Congress or inferior officers. See Josh Blackman, Scalia in 1974 OLC Opinion: “Officer” in Constitution “Invariably Refers to Someone Other Than the President,“ Josh Blackman’s Blog (Dec. 22, 2016), http://joshblackman.com/blog/2017/01/11/the-originalist-analysis-about-the-emoluments-clause-from-president-elect-trumps-legal-team/. The Emoluments Clause prohibits conduct such as bribe-taking, but expanding it to all conflicts of interest is likely broader than its intended scope.

[153] See Jonathan Adler, The Emoluments Clause—is Donald Trump violating its letter or spirit?, The Volokh Conspiracy (Nov. 21, 2016), https://www.washingtonpost.com/news/volokh-conspiracy/wp/2016/11/21/the-emoluments-clause-is-donald-trump-violating-its-letter-or-spirit/?utm_term=.317d7998537a#comments [https://perma.cc/VH2V-AYNQ]. Based on Supreme Court precedent, standing may exist if a private party can prove a competitor received an unlawful benefit. See Ne. Fla. Chapter of Associated Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. 656, 666 (1993) (Thomas, J.) (“When the government erects a barrier that makes it more difficult for members of one group to obtain a benefit than it is for members of another group, a member of the former group seeking to challenge the barrier need not allege that he would have obtained the benefit but for the barrier in order to establish standing.”).

[154] See Bernard Condon, A Look at 5 Trump Business Ties That Pose Conflicts, Associated Press (Nov. 23, 2016), https://elections.ap.org/content/look-5-trump-business-ties-pose-conflicts [https://perma.cc/2XCR-4KPB]. For more on the issues with impeachment see infra Part III.D.A.1.

[155] See id.

[156] Id.

[157] See Shaub, supra note 72.

[158] Id. at 2.

[159] See id.

[160] Id.

[161] See id.

[162] U.S. Const. Art. I, § 8, cl. 18.

[163] See Charles N. Steel & Jeffrey H. Bowman, The Constitutionality of Independent Regulatory Agencies under the Necessary and Proper Clause: The Case of the Federal Election Commission, 4 Yale J. on Reg. 363, 369 (1987).

[164] See Eisen, Painter, & Tribe, supra note 114, at 22.

[165] See Title IV of the Ethics in Government Act of 1978, Pub. L. No. 95-521, 92 Stat. 1855–62 (1978); Office of Gov’t Ethics, Report to the President and to Congressional Committees on the Conflict of Interest Laws Relating to Executive Branch Employment (2006); Office of Gov’t Ethics, Report on Improvements to the Financial Disclosure Process for Presidential Nominees (2001).

[166] Office of Government Ethics, USA.Gov, https://www.usa.gov/federal-agencies/office-of-government-ethics [https://perma.cc/CMU6-8C93].

[167] See U.S. Office of Gov’t Ethics, U.S. Office of Government Ethics: Agency Profile 7–9, 11 (2005); Mission and Responsibilities, OGE.Gᴏᴠ, https://www.oge.gov/web/oge.nsf/Mission%20and%20Responsibilities [https://perma.cc/85VX-BGPA]. The Federal Election Commission has only six members, yet has exclusive jurisdiction over civil enforcement of federal campaign finance laws. See The FEC and the Federal Campaign Finance Law, http://www.fec.gov/pages/brochures/fecfeca.shtml [https://perma.cc/EY6T-5RWN].

[168] See 5 U.S.C. app. § 402. When OGE believes an official has violated the Standards of Ethical Conduct, it makes an informal recommendation to the employing agency to investigate the matter. See The Comm. on Fed. Legislation, Special Prosecutor Provision of the Ethics in Government Act of 1978, 36 Rec. Ass’n B. City N.Y. 420, 439 (1981). In the event this process is unsuccessful, OGE’s Director can then issue a nonbinding recommendation to the employing agency. See id.

[169] See id.

[170] See id.

[171] Title VI of the Ethics Act lapsed in 1999 and has now been replaced with 28 C.F.R. § 600. Section 600 provides that under certain circumstances the Attorney General may appoint Special Counsel to conduct a criminal investigation. See 28 C.F.R. § 600.1.

[172] See 5 U.S.C. app. § 402. The Ethics Act was aimed at eliminating the appearance of a conflict of interest, rather than particular crimes, thus Title VI is triggered whenever the President or Vice President is suspected of committing any non-petty federal crime. See Pub. L. No. 95-521, Title VI, 28 U.S.C. §§ 591–598; H.R. Conf. Rep. 95-1756 at 65 (1978).

[173] See The Comm. on Fed. Legis., supra note 168. At the conclusion of the investigation, the Attorney General reports to the United States Court of Appeals for the District of Columbia. See id. No special counsel will be appointed if the Attorney General’s conclusion is that the allegations are “so unsubstantiated that no further investigation is warranted. See Pub. L. No. 95-521, § 592(b). If the Attorney General concludes that further investigation is necessary or does not report to the court within 90 days, the Ethics Act requires that the court appoint a special prosecutor. See Staff of S. Comm. on Governmental Affairs, 95th Cong., Rep. on S. 555 (1977) at 52.

[174] See The Comm. on Fed. Legislation, supra note 168.

[175] The DOJ has not always retained exclusive control of selecting special counsel. Under Title VI of the Ethics in Government Act of 1978, a panel of three judges were also authorized to appoint a special counsel. See Ethics in Government Act of 1978, Pub. L. No. 95-521, 92 Stat. 1824; U.S. Const. art. II, § 2, cl. 2 (“Congress may by law vest the appointment of . . . [special prosecutors], as they think proper in the president alone, in the courts of law, or in the heads of departments.”) (The Attorney General still determined when an investigation was appropriate.); Morrison v. Olson, 487 U.S. 654, 661 (1988).

[176] One of OGE’s missions is to promote transparency in the executive branch. See OGE Promotes Transparence of the Executive Branch Ethics Program, OGE.Gov, https://www.oge.gov/web/oge.nsf/Mission%20and%20Responsibilities/595FC4A06573AE7C85257EA600655862?opendocument [https://perma.cc/JCS3-DPK2].

[177] “The Federal Election Commission is an agency that was designed to fail, and at that task, at least, it has succeeded brilliantly.” Michael M. Franz, The Devil We Know? Evaluating the Federal Election Commission as Enforcer, 8 Elec. L.J. 167, 167 (2009).

[178] 52 U.S.C. § 30101 (2012).

[179] 5 C.F.R. § 2634.403 (1996).

[180] 5 C.F.R. § 2634.402 (1997)

[181] 5 U.S.C. App. § 301. (2012)

[182] See Conflicts of Interest and the Presidency supra note 32, at 2.

[183] See 18 U.S.C. §§ 207–208 (2012) which lays out the same penalties for violating federal personal financial interest statutes.

[184] The blind trust must comply with 5 C.F.R. § 2634.402 (2012).

[185] The qualified blind trust would be created in accordance with current Ethics Act guidelines.

[186] See Peter Overby, 4 Questions About Donald Trump’s Potential Conflicts of Interest If He’s Elected, NPR: Morning Edition (June 9, 2016), http://www.npr.org/2016/06/09/481351291/if-elected-president-would-trump-put-his-investments-in-a-blind-trust [https://perma.cc/AZM3-BBWF].

[187] See U.S. Const. amend. V. The Fifth Amendment is not limited to real property, but extends to tangible and intangible property as well. See James W. Ely Jr., A Breather on the Takings Clause, 82 A.B.A. J. 42, 45 (1996).

[188] 438 U.S. 104 (1978).

[189] Id. at 538–39.

[190] 260 U.S. 393 (1922).

[191] See id; Ely, supra note 187, at 44 (noting a 1995 Texas law that permits challenges to the regulation if property value is decreased by more than 25 percent); see also United States v. Dickinson, 331 U.S. 745, 748 (1947) (“Property is taken in the constitutional sense when inroads are made upon an owner’s use of it to an extent that, as between private parties, a servitude has been acquired either by agreement or in course of time.”).

[192] See Dolan v. City of Tigard, 512 U.S. 374, 384 (1994); Ely, supra note 187 at 44.

[193] See Ely, supra note 187, at 44.

[194] See Village of Euclid v. Ambler Realty Co., 272 U.S. 365 (1926) (holding that a zoning regulation that caused a 75 percent decrease in property value was constitutional because it was not “clearly arbitrary and unreasonable, having no substantial relation to the public health, safety, morals, or general welfare); Pruneyard Shopping Ctr. v. Robins, 447 U.S. 74, 84 (1980) (concluding no taking existed when a shopping center “failed to demonstrate that the ‘right to exclude others’ is so essential to the use or economic value of [its] property that the state-authorized limitation of it amounted to a taking”).

[195] See United States v. Sioux Nation Indians, 448 U.S. 371, 452 (1980); Fort Berthold Reservation v. United States, 390 F.2d 686, 693 (Ct. Cl. 1968) (reasoning that when Congress acted as both a sovereign and trustee, no compensation was due if good faith was employed).

[196] See supra Part II.B

[197] See U.S. Const. amend. V.

[198] See id.

[199] See U.S. Const. amend. XXVII; Eric Posner, The U.S. Constitution is Impossible to Amend, Slate (May 5, 2014), http://www.slate.com/articles/news_and_politics/view_from_chicago/2014/05/amending_the_constitution_is_much_too_hard_blame_the_founders.html [https://perma.cc/QEX5-893K].

[200] David A. Strauss, The Irrelevance of Constitutional Amendments, 114 Harv. L. Rev. 1457, 1459 (2001).

[201] See supra Part II.C.1.B.

[202] See supra Part II.B.

[203] See Eisen, Painter, & Tribe, supra note 114.

[204] 2 Records of the Federal Convention of 1787, at 600 (Max Farrand ed., rev. ed. 1937).

[205] See Michael J. Gerhardt, Putting the Law of Impeachment in Perspective, 43 St. Louis U. L.J. 905, 909 (1999).

[206] Neal K. Katyal, Impeachment as Congressional Constitutional Interpretation, 63 Law & Contemp. Probs. 169, 181 (2000). Clinton was impeached by the House on two charges: perjury and obstruction of justice. See Alison Mitchell, The President’s Acquittal: The Overview; Clinton Acquitted Decisively: No Majority for Either Charge, N.Y. Times (Feb. 13, 1999). He was acquitted by the Senate. See id.

[207] See Thomas R. Lee, The Clinton Impeachment and the Constitution: Introduction to the Federalist Society Panel, 1999 BYU L. Rev. 1079, 1082–83 (1999).

[208] See Teachout, supra note 137.

[209] See Stockman, supra note 143; Isaac Arnsdorf, Trump Could Keep D.C. Hotel Despite Conflict of Interest, Politico (Dec. 3, 2016), http://www.politico.com/story/2016/12/trump-could-keep-dc-hotel-despite-conflict-of-interest-232144 [https://perma.cc/5N4V-BQHJ]; Larry Buchanan & Karen Yourish, The Array of Conflicts of Interest Facing the Trump Presidency, N.Y. Times (Dec. 22, 2016), http://www.nytimes.com/interactive/2016/12/01/us/politics/trump-conflict-of-interests.html [https://perma.cc/P9CY-RN3M].

[210] It could be a stretch to view these as bribes rather than an exchange of goods for services. For example, if Trump’s hotel rooms were valued at $100 a night, it would not be a bribe, gift, or present to rent the room for $100. It is also unlikely that he would be influenced by renting the room out for $100. Although, even at $100 a night, the exchange may be seen as a bribe if Trump were to rent the room to a diplomat in exchange for political favors. It would be more concerning, however, if Trump accepted $180 a night for that same room.

[211] There is debate on what exactly constitutes a bribe. See Judy Nadler & Miriam Schulman, Gifts and Bribes, Santa Clara U. (July 1, 2016), https://www.scu.edu/ethics/focus-areas/government-ethics/resources/what-is-government-ethics/gifts-and-bribes/ [https://perma.cc/A6CF-4CKV]. To avoid a Emolument Clause issue, Trump proposed donating any profits he made from foreign governments at his hotels to the United States Treasury so that “it is the American people who profit”—however, if Trump was in violation of the Clause this would not rectify it. See Sara Begley, Donald Trump to Donate Money Foreign Governments Spend at His Hotels to U.S. Treasury, Time (Jan. 11, 2017), http://time.com/4631595/donald-trump-hotels-treasury-foreign-government/ [https://perma.cc/P5CU-SMB7] (statement by Sheri Dillon, an attorney who has worked with the Trump team to structure his assets); Darla Mercado, Trump Says He’ll Donate Some Profits to the Treasury—And So Can You, CNBC (Jan. 11, 2017), http://www.cnbc.com/2017/01/11/trump-says-hell-donate-some-profits-to-the-treasury–and-so-can-you.html [https://perma.cc/X6G6-54QA].

[212] Andrew Johnson and Bill Clinton have more than just their impeachment acquittal by the Senate in common—both of their proceedings were divided along party lines. See Keith E. Whittington, Bill Clinton Was No Andrew Johnson: Comparing Two Impeachments, 2 U. Pa. J. Const. L. 422, 424 (2000).

[213] For example the Democrats proposed a resolution that would force disclosure of Trump’s potential conflicts of interest and ties to Russia. See H.R. Res. 286, 110th Cong. (2017). The Republican-controlled House of Representatives voted down this resolution, stifling the Democrats attempt to obtain records from the Justice Department regarding Trump’s ties to Russia. See Stephen Ohlemacher, Correction: Congress-Trump Taxes Story, AP (Feb. 15, 2017), http://bigstory.ap.org/418d4c32d280412aba4f64711950b4e3 [https://perma.cc/UHM3-EKYN].

[214] Often special prosecutor, independent counsel, and special counsel are used interchangeably. All three rely on the Attorney General to initiate investigations. It should be noted, that special prosecutors and independent counsel technically refer to a now expired provision of the Ethics in Government Act of 1978. See Cynthia Brown, Cong. Research Serv., R44857, Special Counsels, Independent Counsels, and Special Prosecutors: Options for Independent Executive Investigations 1 (2017). 

[215] See Jack Maskell, Cong. Research Serv., R43112, Independent Counsels, Special Prosecutors, Special Counsels, and the Role of Congress 2 (2013). Congress may participate in creating new statutory requirements for the appointment of a special prosecutor as it did in title VI of the Ethics in Government Act of 1978. See id.

[216] See Frank M. Tuerkheimer, The Executive Investigates Itself, 65 Calif. L. Rev. 597, 602 (1977).

[217] Although special counsel conduct investigations, the Attorney General is the one who determines whether or not to begin an investigation. See Kenneth Culp Davis, Discretionary Justice: A Preliminary Inquiry 188, 207–08 (1960) (“The affirmative power to prosecute is enormous, but the negative power to withhold prosecution may be even greater.”).

[218] A special counsel’s investigation may also impact the Attorney General. For example, Trump has criticized sessions ever since he recused himself from the Russia campaign. After Sessions appointed Mueller, Trump accused the Attorney General of “disloyalty,” leading Sessions to offer his resignation (which ultimately was not accepted). See Michael S. Schmidt & Maggie Haberman, Trump Humiliated Jeff Sessions After Mueller Appointment, N.Y. Times (Sept. 14, 2017), https://www.nytimes.com/2017/09/14/us/politics/jeff-sessions-trump.html [https://perma.cc/KBN9-B7DB].

[219] Comey refused to drop the investigation into Trump’s former national-security adviser Michael Flynn.

[220] Sessions cited involvement with the Trump campaign. See Ryan Teague Beckwith, Read Attorney General Jeff Sessions’ Remarks on Recusing Himself, Time (Mar. 2, 2017), http://time.com/4689524/jeff-sessions-recuse-russia-trump-transcript/ [https://perma.cc/5MX9-5ZJX].

[221] See Abby Phillip & Sari Horwitz, Trump Blasts AG Sessions for Recusing Himself From the Russia Probe, Wash. Post (July 19, 2017), https://www.washingtonpost.com/news/post-politics/wp/2017/07/19/trump-blasts-ag-sessions-for-recusing-himself-from-the-russia-probe/?utm_term=.7d07ce63f48e [https://perma.cc/C2ZH-FR27].

[222] Trump suggested that Mueller had a conflict of interest because Mueller interviewed for Comey’s job days before his appointment as special counsel. See Carrie Johnson, Special Counsel Robert Mueller Had Been on White House Shortlist to Run FBI, NPR (June 9, 2017), https://www.npr.org/2017/06/09/532286723/special-counsel-robert-mueller-had-been-on-white-house-short-list-to-run-fbi?live=1 [https://perma.cc/5K96-J2B4]; Graham Lanktree, New Legislation to Protect Russia Investigation’s Robert Mueller from Trump, Newsweek (Sept. 15, 2017), http://www.newsweek.com/new-law-protect-russia-investigations-robert-mueller-trump-665565 [https://perma.cc/Z2RY-UNGX]. Several members of Muller’s team were accused of having ideological conflicts of interest. These potential conflicts include donations to the Obama and Clinton campaigns and previously representing the Clinton Foundation. See Scott Shane & Charlie Savage, Muller, Known for Being Above the Fray, Is Now in the Thick of It, NY Times (June 15, 2017), https://www.nytimes.com/2017/06/15/us/politics/robert-mueller-special-counsel.html [https://perma.cc/7AUY-UHYT].

[223] See H. Rep. 115-28 (2017).

[224] See Jackie Wattles, Deutsche Bank Finalizes $7.2 Billion Settlement, CNNMoney (Jan. 17, 2017), http://money.cnn.com/2017/01/17/news/economy/deutsche-bank-fine/ [https://perma.cc/YCJ5-A8HX].

[225] See Chris Arnold, DOJ’s Big Bank Settlements Remove Potential Conflict of Interest for Trump, NPR (Dec. 23, 2016), http://www.npr.org/sections/thetwo-way/2016/12/23/506720254/dojs-big-bank-settlements-remove-potential-conflict-of-interest-for-trump [https://perma.cc/S3DX-L9CK].

[226] See AP, Trump Says “The President Can’t Have a Conflict of Interest” – Is He Right?, CBS (Nov. 23, 2016), http://www.cbsnews.com/news/what-trump-meant-when-he-said-the-president-cant-have-a-conflict-of-interest/ [https://perma.cc/HR2D-ZG6H].

[227] See S. Rep. No. 95-170, at 21 (1977), at 2; Watergate Special Prosecution Force Report (1975). If upon completion of a preliminary investigation it is determined further investigation is necessary, the matter is referred to the court for a special prosecutor to be assigned. See S. Rep. No. 95-170, at 2.

[228] See Morrison v. Olson, 487 U.S. 654, 711 (1988) (Scalia, J., dissenting).

[229] See supra Part II.C.1.

[230] See Morrison, 487 U.S. at 711 (Scalia, J., dissenting).

[231] Id.

[232] See id. at 691.

[233] Id.

[234] 839 F.3d 1 (D.C. Cir. 2016) (finding the CFPB’s leadership structure unconstitutional). In 2018, the D.C. Circuit reversed its 2016 decision and found that the CFPB’s structure was constitutional. 

[235] See id.

[236] Id. at 20.

[237] See PHH Corp. v. Cons. Fin. Protection Bureau, 881 F.3d 75, 79 (D.C. Cir. 2018) (“The CFPB’s authority is not of such character that removal protections of its Director necessarily interferes with the President’s Article II duty or perogative.”).

[238] See Abraham Dash, The Office of Independent Counsel and the Fatal Flaw: “They are Left to Twist in the Wind,” 60 Md. L. Rev. 26, 33 (2001).

[239] See id.

[240] See id.

[241] The Special Counsel Independence Protection Act, introduced by Senators Lindsey Graham (R-S.C.) and Cory Booker (D-N.J.), and The Special Counsel Integrity Act, proposed by Senators Chris Coons (D-Del.) and Thom Tillis (R-N.C.), would permit special counsel to challenge their removal in federal court. See S. 1735, 115th Cong. (hearing held in Senate’s Committee on the Judiciary, Sept. 26, 2017); S. 1741, 115th Cong. (hearing held in Senate’s Committee on the Judiciary, Sept. 26, 2017).

[242] A special counsel may only be removed “by the personal action of the Attorney General and only for good cause.” See 28 C.F.R. § 600.7(d) (2012).

[243] See Excerpts From the Time’s Interview With Trump, N.Y. Times (July 19, 2017), https://www.nytimes.com/2017/07/19/us/politics/trump-interview-transcript.html [https://perma.cc/CEM9-3FVZ]. (Trump answered affirmatively when asked if looking at his “finances and [his] family finances, unrelated to Russia . . . [was] a red line.” Trump elaborated that this would constitute a “violation” by Mueller.).

[244] Conflicts of Interest Laws, 15 Rec. Ass’n B. City N.Y. 180, 196 (1960).

Don’t Hold Your Breath: Furthering the Fight Against Drunken Driving Until Autonomous Vehicles Arrive

By Russell Spivak, JD ’17[*]

Interlocking Ignition Devices (IIDs) restrict a driver from turning on a car unless he or she passes a Breathalyzer examination. There is significant reason to think that promoting—if not mandating—the installation of such technologies in all cars, regardless of their drivers’ drinking habits or driving records, would lead to a substantial decline in auto accidents, along with a commensurate recapture of economic value. This Article explicates why this life-saving technology has not been more widely adopted already. It then offers a few potential levers by which federal or state governments can induce or compel the adoption of these life-saving devices within the confines of administrative law and the strictures of federalism. Finally, the Article briefly details a few pragmatic issues associated with inducing the adoption of IIDs, including 4th Amendment concerns and the auto insurance industry’s response.

 

Introduction

It is possible that autonomous cars will be ubiquitous by the time today’s tweens get behind the wheel.[1] But to paraphrase Mark Twain, reports of human-operated cars’ death may be exaggerated.[2] Until that day comes, however, we must continue to navigate the roads ourselves, and face the perils of drivers’—including our own—human error. At the forefront of such perils is drunk driving. In spite of the tremendous work done by law enforcement and non-profit organizations—not to mention the unsung heroes that steal their friends’ keys—who try to combat this danger, “[i]n 2015, 10,265 people died in alcohol-impaired driving crashes, accounting for nearly one-third (29%) of all traffic-related deaths in the United States.”[3] In other words, “28 people in the United States die[d] in motor vehicle crashes that involve an alcohol-impaired driver” daily. On average, one such death occurred every 53 minutes.[4] To put this number in perspective, firearms took only 20% more lives than drunk driving the year before.[5] Yet the ongoing and fervent debate regarding gun control far outpaces its drunk driving equivalent.

The next logical question must be: are we really putting a proportional amount of effort and legislative focus into staving off drunk driving-related deaths? It seems unlikely. This article seeks to begin rectifying that shortfall, bridging the gap between today’s reality and tomorrow’s autonomous protections.

Luckily, this article is not alone in its pursuit of interim solutions. In 2008, the National Highway Traffic Safety Administration (NHTSA) and the Automotive Coalition for Traffic Safety began researching

potential in-vehicle approaches to the problem of alcohol-impaired driving. . . . This cooperative research partnership, known as the Driver Alcohol Detection System for Safety (DADSS) Program . . . is developing non-intrusive technologies that could prevent the vehicle from being driven when the device registers that the driver’s blood alcohol concentration (BAC) exceeds the legal limit[.][6]

After investing $2.25 million to research promising non-intrusive technologies,[7] DADSS zeroed in on “two different technologies for vehicle integration: a breath-based system and a touch-based system.”[8] The former is essentially an ambient breathalyzer: it reads alcohol levels in the driver’s exhaled air without requiring him to blow into a specific tube. The latter measures BAC by detecting alcohol just below the surface of one’s skin via infrared light.[9] “The National Highway Traffic Safety Administration in the U.S. is hoping the new equipment will be ready for roll-out by 2020.”[10] Recent technological advances like the above offer renewed hope for exceptional accuracy as well as more space-efficient machinery.[11] Furthermore, they are designed to be more proactive in avoiding drunk driving and saving lives. Both of these technologies are part of the larger family of Interlocking Ignition Devices (IIDs), which prevent the operator of a car from starting the car if he or she fails a breathalyzer test.

IIDs are not new: they were developed in the latter half of the 20th century. They have gained near-universal favorability across the country[12]: all 50 states and Washington, D.C. use IIDs in some fashion when convicted DUI drivers seek to return to the roads.[13] Other countries have followed suit.[14]

It is time to rebrand this technology not as solely punitive, but as preventive. While the NHTSA Report expressed skepticism about the current feasibility of installing IID technology, it nevertheless made clear that the IID is the future of auto safety.[15] What is more, with proper forethought, solutions to compel IIDs’ uptake can stay current with new technology: states need only update their statutes defining IIDs to include the new devices. Scientists who have studied the effects of IID installation have recommended putting such devices in newly manufactured cars.[16]

So here’s the $64,000 question: how can governments pave the way for the universal adoption of IIDs? This Article explores just that.

To begin, the Article looks at a history of drunk driving in the United States and early efforts to combat this all-too-preventable killer. Section II zeroes in on drunk driving today: its demographics and, particularly, its costs. Section III explains IIDs in more detail, from their technological underpinnings to their use today. Section IV details strategies for implementation within and without the tax code. Section V denotes certain additional considerations that may come to bear on the debate. Finally, the article concludes by recommending particular strategies to incentivize adoption of IIDs, thereby saving lives.

 

I. A Brief History of Drunk Driving and Responses Thereto

In 1906, New Jersey became the first state in the Union to enact legislation outlawing drunk driving.[17] Its violation—which did not articulate a specific blood alcohol content (BAC)[18]—was punishable by $500 or potential jail time.[19] This was typical of early drunk driving laws, which “made it illegal to drive while intoxicated but did not provide a statistical definition of intoxication. As a result, prosecutors normally had to present testimony that the defendant was showing outward signs of intoxication, like imbalance or slurred speech.”[20]

In the 1930s, as driving’s popularity increased and drunk driving became an increasingly pressing issue, “a number of medical men and other scientists in this country became intensely interested in the problem of the drinking driver upon our highways and the use of chemical tests to determine alcoholic influence as one of the means of coping with it.”[21]

It was not until 1938, however, that two national institutions sought to better codify what it meant to operate under the influence of alcohol. The American Medical Association teamed up with the National Safety Council to issue a report in an effort to make DUI-related laws more uniform. The report stated that:

• Below 0.05 percent alcohol in the blood: no influence of alcohol within the meaning of the law.
• Between 0.05 and 0.15 percent, a liberal, wide zone: alcoholic influence usually is present, but courts of law are advised to consider the behavior of the individual and circumstances leading to the arrest in making their decision.
• 15 percent [or above]: definite evidence of “under the influence”, since every individual with this concentration would have lost to a measurable extent some of the clearness of intellect and control of himself that he would normally [have].[22]

Shortly afterwards, “[i]n 1939, Indiana enacted the first law that defined presumptive intoxication based on BAC levels, using the recommended 0.15% standard. Other States soon followed and then, in response to updated guidance from national organizations, lowered the presumption to a BAC level of 0.10%.”[23]

At the federal level, however, nothing was done to combat drunk driving until Congress passed the Highway Safety Act of 1966.[24] The State Highway Safety Program, commonly referred to as Section 402, was initially authorized by the Act; Section 402 offers grants to states for “[s]tate highway safety programs, designed to reduce traffic crashes and resulting deaths, injuries, and property damage.”[25] However, legislative—and non-legislative—efforts to curb drunk driving only began in earnest “[d]uring the early 1980s, [as] citizens across the country began demanding an end to this waste of human life.”[26] Concerned citizens formed Mothers Against Drunk Driving (MADD) in 1980.[27] MADD was aided in part by its youth counterpart, SADD, or Students Against Drunk Driving, which was founded in 1981. MADD focused much of its efforts on political activism, while SADD rose to prominence via peer-to-peer education, aiming to dovetail with MADD’s successes by attacking the problem from a complementary angle.

But citizen activists were not alone in the fight: in 1982, Congress created the Traffic Safety Information System Improvement Grant Program, otherwise known as the Section 408 Program.[28]

To qualify for a basic grant under the Section 408 program, states were required to meet four criteria, including the enactment of a .10 BAC per se law.[29] States that qualified for basic grant funds could qualify for supplemental grants based on additional criteria, including the enactment of a .08 per se law.[30]

Two years later, it passed the National Minimum Drinking Age Act, which required states to pass individual legislation to raise the drinking age to 21.[31] Four years after that, Congress instituted additional grants with criteria and purpose similar to Section 408.[32]

Unsurprisingly, “729 changes in laws were made in an effort to reduce fatal crashes involving drunken drivers” from 1981 through 1986: some jurisdictions enacted new laws, while others merely ratcheted up existing ones.[33] In addition, these laws came in all shapes and sizes, ranging from administrative regulations that authorized license suspensions and civil penalties to criminal per se laws that carried severe criminal penalties.[34] These laws showed a marked effect: for example, “[c]riminal per se laws against drunken driving and increased penalties were each accompanied by 6-percent declines in night fatal crashes relative to States that did not pass such laws.”^[35]

The federal government continued to combat drunk driving in the 1990s. It passed a flurry of resolutions to declare a national week[36]—or month[37]—in recognition of the fight against drunk driving as well as multiple substantive laws addressing the problem. The Drunk Driving Victims’ Protection Act prevented bankruptcy courts from discharging debt arising from a DUI-based judgment.[38] The Violent Crime Control and Law Enforcement Act of 1994 subjected drunk drivers to harsher penalties if they committed the act with a child in the car.[39] In 1998, Congress “authorized $500 million in incentive grants to states that adopt .08 BAC laws.”[40] And in 2000, after publicly championing the fight against drunk driving throughout his presidency,[41] President Clinton signed legislation to institute a national minimum standard of .08 BAC for drunk-driving laws.[42] Today, all fifty states criminalize driving with .08 g/dL BAC, though “specific laws and penalties vary substantially from state to state.”[43] Unfortunately, progress appears to have stalled. In 2013, the National Transportation Safety Board recommended that all states lower their legal limit from .08 to .05, [44] but the Bush and Obama Administrations continued to fund the grant programs as is. Furthermore, no state has yielded to the NTSB’s recommendation.[45]

Interestingly, the private sector has tried to offer solutions, too. After the turn of the century, technology gave rise to one interesting wave of anti-drunk driving strategies: ride sharing. Proponents of ride sharing argued that companies like Uber and Lyft could effectively combat drunk driving by offering more widely-available sober alternatives.[46] One (unpublished) study found that these services have had a statistically significant effect.[47] A more recent study, however, claims otherwise.[48] The authors of the latter study suggested some potential causes for their findings: the supply of drivers may not have been large enough to have a statistically significant effect; ride-sharing’s primary users may not own a vehicle, meaning they would not otherwise drive, drunk or not; or, said primary users would have otherwise called a taxi anyway.[49] The scarier—and more unfortunate—cause may be that despite the existence of ride-sharing programs, individuals nevertheless believe the risk of getting caught or getting into an accident while driving drunk is so low that they remain undeterred and pick up their keys after their bar tab.[50] Discussing the study’s findings, a Washington Post reporter summed it up best: “Drunks, after all, are just not rational.”[51]

As a result of this progression, DUI-related deaths decreased dramatically through the end of the 20^th century. In 1982, drunk driving deaths hit 21,113, steadily declining until 1999 at 12,555. After a few years hovering around that mark, the fatalities dropped again through 2011 to its lowest mark, 9,865. Since then, however, that figure has plateaued. The universal installation of IIDs can resume the decline towards zero drunk driving deaths.

 

II. Drunk Driving’s Effects Today

A. Demographics

“In 2014, there were 9,967 fatalities in motor vehicle traffic crashes involving a driver with a BAC of .08 g/dL or higher; this was 31 percent of total traffic fatalities for the year.”[52] Unsurprisingly, the demographics of those behind the wheel in alcohol-impaired crashes trend towards younger drivers, particularly males:

In fatal crashes in 2014, the highest percentage of drivers with BACs of .08 g/dL or higher was for 21- to 24-year-old drivers (30%), followed by 25- to 34-year-old drivers (29%). The percentage of drivers with BACs of .08 g/dL or higher involved in fatal crashes was 23 percent among males and 15 percent among females. In 2014, there were 4.5 male alcohol-impaired drivers for every female alcohol-impaired driver (7,574 versus 1,671).[53]

Unfortunately, the NHTSA does not give a detailed breakdown of the demographic information of drunk-driving victims. But it does leave us with one particularly chilling thought:

In 2014, a total of 1,070 children 14 and younger were killed in motor vehicle traffic crashes. Of these 1,070 fatalities, 209 children (19%) died in alcohol-impaired-driving crashes. Of these 209 child deaths: 116 (56%) were occupants of vehicles with drivers who had BACs of .08 g/dL or higher; 61 (29%) were occupants of other vehicles; 30 (14%) were nonoccupants (pedestrians, pedalcyclists, or other nonoccupants)[.][54]

This stark reality alone should be enough to prompt significant action to curb drunk driving.

 

B. Costs

In its most recent study of the costs of alcohol-involved crashes in the United States, the Department of Transportation’s National Highway Transportation Safety Administration concluded that, “[o]verall, alcohol involved crashes cost $52 billion in economic costs in 2010[.]”[55] Even though “not all crashes in which alcohol was present were caused by alcohol,”[56] it is still true that:

Crashes in which alcohol was the cause resulted in 11,226 fatalities, 326,000 nonfatal injuries, and $43.2 billion in economic costs. This is approximately 84 percent of the alcohol-related fatalities and 82 percent of alcohol-related economic costs. It represents 34 percent of all fatalities and 18 percent of all costs from motor vehicle crashes.[57]

The report also found that crashes involving alcohol account for a disproportionate percentage of fatalities in automobile incidents.[58] Additionally, the report’s cost estimates reflect the gender disparities in perpetrators of drunk driving accidents mentioned above[59] as well as the fact that most victims tend to be younger, meaning the cost of death—or even lost productivity—is higher.[60] But these costs are only the “economic costs,” defined as:

The monetary impact of traffic crashes resulting from goods and services expended to respond to the crash, treat injuries, repair or replace damaged property, litigate restitution, administer insurance programs, and retrain or replace injured employees. Economic costs also include the health and environmental impacts that result from congestion, the value of workplace and household productivity that is lost due to death and injury, and the value of productivity and added travel time that is incurred by uninvolved motorists due to congestion from traffic crashes.[61]

That means that these estimates do not include the value of a statistical life! When factoring in values associated with quality of life as well as the statistical value of life,[62] the total value of societal harm from alcohol-induced motor vehicle incidents is $236 billion,[63] while “[c]rashes in which alcohol was the cause resulted in $194 billion in societal harm in 2010.”[64]

 

III. Interlocking Ignition Devices

Because IIDs are traditionally only required for people who have already been convicted of a drunk driving offense, readers who do not have a direct connection with drunk driving may be unfamiliar with them. Therefore, this section of the Note first aims to inform readers about how IIDs work, their current usage across the country, how Congress has previously toyed with their adoption, and how deploying them more broadly would affect our country.

 

A. How IIDs Work and Where They Are Currently Deployed

As stated earlier, all 50 states implement IIDs in some way, shape or form in drunk-driving punishments.

Broadly speaking, these laws fall into three categories. “Permissive” interlock laws allow judges or other sentencing authorities, at their discretion, to require individuals convicted of DUI offense to use an interlock. “Partial” laws mandate interlock use for specific categories of offenders, such as repeat DUI offenders. “Mandatory/all” laws require all individuals convicted of a DUI offense to use an interlock in order to drive legally. As of March 2016, two states have permissive interlock laws, 22 states have partial interlock laws, and 26 states have mandatory/all interlock laws. Adoption of interlock laws was partly prompted by enactment of a 2000 federal law that provided financial incentives for states to enact interlock laws.[65]

But how do they work?

For all intents and purposes, IIDs are in-car breathalyzers. “First, the device is installed in the vehicle (typically in the glove compartment on the passenger’s side). It is then hardwired to the engine’s ignition system.”[66] Then, “[t]he driver must provide a breath sample below a State-established calibration setting (called a set point) to start the vehicle. Most States use a calibration setting of .02 blood alcohol concentration.”[67] Additionally, the devices are equipped with pressure and temperature gauges to prevent cheating the test by spraying compressed air from an outside source instead of breathing into the device.[68] Finally, all IIDs are required to pass NHTSA’s standards,[69] regulating their accuracy and thus efficacy.

To be fair, there is an inherent flaw in the product: the device cannot know who is performing the test.[70] Unfortunately, this means a sober passenger could perform the test in lieu of a drunken driver. Technically speaking, there is not yet a perfect solution for this problem,[71] but attaching camera systems to IIDs is a good start that is currently underway.[72] States criminalize cheating IIDs, either via tampering with the device or otherwise circumventing it.[73] More practically, logic dictates that individuals sober enough to pass the test have little incentive to cheat a breathalyzer on behalf of a drunk driver, thereby risking their own safety in the process. Though this is a problem, perfection should not prohibit progress.

 

B. A Brief History of the Federal Government’s Interest in IIDs

IIDs are not new to Congress. In 1970, the

National Highway and Traffic Safety Administration issued a prospectus entitled ‘Some Considerations Related to the Development of an Alcohol Safety Interlock System (ASIS)’ . . . to organizations who have previously expressed an interest in this subject. . . . A letter accompanying the prospectus, requested (1) descriptions of potential ASIS, (2) a discussion of the possible solutions to problems mentioned, and (3) a description of the responding firms experience and capabilities in the area of interest.[74]

Studies throughout the 1970s repeatedly demonstrated technological insufficiency: early versions of the IID were too inaccurate for viability.[75] Yet by 1988, the Department of Transportation reported to Congress that breathalyzer technology for IIDs was “feasible” for large-scale implementation and deployment.[76]

Since that time, Congress has repeatedly looked to IIDs, particularly to deter repeat offenders in drunk driving cases.[77] But, to be certain, Congress is well aware of the role IIDs can play in combatting drunk driving more broadly.

 

C. Cost Savings Via Installation

Many scientific studies have discussed the role IIDs can—and do—play when states mandate their use. These studies universally concluded that, as one commentator summarized, “[w]hen installed, interlocks can reduce DUI recidivism.”[78] One study found that introduction of IID laws was “effective in reducing recidivism by a median of 67 percent.”[79]

But in 2014, scientists looked beyond the scope of punitive IID use to estimate the effects associated with installing IIDs in all new vehicles purchased in the United States, regardless of the driver’s past actions.[80] In particular, the study endeavored to assess the injury prevention impact and the subsequent cost savings in such a scenario. It first looked to states that enacted punitive IID laws for DUI convictions during a 15-year time period, measuring the natural experiment’s impact on fatalities in alcohol-related motor vehicle crashes.[81] Given the measured changes, the study concluded that installing IIDs in all new cars “would result in a total of 59,554 lives saved and 1.25 million nonfatal injuries prevented over 15 years.”[82] Putting that in economic terms, IID’s universal usage would “decrease the economic cost of fatal injuries by $260 billion and nonfatal injuries by $83 billion, totaling almost $343 billion in savings.”[83] Said another way, for every $1.00 spent in enforcement, $6.60 would be saved in medical and life costs.[84]

Even more impressive were the projected cost-savings over time:

Assuming the cost of a device is $400/vehicle and the interlocks function correctly 100% of the time, the injury cost benefit outweighs the device per vehicle cost after 3 years. As device effectiveness decays . . . a greater number of years is required to achieve the same level of cost savings; however, universal implementation remains cost effective within the 15-year implementation time period until the effectiveness passes below 25%.[85]

Recognizing the cost-benefit favorability of universal installation, the scientists also identified “[s]everal barriers to . . . wider implementation”: technological deficiencies—although improved IIDs are currently being developed—and insufficient public awareness of IIDs’ existence.[86] Below are strategies to cure both of these problems.

 

IV. Strategies to Incentivize IID Usage

This section expounds on the strategies that can be taken to induce IID usage, breaking strategies up by whether they are specific to the federal government, state governments, or could be undertaken by either.

 

A. Federal-Specific Strategies to Induce IID Uptake

There are a few strategies that can realistically only be taken up at the national level: specifically, regulating the installation and usage of IIDs in automobile manufacturing.[87] Three strategies stand out: mandating breathalyzers generally while encouraging IIDs, mandating IIDs, and leveraging highway financing to induce states. As demonstrated below, either strategy involving regulating breathalyzers or IIDs is plainly within the National Highway Transportation Safety Agency’s jurisdiction.[88] All three measures are ultimately recommended, as any could help achieve the policy goal of increasing usage and thus reducing drunk-driving accidents.

i. Mandate Breathalyzers While Permitting IIDs in Automobiles

Short of mandating IIDs in every car, the Secretary of Transportation can mandate installing breathalyzers in cars to encourage their use, even if they are unconnected to the ignition system, while permitting IIDs to satisfy this requirement. As Justice Byron White explained,

[i]n 1966, Congress decided that [part of preventing car accidents] lies in improving the design and safety features of the vehicle itself. But much of the technology for building safer cars was undeveloped or untested. Before changes in automobile design could be mandated, the effectiveness of these changes had to be studied, their costs examined, and public acceptance considered. This task called for considerable expertise and Congress responded by enacting the National Traffic and Motor Vehicle Safety Act of 1966 (Act). The Act, created for the purpose of “reduc[ing] traffic accidents and deaths and injuries to persons resulting from traffic accidents,” directs the Secretary of Transportation or his delegate to issue motor vehicle safety standards that “shall be practicable, shall meet the need for motor vehicle safety, and shall be stated in objective terms.” In issuing these standards, the Secretary is directed to consider “relevant available motor vehicle safety data,” whether the proposed standard “is reasonable, practicable and appropriate” for the particular type of motor vehicle, and the “extent to which such standards will contribute to carrying out the purposes” of the Act.[89]

Motor vehicle safety standards, officially known as Federal Motor Vehicle Safety Standards (FMVSS),[90] are designed under three overarching themes: crash avoidance, crashworthiness, and post-crash standards.[91] They are written

in such a manner that the public is protected against unreasonable risk of accidents occurring as a result of the design, construction or performance of motor vehicles and is also protected against unreasonable risk of death or injury to persons in the event accidents do occur, and includes nonoperational safety of such vehicles.[92]

“[A] person may not manufacture for sale, sell, offer for sale, introduce or deliver for introduction in interstate commerce, or import into the United States, any motor vehicle or motor vehicle equipment . . . unless the vehicle or equipment complies with the standard.”[93] An FMVSS can mandate a technology’s inclusion in a car, even if its usage is not required to drive the car.

Seatbelts provide a perfect example. FMVSS 208, entitled Occupant Crash Protection,

specified the type of occupant restraints (i.e., seat belts) required. It was amended to specify performance requirements for anthropomorphic test dummies seated in the front outboard seats of passenger cars and of certain multipurpose passenger vehicles, trucks, and buses, including the active and passive restraint systems identified below. The purpose of the standard is to reduce the number of fatalities and the number and severity of injuries to occupants involved in frontal crashes.[94]

Despite the fact that seatbelts must be placed in automobiles pursuant to Standard 208 and that manufacturers must include reminders to use them,[95] states decide whether their use is mandatory.[96] In practice, however, because of the ubiquity of seatbelts in motor vehicles, seatbelt use is second nature to many Americans.

By mandating breathalyzers in all new cars, the federal government could take a big step toward informing drivers when they have had too much to drink, even if it would not mechanically inhibit drivers from starting their cars while intoxicated. A breathalyzer forces potential drunk drivers to directly confront the fact that they are, in fact, too intoxicated to safely drive. Knowledge is power.

And should states or manufacturers not place IIDs in cars, courts could use the data collected—or not—from breathalyzers in DUI sentencing. For example, if a driver self-administered a breathalyzer and it warned him that he was over the limit, his decision to forge onwards is unquestionably relevant to the sentencing judge. The same could be said for someone whose BAC was borderline: if she had self-administered a test and the result came back negative, her sentence could reasonably be lowered in light of her reliance on the device’s readings.

Even if states do not directly limit drunk drivers’ ability to start the engine, such a measure would serve as an ever-present reminder for those who think that, despite having a few drinks socially, they are nevertheless fit to drive.

Finally, as stated outright, this regulatory scheme would also permit manufacturers to go above the (new) FMVSS by placing IIDs in their cars. While a permissive scheme may itself be a relative half-measure in terms of inducing IID uptake, it will certainly bypass one of the main barriers to IID usage: public awareness of their existence.[97] Additionally, there is reason to think that auto manufacturers will avail themselves of that option in order to tout their safety records in advertising.[98]

Therefore, this measure should be endorsed.

ii. Federally Mandate IIDs in Automobiles

The Secretary of Transportation could take a more direct, active, and dramatically effective role in combatting drunk driving by mandating IIDs in all cars. The statistics have been listed earlier—and will be reused later—but are worth repeating: 59,554 lives saved, 1.25 million nonfatal injuries prevented, and $260 billion saved in the process.[99]

There is also precedent for mandating the technology’s usage within the current FMVSS regime. For example, the federal government imposes requirements on “the location, identification, and illumination of motor vehicle controls and displays . . . to ensure the accessibility and visibility of motor vehicle controls . . . in order to reduce the safety hazards caused by the diversion of the driver’s attention[.]”[100] Other FMVSS geared at crash avoidance require specific systems on window defrosting,[101] windshield wipers,[102] headlights,[103] tires,[104] and mirrors.[105] Most relevantly, FMVSS No. 114 mandates mechanical protections on the ignition system itself as well as the transmission to protect against theft and crashes resulting from unauthorized driving.[106] Policy precedent therefore reaches not only federal mandatory safety features in motor vehicles, but even the engine ignition process itself. IIDs should be no different.

Though such a course of action is unlikely to happen immediately—if only because of a potential shortage of available hardware currently available—the federal government could nevertheless set a reasonable timeline to first make the device’s use optional and/or mandatory.[107] This solution would also require state compliance in regularly inspecting the device to ensure its viability. Given that all 50 states already utilize IIDs in their penal code in some fashion,[108] the states are unlikely to threaten the implementation of mandated IID use.

Finally, critics could take legal issue with this solution. States choosing to enact such a provision are undoubtedly within their rights to do so as sovereign entities; however, should Congress choose to do so, some may question whether Congress has the right to delegate that authority to the Secretary of Transportation at all. Congress’ interstate commerce powers, however, likely provide sufficient legal foundation to enact such a law.

The Interstate Commerce Clause of the Constitution affords Congress the right “[t]o regulate Commerce . . . among the several States[.]”[109] Under United States v. Lopez,[110] the Supreme Court

identified three broad categories of activity that Congress may regulate under its commerce power. First, Congress may regulate the use of the channels of interstate commerce. Second, Congress is empowered to regulate and protect the instrumentalities of interstate commerce, or persons or things in interstate commerce, even though the threat may come only from intrastate activities. Finally, Congress’ commerce authority includes the power to regulate those activities having a substantial relation to interstate commerce, i.e., those activities that substantially affect interstate commerce.[111]

The first category, that Congress can regulate the use of the channels of interstate commerce, unquestionably supports the permissibility of a mandatory IID law. As far back as 1913, the Court held that commerce

consists of intercourse and traffic between their citizens, and includes the transportation of persons and property. There may be, therefore, a movement of persons as well as of property; that is, a person may move or be moved in interstate commerce.[112]

The Court has repeatedly upheld this principle,[113] and has thus recognized “the authority of Congress to keep the channels of interstate commerce free from immoral and injurious uses.”[114]

Given the risk to oneself and others on the road, what could be a more “injurious” use of our interstate[115] channels than drunk driving?[116] Therefore, any such laws should easily clear Commerce Clause challenges.[117] What is more, when an analogous FMVSS was under scrutiny by the Supreme Court, the authorizing act was presumed to be constitutional[118]: the Court only considered whether a particular regulation[119] was reasonable.[120]

There is also significant reason to believe that mandating its use will be effective. As stated earlier, while not perfect, IIDs have proven to prevent up to 67 percent of drunk driving for those driving automobiles with the IIDs installed.^[121] There’s no reason it cannot therefore stop would-be first time offenders, too! With broader laws to mandate its use, there is certainly hope that drunk driving will approach eradication entirely.[122] What’s more, this solution goes a long way to addressing one of the main barriers to adoption named above: familiarity with the technology.[123]

Therefore, this solution should also be endorsed and adopted by the federal government.

iii. Leverage States to Incentivize Adoption

Short of federally mandating IID installation and putting the onus on the manufacturer, Congress can compel states to incentivize the device’s after-market adoption. Specifically, one solution calls for conditioning federal aid on states’ imposing taxes on those who choose not to install a device—or tax breaks for those who install one—and/or on advertising campaigns sponsoring the device.

Federalism prevents the federal government from dictating exactly what a state can and cannot do, but there are other tools in the federal toolbox. One of the strongest has already been mentioned and is used regularly relating to automobile safety—conditional aid. Conditional aid need only satisfy three substantive criteria:

The first of these limitations is . . . the exercise of the spending power must be in pursuit of “the general welfare.” In considering whether a particular expenditure is intended to serve general public purposes, courts should defer substantially to the judgment of Congress. Second, we have required that, if Congress desires to condition the States’ receipt of federal funds, it “must do so unambiguously . . . enabl[ing] the States to exercise their choice knowingly, cognizant of the consequences of their participation.” Third, . . . conditions on federal grants might be illegitimate if they are unrelated “to the federal interest in particular national projects or programs.”

Beyond these three substantive conditions, the Supreme Court has incorporated a fourth criterion: The federal government must not provide the states with a false choice that moves beyond condition and into compulsion.[125] Only once has a conditional federal aid grant been found to overreach the Spending Power.[126] In National Federation of Independent Business v. Sebelius (NFIB), which explicated this additional criterion in depth,[127] the Court struck down provisions of the Affordable Care Act that gave states a choice between expanding Medicaid coverage or losing all federal Medicaid funds.[128] Though the provision may have met Dole’s three criteria, the choice presented to states was nevertheless not a fair one. “[T]he financial ‘inducement’ Congress ha[d] chosen [was] much more than ‘relatively mild encouragement’—it [was] a gun to the head.”[129]

These four threshold concerns, however, are unlikely to be implicated by conditioning further funding on IIDs, based on legal and statutory precedent. As an initial note, if the condition is crafted properly, NFIB will be inapposite. More relevantly, the case that spelled out the first three criteria, South Dakota v. Dole, implicated the aforementioned National Minimum Drinking Age Act,[130] which withheld five percent of federal highway funding from states that did not maintain a minimum legal drinking age of 21. The Court upheld the law, finding the five percent figure non-coercive. A judge could not ask for a more on-point precedent. Enacting a law that mandates IID installation—not even IID use—using analogous methods, and to accomplish the same purposes, would likely also pass the test. Thus, the policy objective of reducing drunk driving could be “attained through the use of the spending power and the conditional grant of federal funds.”[131]

Additionally, this solution has statutory precedent. Interlocks have been part of conditional highway funds for nearly two decades. In 1998, federal aid for highways became conditional on ignition interlocks as punitive measures for DUI convictions. Currently, state highway aid can be conditioned on ignition interlocks in two ways. First, states without a “repeat intoxicated driver law” are subject to losing two and a half percent of highway aid.[132] Such a law can be satisfied by mandating ignition interlock systems for those convicted of DUI, but, importantly, does not actually need to: states can meet this requirement with non-interlock, alcohol-driven laws.[133] Second, separate grants are available “to each State that adopts and is enforcing a mandatory alcohol-ignition interlock law for all individuals convicted of driving under the influence of alcohol or of driving while intoxicated.”[134] Therefore, the solution of conditioning funding on IID installation more broadly has statutory precedent.

There are significant advantages to this strategy. First and foremost, many hands make light work. By bringing state governments into the fold, Congress increases the number of people and institutions pushing for this change, which, theoretically, should increase consumer uptake. What is more, state encouragement undermines any claims of an overreaching federal administrative state. This solution also has practical appeal, because the states are best positioned to implement an IID program. Each state already maintains a database of cars. The registration of each car could, and in certain cases already does, also track which cars have IIDs installed, and therefore whether the state qualifies for that aid. Finally, there is the idea that if the program does not take, no harm, no foul. If a state is unsuccessful in getting its citizens to adopt the technology, then the federal government should not dole out the money appropriated, thereby reducing wasted expenditures.

Having seen this strategy effectively undertaken for drunk driving and other automobile safety measures, there is little reason to believe that this methodology cannot be expanded to further the implementation of IIDs.

 

B. State-Specific Strategies to Induce IID Uptake

States have a large role to play in the installation and usage of IIDs across the country. As noted above, arguably the largest role states play is the sanctions placed on drivers convicted of DUI.[135] Given the anemic statistics regarding enforcement—“only 20% of eligible offenders were actually enrolled in a program requiring [IID] installation”[136]—states undoubtedly have a lot of work to do to improve IID usage broadly.

But even without the federal government, states can utilize a number of strategies to incentivize voluntary IID uptake in their respective constituencies. States can certainly implement some of the federal-state strategies contemplated below, namely purchasing and distributing the devices themselves or offering tax incentives to implement the program.[137] But states also have another weapon at their disposal: regulatory control over automobile insurance. Thirty-four states as well as the District of Columbia mandate a discount for safe-driving classes.[138] Additionally, states can mandate insurance companies consider the completion of such a course when calculating drivers’ insurance premiums, just as Michigan does.[139]

States have the ability to institute such proposals because they regulate their own insurance markets. As such, there is absolutely no reason that states could not enact similar laws mandating insurance deductions for drivers who purchase or lease an IID. If such a law deducted a similar percentage as its insurance analogue, the savings on insurance payments could quite quickly pay for itself![140] What’s more, many of the aforementioned defensive driving classes come with the incentive of a driver’s license points deduction.[141] Such a strategy could definitely incentivize further uptake at no direct monetary cost to the state and therefore should be undertaken.

 

C. Dual State and Federal Strategies

There are two strategies that either the state or federal government could enact: government purchasing and direct distribution, or tax deductions for consumer purchasing. This subsection explains why, on the merits, the latter should be adopted and the former rejected.

i. Government Purchasing and Distribution of IIDs

In the most direct of the available possibilities, a government could purchase the devices for each individual, distribute them to every registered car and pay for their installation and monitoring. The legislature could appropriate the estimated funds and the executive, through an administrative agency, negotiate with the private sector to purchase millions of these devices and manage the distribution process by monitoring who has received it and or had the device installed.

Doing so certainly has its benefits by removing all barriers to the consumer, who would need nothing more than proof of title to have a government official coordinate all of his or her needs. Theoretically, this should significantly improve uptake: the individual need not lay out a dime and the work will be mostly done for her, leading to further adoption and therefore a greater benefit extracted by society. But not all that glitters is gold. The administrability of such a program would require significant coordination. In particular, if the federal government were to take on this responsibility, it could accomplish this task by asking individuals to submit their personal identities—including their names, addresses, and car registrations—which may be politically unpalatable. Otherwise, it would need to work with local authorities without any enforcement mechanism should they choose not to cooperate. As such, government purchasing and distribution is rarely, if ever, used for purely individualized benefits, or benefits that can be parceled out on an individual level.

While IID uptake would likely benefit from individualized purchasing and distribution, the prospect of a government agency running the entire process may present huge supply chain and database problems. Thus, government purchase and distribution, while well-intentioned, should be rejected.

ii. Tax Deductions

Alternatively, the federal or state government may consider a tax deduction for the cost of the IID and or its installation. Instead of simply doling out the device and hiring trained technicians to oversee installation and maintenance, the government can create a tax deduction for the devices and their associated costs. Consumers would pay for the device and maintenance directly, but would obtain a deduction to offset these costs. Doing so shifts the burden of uptake to individuals, but imposes fewer logistical demands on federal agencies.

This strategy can also be deployed for the installation and maintenance—the government can pick and choose. Undoubtedly, the decision to include ancillary costs in deduction strategies ought be determined by estimates of their inclusion’s impact on IID uptake, which in turn affects the value—as measured by cost-benefit analysis—of the incentive itself. Importantly, even if deducting all of the costs associated with IIDs maximizes their uptake, maximizing the cost-benefit may involve deducting less than the full costs; for example, if deducting just the device and installation costs will achieve ninety-nine percent uptake, this less-than-full deduction may maximize its cost-benefit.

Deductions can largely be categorized in two broad methods, each with their own pros and cons: deductions at cost or capped deductions. Both of these strategies are viable government strategies for IID uptake.

a) Deductions at Cost

The government can offer a variable deduction for the driver’s costs. This means that the individual can deduct the total amount paid for the device, regardless of what the individual pays.

Providing deductions at cost has tremendous potential. By ensuring the entire cost is covered, an at-cost deduction significantly diminishes barriers to adoption, especially among the poor, because there is zero net cost. More, the consumer will have few, if any, barriers to purchasing a top-of-the-line product, which may be more precise, incur fewer maintenance costs, or enjoy a longer life span. Therefore, indirectly, deductions at cost produce incentive for industry to put forward a better product.

Admittedly, this plan does have a hidden cost—by incentivizing purchases of the very best products, it disincentivizes cost-effective purchasing. If the government is paying for the device so long as it performs the basic task of an IID, companies may want to throw in added features that truly are not worth the added cost, knowing that the consumers will gravitate towards expensive machines with the extra bells and whistles because it costs them nothing. The same is true on the flipside; manufacturers will not be incentivized to minimize their own manufacturing and production costs. Because consumers do not, strictly speaking, consider the societal effect of purchasing the more expensive IID, they may go with the most expensive one without thinking twice, conflating price with quality. This may ultimately raise the total amount of the tax expenditure for funding IID purchases beyond what is cost-justified.

Though offering a flexible tax deduction for all IID costs may lead to some wasted spending, its promise to maximize uptake outweighs extra spending. As such, its worthiness should be evaluated with more granular information on uptake. Depending on the uptake evaluation, this strategy should be deployed.

b) Capped Deduction

The other type of deduction is a capped deduction, meaning the deduction—be it for the device, the installation or the recurring maintenance costs—is capped. (There may be deduction caps on each of these three facets.) As such, individuals may only be granted a deduction up to that cap for the appropriate IID expense. If they pay any less, that difference is lost; any extra, and the additional expense cannot be written off as a deduction.

Like an at-cost deduction, the amount of the cap will have a distinct impact on consumer uptake. But—also like an at-cost deduction—there are some secondary factors to consider if a government were to implement a capped deduction.

The market will respond to a cap. Manufacturers will likely do what they can to maximize their profitability, which suggests that they will both sell the product or perform the service at the cost of the cap and minimize their own costs. As such, capping costs may well impose a limit on innovation. For example, consider a cap of $100 to purchase an IID. If the cost of production is $75, and a company must invest $24 in overhead and advertising to sell its product, it takes a 1% margin, or $1 profit per IID. It is the rare for-profit company that will use such a meager gain to expand market share by investing in R&D, whose success is not guaranteed, to improve the quality and or features of the product, as opposed to just researching further cost-cutting and thereby maximizing profits per unit.

What is more, this innovation may come at the cost of additional features that could be genuinely beneficial. For example, consider the growing number of states and municipalities that have legalized marijuana,[142] each imposing a THC-blood ratio limit for driving. (THC is the principal psychoactive component of the cannabis plant.) Imagine a new technology that enables IIDs to test THC and BAC levels at the same time. Notably, marijuana consumption does not have alcohol’s easily identifiable numerical benchmarks,[143] such as proof and the rule of thumb that one beer is roughly equivalent to one shot is roughly equivalent to one glass of wine.[144] Thus, if such an innovative technology were to be invented by a profit-minded inventor, its installation  would provide a huge windfall for everyone else on the roads. If this feature—or even one that uses blood to measure THC but could be incorporated into the device—costs more than the cap, there is reason to think that many would not be willing to spend the extra money to add the feature.

Undoubtedly, much more investigation must be done regarding the device’s costs, probability of uptake, and subsequent money saved (via the value of life and of quality of life) to ensure uptake is financially reasonable for individuals and states alike. However, despite potential drawbacks, capped tax deductions are also a viable and thus recommended solution to induce the adoption of IIDs.

 

V. Additional Considerations

There are additional considerations when asking whether the government should encourage or mandate—and, if the former, by a taxing or non-taxing strategy—IIDs. Most notably, are there other constitutional issues at play? As with the above, these solutions necessarily bear on the insurance and automobile manufacturing industries; they are economic interventions that would require the market to adjust accordingly. Therefore, it is important to at least speculate how these two necessary industries would respond to either such strategy, particularly through legal processes.

 

A. Constitutional Freedom of Movement and Due Process Concerns

The Fourteenth Amendment to the Constitution provides that a State shall not “deprive any person of life, liberty, or property, without due process of law.”[145] Certainly, restricting the right to drive based on intoxication is not a deprivation of life. Thus, we need to ask whether such a restriction impinges one’s liberty or property interests.

i. Liberty

In 1958, Justice William O. Douglas was quite clear in declaring, “The right to travel is a part of the ‘liberty’ of which the citizen cannot be deprived without the due process of law under the Fifth Amendment.”[146] Justice John Paul Stevens later reaffirmed this idea: “The word ‘travel’ is not found in the text of the Constitution. Yet the ‘constitutional right to travel from one State to another’ is firmly embedded in our jurisprudence.”[147] Indeed, beyond Supreme Court jurisprudence, American citizens’ freedom of movement dates back to Article Four of the Articles of Confederation: “[T]he people of each State shall have free ingress and regress to and from any other state . . . .”[148] One of the three pillars of the “right to travel . . . protects the right of a citizen of one State to enter and to leave another State[.]”[149]

While the historical underpinnings may suggest the right to travel is coterminous with the right to travel by one’s preferred means, as the automobile’s prevalence grew in the 20th century, the “constitutional right to travel became increasingly interpreted not as a right to locomotion by the means of one’s choice, but as a mere right to emigrate between states.”[150]

The functional test for whether a statute infringes on that right is if the law “directly impair[s] the exercise of the right to free interstate movement”[151]; such direct impairment is not present in mandating breathalyzers or IIDs, let alone financially incentivizing them. Analogous cases provide meaningful signposts. For example, in Edwards v. California,[152] the Court struck down a law that would charge “[e]very person, firm or corporation or officer or agent thereof that brings or assists in bringing into the State any indigent person who is not a resident of the State, knowing him to be an indigent person” with a misdemeanor.[153] The Court reasoned that the statute in question evinced the “express purpose and inevitable effect [of] prohibit[ing] the transportation of indigent persons across the California border.”[154] Twenty-five years later, the Court overruled a dismissal of an indictment against private citizens who conspired to restrict another individual from traveling.[155] Specifically, the Court held that Congress had indeed intended the Fourteenth Amendment’s Equal Protection rights to apply to citizens deprived of the use of public facilities—in this case, public roads and bridges.[156]

Legislating mandatory breathalyzers or IIDs does not at all directly impair one’s right to move among the fifty states. Rather, it only affects the method by which the individual ventures within and without state lines. If it were otherwise, every federal auto safety law would be unconstitutional. So while the right to travel is present in our constitutional ethos as well as our constitutional jurisprudence, the right to drive oneself in travel is most certainly not, meaning one cannot claim to have been unconstitutionally deprived of it.

ii. Property

Despite the fact that the driving is not itself a right, it is indeed a significant and weighty benefit.

The procedural component of the Due Process Clause does not protect everything that might be described as a “benefit”: “To have a property interest in a benefit, a person clearly must have more than an abstract need or desire” and “more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it.”[157]

If entitlements “‘are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law,’”[158] state regimes curtailing driving are more than enough to demonstrate that individuals are not entitled to drive. Rather, individuals must demonstrate sufficient competency to get behind the wheel, via both on-road and written exams. More, when licensed individuals take actions that jeopardize public safety, they can have their licenses revoked,[159] and may even be banned for life from driving.[160] Because individuals cannot claim to have “more than an abstract need or desire for [the right to drive, nor] more than a unilateral expectation of it,”[161] they cannot assert a property right, let alone claim it was deprived without due process.

Without either a liberty or property interest, the government need not show “a compelling governmental interest” to substantiate such a law.[162] Instead, as was the case in prior FMVSS litigation, the regulation need only be “rational, based on consideration of the relevant factors and within the scope of the authority delegated to the agency by the statute.”[163] (If mandated explicitly by statute, the same rational basis test would apply.) The ease with which the government can clear this bar cannot be overstated:

The rational basis test in its traditional form is extremely deferential to any proffered governmental interest. . . . Under rational basis review, courts are constrained to accept a legislature’s generalizations even in the presence of an imperfect fit between means and ends. Rational basis review “is not a license for courts to judge the wisdom, fairness, or logic of legislative choices.” Moreover, the party challenging the legislation bears the burden of negating every conceivable rational basis for the classification, regardless of whether or not such a rationale—or any at all—was actually relied upon by the relevant authority.[164]

Therefore, the government should be able to easily meet its burden of demonstrating a law aimed at stopping drunk driving is rationally related to preventing drunks from driving.

 

B. Drunk Drivers as a Suspect Class?

An enterprising violator may claim that the law discriminates against those suffering from alcoholism. When a plaintiff states a claim for an equal protection violation, the Court first asks whether the law discriminates against a “suspect” class of individuals,[165] or a “discrete and insular minorit[y]” group,[166] triggering strict scrutiny of the law in question.[167] Alcoholics can certainly face stigma and stereotyping, but they present a different legal issue than the groups that traditionally trigger the strongest form of judicial review. “Such groups are typically associated with immutable physical characteristics (i.e., races or ethnicities) political powerlessness, a history of purposeful discrimination, or a general subjugation to stigma and stereotype.”[168]

The best case to demonstrate that discrimination against alcoholics would fall under rational basis review rather than strict scrutiny is New York City Transit Authority v. Beazer.[169] In Beazer, the Court decided whether the Transit Authority’s policy to fire or restrict the hiring of all individuals using narcotic drugs (particularly methadone) taken to curb heroin addiction violated the Equal Protection Clause. Six Justices voted to uphold the policy, concluding that the policy was rational and that there was no invidious motivation behind the Transit Authority’s position.[170]

The case against strict scrutiny for alcoholics is even stronger: in Beazer, no one disputed “that substantial numbers of methadone users [were] capable of performing many of the jobs at TA,” without jeopardizing public safety, and yet the employer was allowed to keep the per se policy barring users from employment.[171] In this hypothetical challenge, however, anyone getting behind the wheel while sufficiently inebriated by definition creates a risk to the entire population, making a blanket rule all the more appealing. Therefore, it is exceedingly unlikely that courts would view such a law as discriminatory against alcoholics, and thus we would revert to the rational basis test.

An alcoholic claimant may also turn to an alternative test: “rational basis with bite.”[172] This test emanates primarily from two cases: City of Cleburne v. Cleburne Living Ctr., Inc.,[173] and Department of Agriculture v. Moreno.[174] The former struck down an ordinance requiring the mentally retarded to acquire special permit for a group home based on irrational prejudice, and the latter struck down a provision aimed at prevent participation in the program by “hippies” on similar grounds.

“Hippies” and the mentally retarded may not be discrete and insular minorities to be afforded strict scrutiny under Bowen v. Gilliard,[175] but they are nevertheless targetable victims of discrimination. For that reason, it makes sense that, in the words of Justice Sandra Day O’Connor, “[w]hen a law exhibits such a desire to harm a politically unpopular group, [the Court has] applied a more searching form of rational basis review to strike down such laws under the Equal Protection Clause.”[176] Said another way, “[r]ational basis with bite has been applied primarily, if not exclusively, in cases where the classification at issue inappropriately discriminated against a particular minority and the government’s asserted interests had no rational relationship to that discrimination.”[177]

No one disputes that alcoholics have been discriminated against historically,[178] but rational basis with bite is likely still inappropriate because of the prevalence of alcohol-related problems. For example, a 2007 government study found that “[m]ore than 30 percent of American adults have abused alcohol or suffered from alcoholism at some point in their lives, and few have received treatment . . . .”[179] Such pervasiveness undermines the argument that it is a minority in the first place. Second, even if the law is deemed discriminatory, a hallmark of rational basis with bite is the law’s disconnectedness to its discriminated class. Here, however, such a law is directly related to the putative class, aiming not to look down on alcoholics, but rather to prevent the victims of alcoholism from harming others. If anything, an IID program stands to benefit alcoholics more by ensuring their disorder cannot be destructive—morally, legally, or financially—behind the wheel. Therefore, under an Equal Protection challenge against alcoholics, courts would still probably revert back to a rational basis test.

IID legislation would likely satisfy the standard for rational basis review under the Equal Protection Clause, as with the Due Process Clause. The law, aimed at preventing deaths caused by intoxicated drivers, prevents the intoxicated from getting behind a wheel, which enables them to cause death in the first place. Put simply, nothing could be more rationally related. What’s more, the standard is sufficiently deferential that even a tenuous connection would work. In the words of Professor Cass Sunstein, “rationality review under the equal protection clause, as elsewhere, is highly deferential and almost always results in the validation of statutory classifications.”[180] Given the overwhelming evidence mentioned above of drunk driving’s death toll and financial detriment and the fact that drunk driver IID laws directly aim to address these heinous realities, the legislation very likely clears that low standard.

 

C. Fourth Amendment Considerations

The Fourth Amendment provides:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.[181]

Is there a reasonable argument that any such technology “searches” or “seizes” one’s breath in such a way that infringes on the driver’s Fourth Amendment protections? It is very unlikely for multiple reasons.

First, the state has not encroached or mandated any action. Instead, the individual has chosen to avail himself of the privilege of driving.[182] In this way, it is only a private actor—the manufacturer—who is dictating the search. However:

The Fourth Amendment gives protection against unlawful searches and seizures, and, as shown in the previous cases, its protection applies to governmental action. Its origin and history clearly show that it was intended as a restraint upon the activities of sovereign authority, and was not intended to be a limitation upon other than governmental agencies.[183]

Thus, the Fourth Amendment concerns would not be implicated, let alone violated.

Second, even, arguendo, if the Fourth Amendment applies, the driver has no possessory interest in his or her breath. In Birchfield v. North Dakota,[184] a 2016 case adjudicating the constitutionality warrantless breath and blood tests incident to arrests for drunk driving, Justice Samuel Alito, joined by five of his colleagues, stated: “Humans have never been known to assert a possessory interest in or any emotional attachment to any of the air in their lungs. The air that humans exhale is not part of their bodies. Exhalation is a natural process—indeed, one that is necessary for life.”[185] Without possessory interest in the air, the government cannot by definition unlawfully search or seize it.

Finally, putting all of these considerations aside, “[t]he touchstone of the Fourth Amendment is reasonableness.”[186] If we are simply asked whether it is reasonable to ask all motorists to take one breath before they put their car on the road so as to ensure all drivers’ safety—theirs included, such a minimal intrusion for such a maximal prevention of lost life appears reasonable on its face.

 

D. Federal Preemption for Mandatory IIDs

In the event that the federal government opts to enact a strategy not based on funding—i.e. mandating breathalyzers in cars or IIDs usage before driving—the question of federal preemption is worth discussing. Federal law preempts state law where the federal law explicitly states its intent to do so,[187] or where that intent is implied. Even without any draft language for either solution, there are a few firm rules we can flesh out.

There is an assumption against a federal statute’s preemption of state statutes, and particularly so in the area of police powers[188] or areas that are typically left to state regulation.[189] But “when Congress has made its intent known through explicit statutory language, the courts’ task is an easy one.”[190] So long as “the text of a pre-emption clause is [not] susceptible of more than one plausible reading,”[191] it is likely that a law or regulation mandating the installation and usage of IIDs that includes language explicitly preempting state law will be upheld.

That brings us to implied preemption. Implied preemption can be found in two ways: “where compliance with both federal and state regulations is a physical impossibility”[192]—that is, conflict preemption—or where “[t]he scheme of federal regulation may be so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it”[193]—that is, field preemption.

The degree of implied preemption (or not) over a hypothetical law or regulation is difficult to ascertain: the devil will almost surely be in the details. Even if the legislation or regulation does not include an explicit passage regarding preemption, it is likely impossible to abide by both the federal law that mandates IIDs usage and a state law that exempts usage. But “Congress’s purpose is the ‘ultimate touchstone’ of any preemption analysis.”[194] Enacting a law to ensure these devices are installed in all cars has a fairly self-evident purpose; state schemes designed to undermine such a law will likely be met with a discerning judicial eye.

 

E. The Auto Insurance Industry’s Potential Response to IID Legislation

In the United States, all but one state mandate automotive insurance covering liability for injuries and damages.[195] Only New Hampshire, the “Live Free or Die” state,[196] does not require it, but it does require that drivers demonstrate their ability to pay for the harm caused if an accident occurs.[197] Thus, save for a select few New Hampshirites,[198] having legislation increasing IID usage will undoubtedly affect risk pools and payout needs. So how is the automobile insurance industry likely to react?

In theory, insurers will support IID legislation. In keeping with their support of previous legislation that drives down drunk driving,[199] the auto insurance lobby stands to come out financially neutral if not positive: insurers do not bear the cost of technology, but benefit from decreased payouts due to the technology’s use. If insurers adjust premiums to match this decreased cost proportionately, they are no better off; but if they do so to a lesser degree than that by which costs fall, their margins should increase. It is no wonder that other anti-drunk driving measures have earned the support of insurance companies.

 

F. The Auto Manufacturing Industry’s Potential Response to IID Legislation

Should any of the above proposals pass, automobile manufacturers are likely to rejoice, recognizing a new source of profitability. First, they may do nothing: Their business is the automobile and not the aftermarket addition. But capitalism suggests this may not be true. If IIDs are highlighted on the national stage, manufacturers may want to break into the business in one way, shape, or form. What is more, because they are putting the car together, there is reason to believe they would be able to achieve the greatest cost savings by installing it during design and production as opposed to after the vehicle has already been built. As such, they stand to gain against their after-market competitors.

There is also an economy of scale argument. In addition to relatively centralized design and production facilities, auto companies can access business synergies through their distribution systems. Car dealerships commonly have a service department, or at least an affiliated garage. In addition to regular mechanic services that the dealership could—or already does—provide, the dealer would be able to service the car’s IID.[200] Thus, the dealership becomes a one-stop-shop for the consumer, further incentivizing the manufacturer to keep everything internal.

Finally, manufacturers may choose to advertise the IID’s availability, whether as an a la carte option or a standard feature. Automobile advertisements often tout their safety credentials and their efforts to improve safety.[201] Additionally, auto manufacturers whose products take advantage of tax breaks, most notably the solar power tax break,[202] also tout their favorable tax treatment as a way to entice potential consumers.[203] Car companies may even decide that it is financially worthwhile to include the device as a standard feature so as to highlight it in their advertisements and capture increased market share.

Overall, if IIDs are brought to the forefront of automobile safety legislation, manufacturers may respond by making this either an add-on available a la carte or even standard in new cars, thereby promoting the adoption of IIDs and the overall goal of automobile safety.

 

VII. Conclusion

According to the Centers for Disease Control and Prevention, “[e]very day, 28 people in the United States die in motor vehicle crashes that involve an alcohol-impaired driver. This amounts to one death every 53 minutes.”[204] While self-driving cars may eventually eliminate the possibility of human driving error, we need to do more to bridge the gap to autonomous vehicles. That is where ignition interlocks come in. These devices prohibit a car from starting unless the driver passes what amounts to an in-car breathalyzer exam. IIDs are—and have been—used in criminal law for decades, as states either mandate or permit drivers convicted of driving under the influence to install them as a precaution against recidivism. While IIDs have proved effective in the fight against repeat offenses, both federal and state governments ought be deploying this technology to prevent someone’s first offense. Doing so, studies estimate, would save thousands of lives and billions of dollars.

This article has outlined a number of potential strategies to motivate people to install IIDs outside of just altruism. Having explicated a diverse set of potential solutions, the article offers recommendations on each. However the federal government or individual states choose to proceed, each ought to seriously consider every acceptable proposal and implement it as soon as they can to protect their constituents. Lives quite literally hang in the balance with every passing moment.

 

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[*] J.D. 2017, Harvard Law School; B.S. 2013, Massachusetts Institute of Technology.

[1] Self-driving car technology appears to be on the precipice of a breakthrough in popularity, but legal issues unquestionably remain to be hashed out regarding automobile insurance and liability, see generally, e.g., Sophia H. Duffy & Jamie Patrick Hopkins, Sit, Stay, Drive: The Future of Autonomous Car Liability, 16 SMU Sci. & Tech. L. Rev. 453 (2013); Dorothy J. Glancy, Autonomous and Automated and Connected Cars-Oh My! First Generation Autonomous Cars in the Legal Ecosystem, 16 Minn. J.L. Sci. & Tech. 619 (2015), as well as questions of critical mass need, see Peter Suciu, The Road Ahead for Self-Driving Cars, Tech News World (Mar. 19, 2015), http://www.technewsworld.com/story/81840.html [https://perma.cc/2CBL-NSPH], as well as environmental challenges, see Alex Davies, So, Nobody Knows How Much Self-Driving Cars Will Pollute, Wired (Nov. 18, 2016), https://www.wired.com/2016/11/nobody-knows-much-self-driving-cars-will-pollute/ [https://perma.cc/33JC-DC6K]. However, these important questions are outside the limited scope of this article.

[2] See Shelley Fisher Fishkin, Lighting Out For the Territory: Reflections on Mark Twain and American Culture 134 (1996).

[3] See Impaired Driving: Get the Facts, Ctrs. for Disease Control & Prevention, U.S. Dep’t of Health & Human Servs., http://www.cdc.gov/motorvehiclesafety/impaired_driving/impaired-drv_factsheet.html [https://perma.cc/9JTE-NWQQ].

[4] Id.

[5] Compare id. with Kenneth D. Kochanek et al., Deaths: Final Data for 2014, 65 Nat’l Vital

Stat. Reports 1, 44 tbl. 10 (2016). Admittedly, ensuring drivers do not get behind the wheel when drunk would not solve all alcohol-related motor vehicle deaths: “An analysis of NHTSA’s Fatality Analysis Reporting System (FARS) estimates that if driver BACs were no greater than 0.08 percent, 7,082 of the 10,228 alcohol-impaired road user fatalities occurring in 2010 would have been prevented.” Abdullatif K. Zaouk et al., Driver Alcohol Detection System for Safety (DADSS) – A Status Update 2, (24th Int’l Tech. Conference on the Enhanced Safety of Vehicles (ESV) Working Paper No. 15-0276) (2015), https://www-esv.nhtsa.dot.gov/proceedings/24/files/24ESV-000276.PDF [https://perma.cc/V43E-V48M] [hereinafter NHTSA Update]. However, it would eliminate seventy percent of them, which would be a titanic improvement.

[6] Id. at 1.

[7] See Jonathan Zhou, Steering Wheels That Test Blood-Alcohol Are Coming, Epoch Times (June 9, 2015), http://www.theepochtimes.com/n3/1385916-steering-wheels-that-test-blood-alcohol-are-coming/ [https://perma.cc/Q9GZ-W65Q].

[8] Driver Alcohol Detection System for Safety (DADSS), http://www.dadss.org/ [https://perma.cc/ZCX2-K5CF].

[9] Id.

[10] Sarah Knapton, Alcohol-detecting steering wheels could stop drink driving, Telegraph (June 12, 2015), http://www.telegraph.co.uk/news/uknews/road-and-rail-transport/11671196/Alcohol-detecting-steering-wheels-could-stop-drink-driving.html [https://perma.cc/NJ7L-F5YY].

[11] My sincere thanks to Andrew Sullivan for masterfully compiling and explaining the science of Near Infrared Spectroscopy as well as its applicability to IIDs. Andrew Sullivan, Note, Ending Drunk Driving with A Flash of Light, 21 Rich. J.L. & Tech. 15, 33–51 (2015).

[12] See infra notes 15, 16 and accompanying text.

[13] See Ala. Code § 32-5A-191 (2017); Alaska Stat. Ann. § 12.55.102 ¹⁾West 2017); Ariz. Rev. Stat. Ann. § 28-1401 (2017); Ark. Code Ann. § 5-65-118 (West 2017); Cal. Veh. Code § 23700 (West 2017); Colo. Rev. Stat. Ann. § 42-2-132.5 (West 2017); Conn. Gen. Stat. Ann. § 14-227a (West 2017); Del. Code Ann. tit. 21 § 4177C (West 2017); D.C. Code Ann. § 50-2201.05a (West 2017); Fla. Stat. Ann. § 322.2715 (West 2017); Ga. Code Ann. § 42-8-111 (West 2017); Haw. Rev. Stat. Ann. § 291E-61 (West 2017); Idaho Code Ann. § 18-8005 (West 2017); Ill. Comp. Stat. Ann. 730 § 5/5-6-3.1 (West 2017); Ind. Code Ann. 9-30-5-16 (West 2017); Iowa Code Ann. § 321J.17 (West 2017); Kan. Stat. Ann. 8-1015 (West 2017); Ky. Rev. Stat. Ann. § 189A.340 (West 2017); La. Stat. Ann. 32:378.2 (2017); Me. Rev. Stat. tit. 29-A § 2508 (2017); Md. Code Ann., Transp. § 27-107.1 (West 2017); Mass. Gen. Laws Ann. ch. 90 § 24 (West 2017); Mich. Comp. Laws Ann. 257.319 (West 2017); Minn. Stat. Ann. § 169A.55 (West 2017); Miss. Code. Ann. § 63-11-31 (West 2017); Mo. Ann. Stat. 302.440 (West 2017); Mont. Code. Ann. 61-8-442 (West 2017); Neb. Rev. Stat. Ann. § 60-6,211.05 (West 2017); Nev. Rev. Stat. Ann. §§ 483.490, 484C.460 (West 2017); N.H. Rev. Stat. Ann. § 265-A:36 (2017); N.J. Stat. Ann. 39:4-50.17 (West 2017); N.M. Stat. Ann. § 66-5-33.1 (West 2017); N.Y. Veh. & Traf. § 1193 (McKinney 2017); N.C. Gen. Stat. Ann. § 20-179.3 (West 2017); N.D. Cent. Code Ann. 39-06.1-11 (West 2017); Ohio Rev. Code Ann. § 4511.19 (West 2017); Okla. Stat. Ann. tit. 57 § 612 (West 2017); Or. Rev. Stat. Ann. § 813.602 (West 2017); 75 Pa. Stat. and Cons. Stat. Ann. § 3805 (West 2017); R.I. Gen. Laws Ann. § 31-27-2.8 (West 2017); S.C. Code. Ann. § 56-5-2941 (2017); S.D. Codified Laws §§ 1-11-20, 25 (2017); Tenn. Code Ann. §§ 55-10-409, 417 (West 2017; Tex. Transp. Code Ann. § 521.246 (West 2017); Utah Code Ann. § 41-6a-518 (West 2017); Vt. Stat. Ann. tit. 23 § 1213 (West 2017); Va. Code Ann. § 18.2-270.1 (West 2017); Wash. Rev. Code Ann. 10.21.055 (West 2017); W. Va. Code Ann. § 17C-5A-3a (West 2017); Wis. Stat. Ann. 343.13 (West 2017); Wyo. Stat. Ann. § 31-7-402 (West 2017). See also Emma E. McGinty et al., Ignition Interlock Laws: Effects on Fatal Motor Vehicle Crashes, 1982–2013, 52 Am. J. Preventive Med. 417, 418 (2017); Alcohol Impaired Driving, Governors Highway Safety Ass’n, http://www.ghsa.org/state-laws/issues/Alcohol-Impaired-Driving [https://perma.cc/5UZ8-L96K].

[14] See Amy Maas, Six beer habit earns first interlock, The Press (Dec. 29, 2012),

http://www.stuff.co.nz/the-press/news/8129601/Six-beer-habit-earns-first-interlock [https://perma.cc/K2YX-5V28] (New Zealand); Knapton, supra note 10 (United Kingdom).

[15] NHTSA Update, supra note 5, at 8 (“The 2nd generation [breathalyzer] is too bulky and not suitable for vehicle integration.”).

[16] See, e.g., Julie A. Lahausse & Brian N. Fildes, Cost-Benefit Analysis of an Alcohol Ignition Interlock for Installation in all Newly Registered Vehicles, 10 Traffic Injury Prevention 528 (2009). But see Igor Radun et al., Alcohol Ignition Interlocks in All New Vehicles: A Broader Perspective, 15 Traffic Injury Prevention 335 (2014). It is also worth noting that MADD, the influential anti-drunk driving group, does not endorse the universal installation of IIDs, though the organization does not justify its position on its website. See Sober to Start, Mothers Against Drunk Driving, https://www.madd.org/the-solution/drunk-driving/ignition-interlocks/ [https://perma.cc/5B8C-DB7F].

[17] Act of Apr. 12, 1906, ch. 113, §§ 19, 35, 1906 N.J. Laws 177, 186, 195–97.

[18] A person’s blood alcohol content (BAC) is the standard objective metric of one’s drunkenness, measuring the mass of alcohol per volume of blood. BAC is typically expressed in a percentage or grams per deciliter (g/dL).

[19] An Act Defining Motor Vehicles and Providing for the Registration of Same, supra note 17.

[20] Birchfield v. North Dakota, 136 S. Ct. 2160, 2167 (2016) (citing Robert L. Donigan, Chemical Tests and the Law 2 (1966)).

[21] Robert L. Donigan, Chemical Test Law in the United States 123 (4th Conference of the Int’l Council on Alcohol, Drugs & Traffic Safety, Working Paper) (1965), http://www.icadtsinternational.com/files/documents/1965_017.pdf [https://perma.cc/255E-9B2Z].

[22] Nat’l Safety Council, A History of The Committee On Alcohol And Other Drugs 8 (1989). More modern, detailed descriptions offer a more explicit window into the effects of alcohol at different levels of BAC:

0.02-0.03 BAC: No loss of coordination, slight euphoria and loss of shyness. Depressant effects are not apparent. Mildly relaxed and maybe a little lightheaded.
0.04-0.06 BAC: Feeling of well-being, relaxation, lower inhibitions, sensation of warmth. Euphoria. Some minor impairment of reasoning and memory, lowering of caution. Your behavior may become exaggerated and emotions intensified (Good emotions are better, bad emotions are worse)
0.07-0.09 BAC: Slight impairment of balance, speech, vision, reaction time, and hearing. Euphoria. Judgment and self-control are reduced, and caution, reason and memory are impaired, .08 is legally impaired and it is illegal to drive at this level. You will probably believe that you are functioning better than you really are.
0.10-0.125 BAC: Significant impairment of motor coordination and loss of good judgment. Speech may be slurred; balance, vision, reaction time and hearing will be impaired. Euphoria.
0.13-0.15 BAC: Gross motor impairment and lack of physical control. Blurred vision and major loss of balance. Euphoria is reduced and dysphoria (anxiety, restlessness) is beginning to appear. Judgment and perception are severely impaired.
0.16-0.19 BAC: Dysphoria predominates, nausea may appear. The drinker has the appearance of a “sloppy drunk.”
0.20 BAC: Felling dazed, confused or otherwise disoriented. May need help to stand or walk. If you injure yourself you may not feel the pain. Some people experience nausea and vomiting at this level. The gag reflex is impaired and you can choke if you do vomit. Blackouts are likely at this level so you may not remember what has happened.
0.25 BAC: All mental, physical and sensory functions are severely impaired. Increased risk of asphyxiation from choking on vomit and of seriously injuring yourself by falls or other accidents.
0.30 BAC: STUPOR. You have little comprehension of where you are. You may pass out suddenly and be difficult to awaken.
0.35 BAC: Coma is possible. This is the level of surgical anesthesia.
0.40 BAC and up: Onset of coma, and possible death due to respiratory arrest.

Effects At Specific B.A.C. Levels, Be Responsible About Drinking 21, http://www.brad21.org/effects_at_specific_bac.html [https://perma.cc/JD8N-DS2V].

[23] Birchfield, 136 S. Ct. at 2167 (citations omitted).

[24] Section 402: State Highway Safety Programs, Fed. Highway Admin., U.S. Dep’t of Transp., http://safety.fhwa.dot.gov/legislationandpolicy/policy/section402/ [https://perma.cc/QF4A-8XUW].

[25] Id.

[26] Ralph E. Hingson, Jonathan Howland & Suzette Levenson, Effects of legislative reform to reduce drunken driving and alcohol-related traffic fatalities, 103 Pub. Health Reports 659, 659 (1988).

[27] See History, Mothers Against Drunk Driving, http://www.madd.org/drunk-driving/about/history.html [https://perma.cc/LB7X-6PX3].

[28] Originally at 23 U.S.C. § 408, the language creating the program has since been moved to 23 U.S.C.A. § 405(c) (West 2016).

[29] A per se law criminalizes driving at a certain BAC, regardless of whether the alcohol had or could have had any actual effect on the driver’s motor skills.

[30] Nat’l Highway Traffic Safety Administration, U.S. Dep’t of Transp., Legislative history of .08 Per Se Laws (2001), https://one.nhtsa.gov/people/injury/research/pub/alcohol-laws/08History/index.htm.

[31] 23 U.S.C. § 158 (2012).

[32] Id.

[33] Hingson, supra note 26, at 659–60.

[34] Id.

[35] Id. at 660 (“An analysis of national traffic data from 1978-85 by the Insurance Institute for Highway Safety indicated that administrative per se laws, on average, reduced night crashes 9 percent relative to States that did not pass such legislation. Criminal per se laws against drunken driving and increased penalties were each accompanied by 6-percent declines in night fatal crashes relative to States that did not pass such laws.”).

[36] See, e.g., Joint Resolution To designate the period commencing December 11, 1988, and ending December 17, 1988, as “National Drunk and Drugged Driving Awareness Week,” Pub. L. No. 100-682, 102 Stat. 4079 (1988).

[37] See, e.g., H.R.J. Res. 472, 100th Cong. (1988).

[38] Criminal Victims Protection Act of 1990, Pub. L. No. 101-581, § 2, 104 Stat. 2865, 2865 (codified as amended in scattered sections of 18 U.S.C.).

[39] Drunk Driving Child Protection Act of 1994, Pub. L. No. 103-322, §100002, 108 Stat. 1996, 1996 (codified as amended in scattered sections of 18 U.S.C.).

[40] Transportation, Loyola U. Chi. Health Sys., http://www.stritch.luc.edu/depts/injprev/transprt/tran1-06.htm [https://perma.cc/6P2P-N6VH] (referring to the Transp. Equity Act for the 21st Century, Pub. L. No. 105-178, 112 Stat. 107 (1998)).

[41] Elizabeth Shogren, Clinton Seeks Strict Drunk Driving Laws, L.A. Times (June 11, 1995), http://articles.latimes.com/1995-06-11/news/mn-12121_1_drunk-driving-laws [https://perma.cc/6XV4-EALA].

[42] Press Release, White House, President Clinton Helps Make Our Roads Safer for American Families (Oct. 23, 2000), https://clinton4.nara.gov/textonly/WH/new/html/Mon_Oct_23_085542_2000.html [https://perma.cc/TM7L-YR4P].

[43] Alcohol Impaired Driving, supra note 13.

[44] Nat’l Transp. Safety Board, Reaching Zero: Actions to Eliminate Alcohol-Impaired Driving 23 (2013).

[45] See, e.g., Alcohol Impaired Driving, supra note 13.

[46] Uber itself made this argument. See Press Release, Uber, DUI Rates Decline in Uber Cities (May 5, 2014), https://newsroom.uber.com/us-illinois/dui-rates-decline-in-uber-cities/ [https://perma.cc/K2N2-KRE4] (“estimat[ing] that the entrance of Uber in Seattle caused the number of arrests for DUI to decrease by more than 10%”).

[47] Angela K. Dills & Sean E. Mulholland, Ride-Sharing, Fatal Crashes, and Crime 13 (Feb. 13, 2016) (unpublished article), https://ssrn.com/abstract=2783797 [https://perma.cc/Z5BE-GKRH].

[48] Noli Brazil & David S. Kirk, Uber and Metropolitan Traffic Fatalities in the United States, 184 Am. J. Epidemiology 192, 192 (2016) (finding that “the deployment of Uber services in a given metropolitan county had no association with the number of subsequent traffic fatalities, whether measured in aggregate or specific to drunk-driving fatalities or fatalities during weekends and holidays”).

[49] Id. at 196–97.

[50] Id. at 197.

[51] Frederick Kunkle, Is Uber reducing drunk driving? New study says no, Wash. Post (Jul. 27, 2016), https://www.washingtonpost.com/news/tripping/wp/2016/07/27/is-uber-reducing-drunk-driving-new-study-says-no/ [https://perma.cc/4HHR-TAA9].

[52] Nat’l Highway Traffic Safety Admin., U.S. Dep’t of Health & Human Servs., Traffic Safety Facts 1 (2015), https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublication/812231 [https://perma.cc/WB7K-DCT4].

[53] Id. at 4.

[54] Id. at 2.

[55] Lawrence J. Blincoe et al., The Economic and Societal Impact Of Motor Vehicle Crashes, 2010 (Revised) 162, Nat’l Highway Traffic Safety Admin., U.S. Dep’t of Health & Human Servs. (Rep. No. 812 013). The report also thoroughly details how it arrives at those conclusions, including the costs of part parts impacted, hospital stays and loss of productivity as well as cost estimates of life lost. Id. at 22–33. The costs also reflect property damage, insurance damages, and legal costs, id. at 34–43, and miscellaneous costs, id. at 43–45.

[56] Id. at 3.

[57] Id. at 3.

[58] Id. at 162.

[59] Id. at 160.

[60] Id.

[61] Id. at 287 (Appendix G).

[62] Id. (defining “comprehensive costs” as “the value of lost quality-of-life as measured by society’s willingness to pay to avoid risk, together with the economic impacts that result from death or injury in traffic cases”).

[63] Id. at 4.

[64] Id.

[65] McGinty et al., supra note 13, at 2 (citing TEA-21 – Fact Sheet: Minimum Penalties for Repeat Offenders for DWI or DUI, Fed. Highway Admin., U.S. Dep’t of Transp., https://www.fhwa.dot.gov/Tea21/factsheets/n_164.htm [https://perma.cc/L3WR-XXMK]).

[66]How The Ignition Interlock Device Works, IgnitionInterlockDevice.Org, http://www.ignitioninterlockdevice.org/ignitioninterlockdevice.html [https://perma.cc/YMA8-B2EW].

[67] Tara Casanova-Powell et al., Evaluation of State Ignition Interlock Programs: Interlock Use

Analyses From 28 States, 2006-2011, 1 Nat’l Highway Traffic Safety Admin., U.S. Dep’t of Health & Human Servs. (Rep. No. 812 145).

[68] See Sober to Start, supra note 16.

[69] See id. Additionally, states require that the devices meet specifications before installation.

[70] This is one reason the DADSS recommended finger-reading technology, which does not test the air. See Sullivan, supra note 11, at 25 (“There are numerous ways to ‘game’ breathalyzers to give a false signal”) (citing Shelly Wutke, Cheat the Interlock Device? Not a Good Idea, Guardian Interlock (Sept. 10, 2014), http://guardianinterlock.com/blog/cheat-interlock-device-good-idea/ [https://perma.cc/C2JF-QLVG]).

[71] A fingerprint reader mixed with a BAC reader could solve the identity-verification problem. See supra note 9 and accompanying text.

[72] This would also implicate potential Fourth Amendment questions, described infra in Section V.C.

[73] See Ala. Code § 32-5A-191.4 (2017); Alaska Stat. Ann. § 11.76.140 (West 2017); Ark. Code Ann. § 5-65-123 (West 2017); Ariz. Rev. Stat. Ann. § 28-1464; Cal. Veh. Code § 23247 (West 2017); Conn. Gen. Stat. Ann. § 14-227k (West 2017); D.C. Code Ann. § 50-2201.05a (West 2017); Del. Code Ann. tit. 11 § 1249 (West 2017); Ga. Code Ann. § 42-8-118 (West 2017); Fla. Stat. Ann. § 316.1937 (West 2017); Haw. Rev. Stat. Ann. § 291E-66 (West 2017); Ill. Comp. Stat. Ann. 625 § 5/6-206.2 (West 2017); Ind. Code Ann. 9-30-5-8 (West 2017); Iowa Code Ann. § 321J.20 (West 2017); Kan. Stat. Ann. 8-1017 (West 2017); Ky. Rev Stat. Ann. § 189A.345 (West 2017); La. Stat. Ann. 14:334 (2017); Me. Rev. Stat. Ann. tit. 29-A § 2508 (2017); Md. Code Ann, Transp. § 27-107 (West 2017); Mass Gen. Laws Ann. 90 § 24T (West 2017); Minn. Stat. Ann. § 171.306 (West 2017); Miss Code Ann. § 63-11-31 (West 2017); Mich. Comp. Laws Ann. 257.625l (West 2017); Mo. Ann. Stat. 577.612 (West 2017); Mont. Code Ann. 61-8-440 (West 2017); Neb. Rev. Stat. Ann. § 60-6,211.05 (West 2017); N.H. Rev Stat. Ann. § 265-A:37; N.J. Stat. Ann. 39:4-50.19 (West 2017); N.M. Stat. Ann. § 66-5-33.1 (West 2017); N.Y. Veh. & Traf. § 1198 (McKinney 2017); N.C. Gen. Stat. Ann. § 20-17.8A (West 2017); N.D. Cent. Code Ann. 39-06.1-11 (West 2017); Ohio Rev. Code Ann. § 4510.44 (West 2017); Or. Rev. Stat. Ann. § 813.610 (West 2017); 75 Pa. Stat. and Con. Stat. Ann. § 3808 (West 2017); R.I. Gen. Laws Ann. § 31-27-2.8 (West 2017); S.C. Code Ann. § 56-5-2941 (2017); S.D. Codified Laws § 32-23-4.9 (2017); Tenn. Code Ann. § 55-10-417 (West 2017); Tex. Code Crim. Proc. Ann. art. 42A.408 (West 2017); Utah Code Ann. § 41-6a-518.1 (West 2017); Vt. Stat. Ann. tit. 23 § 1213 (West 2017); Va. Code Ann. § 18.2-270.1 (West 2017); Wash Rev. Code Ann. 46.20.750 (West 2017); Wis. Stat. Ann. 347.413 (West 2017); Wyo. Stat. Ann. § 31-7-404 (West 2017).

[74] E. Donald Sussman, Transp. Sys. Ctr., Summary and Evaluation of Responses Received on the Alcohol Safety Interlock system Prospectus 1 (1971).

[75] Richard P. Compton, Nat’l Highway Traffic Safety Admin., U.S. Dep’t of Health & Human Servs., Potential for Application of Ignition Devices to Prohibit Operation of Motor Vehicles By Intoxicated Individuals 2–5 (1988), https://ntl.bts.gov/lib/25000/25800/25800/DOT-HS-807-281.pdf [https://perma.cc/4AZX-6RDN].

[76] Id. at viii.

[77] See, e.g., Oversight Hearing on Effectiveness of Federal Drunk Driving Programs: Hearing Before the Subcomm. on Transp. Safety, Infrastructure Sec., & Water Quality of the S. Comm. on Env’t & Publ. Works, 110th Cong. 1–2 (2007) (statement of Frank Lautenberg, Chairman, Subcomm. on Transp. Safety, Infrastructure Security, and Water Quality) (“To prevent more injuries, we ought to make greater use of technology such as ignition interlocks that lock a car’s ignition when a driver’s blood alcohol level is too high. I look forward to hearing about those efforts.”); Vehicle Safety for Children: Hearing Before the Subcomm. on Consumer Affairs, Ins., & Auto. Safety of the S. Comm. on Commerce, Sci., & Transp., 110th Cong. 39 (2007) (statement of Dave McCurdy, President, CEO, Alliance of Automobile Manufacturers); Various Approaches to Improving Highway Safety: Hearing Before the Subcomm. on Highways a& Transp. of the H. Comm. on Transp. & Infrastructure, 107th Cong. 49 (2002) (statement of Wendy Hamilton, President-Elect, Mothers Against Drunk Driving); Averting Alcohol Abuse: New Directions in Prevention Policy: Hearings Before Committee on Government Affairs, 101st Cong. 33–34 (1989) (statement of William Scott, Director, Office of Alcohol and State Programs, National Highway Traffic Safety Administration); Safety Implications of the Kentucky Schoolbus Crash: Hearing Before the Subcomm. on Transp., Tourism, & Hazardous Materials of the H. Comm. on Energy & Commerce, 100th Cong. 1–2 (1988) (statement of Thomas A. Luken, Chairman, H. Subcomm. On Transp., Tourism, and Hazardous Materials) (“We want to know why NHTSA is not doing more to ensure the use of ignition interlock devices which prevent a person who has been drinking alcohol from starting an automobile”);  U.S. Gov’t Accountability Office, GAO-14-559, Traffic Safety: Alcohol Ignition Interlocks Are Effective While Installed; Less Is Known about How to Increase Installation Rates (2014), http://www.gao.gov/assets/670/664281.pdf [https://perma.cc/25BA-2SBW].

[78] See McGinty et al., supra note 13, at 2 (first citing Kenneth H. Beck et al., Effects of Ignition Interlock License Restrictions on Drivers With Multiple Alcohol Offenses: A Randomized Trial in Maryland, 89 Am. J. Pub. Health 1696 (1999); and then citing Charlene Willis et al., Alcohol Ignition Interlock Programmes for Reducing Drink Driving Recidivism, Cochrane Database Systematic Revs. at 4 (Article No. CD004168, 2004); and then citing Randy W. Elder et al., Effectiveness of Ignition Interlocks for Preventing Alcohol-Impaired Driving and Alcohol-Related Crashes: A Community Guide Systematic Review, 40 Am. J. Preventive Med. 362 (2011); and then citing Richard Roth et al., Interlocks for First Offenders: Effective?, 8 Traffic Inj. Prevention 346 (2007); and then citing Julie A. Lahausse & Brian N. Fildes, Cost-Benefit Analysis of an Alcohol Ignition Interlock for Installation in all Newly Registered Vehicles, 10 Traffic Inj. Prevention 528 (2009); and then citing Jeffrey H. Coben & Gregory L. Larkin, Effectiveness of Ignition Interlock Devices in Reducing Drunk Driving Recidivism, 16 Am. J. Preventive Med. (Supplement 1) 81 (1999); and then citing Casanova-Powell, supra note 8).

[79] Casanova-Powell, supra note 8, at 1 (citing Elder et al., supra note 79; Willis et al., supra note 79).

[80] See Patrick M. Carter et al., Modeling the Injury Prevention Impact of Mandatory Alcohol Ignition Interlock Installation in All New U.S. Vehicles, 105 Am. J. Pub. Health 1028, 1028 (2015).

[81] Id. The study used the Fatality Analysis Reporting System (FARS) and National Automotive Sampling System’s General Estimates System (NASS-GES) to identify alcohol-involved motor vehicle crashes’ injuries and fatalities. Id. at 1029. The study classified alcohol-involved crashes as ones in which one or more drivers had a blood alcohol content value of greater than .02 g/dL, one quarter of the legal limit. Id.

[82] Id. at 1031.

[83] Id.

[84] See Gwen Bergen et al., Vital Signs: Alcohol-Impaired Driving Among Adults—United States, 2010, 306 J. Am. Med. Ass’n 2208, 2208–09 (2011).

[85] Carter, supra note 81, at 1031.

[86] Id. at 1033.

[87] Such regulations are likely to fail at the state level because a lone state market may not create enough of an incentive for a major automobile manufacturer to change its production models while also incentivizing drivers to register automobiles across state borders.

[88] See also Sullivan, supra note 11, at 5–33.

[89] Motor Veh. Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co. (“State Farm”), 463 U.S. 29, 33–34 (1983).

[90] 49 U.S.C. § 30111 (2012). The FMVSS are codified at 49 C.F.R. pt. 571 (2016).

[91] See Federal Motor Vehicle Safety Standards and Regulations, Office of Vehicle Safety Compliance, Dep’t. of Transp., https://icsw.nhtsa.gov/cars/rules/import/FMVSS/ [https://perma.cc/ET2F-VZKD].

[92] National Traffic and Motor Vehicle Safety Act of 1966, Pub. L. No. 89-563, § 102, 80 Stat. 718 (1966) (codified as amended in 49 U.S.C. (2012)). Put another way, FMVSS “generally focus on crash avoidance, crashworthiness, and post-crash survivability.” Anita N. Kim et al., Review of Federal Motor Vehicle Safety Standards (FMVSS) for Automated Vehicles 1 (2016).

[93] 49 U.S.C. § 30112 (2012).

[94] Federal Motor Vehicle Safety Standards, supra note 92 (citing Standard No. 208; Occupant crash protection, 49 C.F.R. § 571.208 (2017)). The FMVSS took effect on January 1, 1968. Id.

[95] See 49 U.S.C. § 30124 (2012).

[96] See Occupant Protection | Safety (Seat) Belts and Child Passengers, Nat’l Conference of State Legislatures, http://www.ncsl.org/research/transportation/occupant-protection-safety-belts-and-child-passen.aspx [https://perma.cc/Q9L6-YGEA]. Only New Hampshire does not mandate seatbelt usage for drivers, id., though the other states treat driving without a seatbelt in a non-uniform manner: some categorize it as a primary offense, and others as a secondary one. Id. The former signifies that lacking a seatbelt alone is a violation and merits an officer pulling over a driver, while the latter signifies that it can only be cited if the driver is pulled over or cited for a different violation. Id.

Notably, seat belt ignition interlocks—barring cars from starting without a fastened driver seat belt—were briefly required at the federal level. See Laws Requiring Safety Belts, Traffic Ls. Comment., Oct. 1972, at 2. These laws were repealed soon after. See id.; 49 U.S.C. § 30124 (2012), supra note 95.

Moreover, in 2013, BMW “applied for, and the NHTSA denied, a rulemaking petition providing for an exception to the prohibition on seatbelt interlock systems.” Sullivan, supra note 11, at 18 (citing Federal Motor Vehicle Safety Standards; Occupant Crash Protection, 78 Fed. Reg. 53,386 (Aug. 29, 2013) (codified at 49 C.F.R. § 571)).

[97] See supra note 87 and accompanying text.

[98] See infra note 182 and accompanying text.

[99] See supra notes 81–84 and accompanying text.

[100] Sch. Bus Mfrs. Tech. Council, Mini Guide to the Federal Motor Vehicle Safety Standards and Related Regulations (issued as of May 1, 2004) (2004), http://www.nasdpts.org/documents/pubsbmtcminiguide04.pdf [https://perma.cc/43GZ-BZH8] (citing Theft Protection and Rollaway Prevention, 49 C.F.R. § 571.114 (2017)).

[101] Windshield Defrosting and Defogging Systems, 49 C.F.R. § 571.103 (2017).

[102] Windshield Wiping and Washing Systems, 49 C.F.R. § 571.104 (2017).

[103] Lamps, Reflective Devices, and Associated Equipment, 49 C.F.R. § 571.108 (2017).

[104] New Pneumatic and Certain Specialty Tires, 49 C.F.R. § 571.109 (2017); Tire Selection and Rims and Motor Home/Recreation Vehicle Trailer Load Carrying Capacity Information for Motor Vehicles with a GVWR of 4,536 Kilograms (10,000 pounds) or Less, 49 C.F.R. § 571.110 (2011); Dep’t of Transp. Retreaded Pneumatic Tires, 49 C.F.R. § 571.117 (2011); Dep’t of Transp. New Pneumatic Tires for Motor Vehicles with a GVWR of More Than 4,536 Kilograms (10,000 Pounds) and Motorcycles, 49 C.F.R. § 571.119 (2017); Tire Selection and Rims and Motor Home/Recreation Vehicle Trailer Load Carrying Capacity Information for Motor Vehicles with a GVWR of More Than 4,536 Kilograms (10,000 Pounds), 49 C.F.R. § 571.120 (2017).

[105] Rear Visibility, 49 C.F.R. § 571.111 (2017).

[106] Theft Protection and Rollaway Prevention, 49 C.F.R. § 571.114 (2017).

[107] This has been done before. See, e.g., Light Vehicle Brake Systems, 49 C.F.R. § 571.135 (2017); FMVSS No. 135 (implementing a 3 or 4 year optional period for vehicle brake systems, after which the system became mandatory).

[108] See supra notes 13, 74.

[109] U.S. Const., art. I, § 8, cl. 3.

[110] United States v. Lopez, 514 U.S. 549 (1995).

[111] Id. at 558–59 (internal citations and quotations omitted).

[112] Hoke v. United States, 227 U.S. 308, 320 (1913).

[113] See, e.g., United States v. Darby, 312 U.S. 100, 113 (1941); Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 256 (1964).

[114] Caminetti v. United States, 242 U.S. 470, 491 (1917) (stating that this principle “is no longer open to question.”).

[115] The highway system is based off of roadways named Interstates! See History of the Interstate Highway System, Fed. Highway Admin., U.S. Dep’t of Transp., https://www.fhwa.dot.gov/interstate/history.cfm [https://perma.cc/SQL7-YDXW].

[116] Not to mention “immoral.”

[117] An argument could also be lodged under the third pillar of Commerce Clause jurisprudence: with respect to control of activities which “have such a close and substantial relation to interstate commerce that their control is essential or appropriate to protect that commerce from burdens and obstructions, Congress cannot be denied the power to exercise that control.” NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 37 (1937). Though the scope of the Commerce Clause has waned in recent decades, see, e.g., Kathleen M. Sullivan & Noah R. Feldman, Constitutional Law 109–10, 136–64 (18th ed. 2013) (highlighting the Supreme Court’s decisions in United States v. Lopez, 514 U.S. 549 (1995), United States v. Morrison, 529 U.S. 598 (2000), and Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519 (2012), as “mark[ing] a partial return to judicial intervention to prevent the Commerce Clause from becoming an unlimited national police power”), drunk driving’s vast impact on the economy may prove sufficiently to meet the “substantial relationship” threshold. Admittedly, this argument may face an uphill battle in light of Morrison, 529 U.S. at 598.

[118] See generally Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983).

[119] Specifically, the removal of a regulation, which is technically itself a regulation. See id. at 42 (“While the removal of a regulation may not entail the monetary expenditures and other costs of enacting a new standard . . . the direction in which an agency chooses to move does not alter the standard of judicial review established by law.”).

[120] See State Farm, 463 U.S. at 29.

[121] See supra notes 79–80 and accompanying text.

[122] A secondary source for inspiration is the effect of mandatory seatbelt laws. One study determined that these laws led to a 22 percent increase in seatbelt usage. Alma Cohen & Liran Einav, The Effects of Mandatory Seat Belt Laws on Driving Behavior and Traffic Fatalities, 85 Rev. Econ. & Stat. 828, 829 (2003). Admittedly, this figure was only for states that classified seatbelt violations as primary offenses; that figure dropped down to 11 percent when seatbelt violations were classified as a secondary offense. Id.

[123] See supra note 87 and accompanying text.

[124] South Dakota v. Dole, 483 U.S. 203, 207 (1987) (citations omitted).

[125] See, e.g., New York v. United States, 505 U.S. 144, 149 (1992) (“[W]hile Congress has substantial power under the Constitution to encourage the States to [provide a service], the Constitution does not confer upon Congress the ability simply to compel the States to do so.”) In New York, for example, the Supreme Court struck down a statute that gave states the choice between complying with federal regulations regarding handling nuclear waste and “taking title to and possession of the low level radioactive waste generated within their borders and becoming liable for all damages waste generators suffer as a result of the States’ failure to” regulate such materials. Id. at 174–75. Given the severity of this proposed “choice,” the Court held that “Congress has crossed the line distinguishing encouragement from coercion.” Id. at 175.

[126] See Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519, 647 (2012) (Scalia, Kennedy, Thomas, and Alito, JJ., dissenting).

[127] Id. at 576–85.

[128] Id. at 585.

[129] Id. at 581.

[130] Pub. L. No. 98-363, 98 Stat. 435 (1984); 23 U.S.C. § 158 (2012); 23 C.F.R. § 1208.3 (2017).

[131] Dole, 483 U.S. at 207.

[132] 23 U.S.C. § 164(b)(2).

[133] 23 U.S.C. § 164(a). For example, instead of an interlock law, a state can suspend driving privileges for one year or restrict driving privileges pending participation in a “24-7 sobriety program,” pursuant to § 405(d)(7)(A). § 164(a). Making IIDs non-mandatory has been detrimental to their adoption by the states. See infra note 134 and accompanying text.

[134] 23 U.S.C. § 405. The most relevant is the Impaired Driving Countermeasures program, 23 C.F.R. 1200.23. The grants are awarded to “[s]tates that adopt and implement effective programs to reduce traffic safety problems resulting from individuals driving motor vehicles while under the influence of alcohol, drugs, or the combination of alcohol and drugs or that enact alcohol ignition interlock laws.” Id. (emphasis added). Grants doled out under this provision are available to all fifty states and Puerto Rico. The states are then divided into low-, medium-, and high-range states based on a state’s fatality statistics. Id. The lower the statistics, the more flexibility the state is granted in how the granted funds are used and the fewer additional conditions the state must satisfy—often in the form of other legislative measures to combat impaired driving—to receive the grants. Id.

[135] For an excellent overview of state laws and IID usage, see Sullivan, supra note 11, at 6–8.

[136] Id. at 6 (internal citations omitted).

[137] See supra Sections IV.A–D.

[138] Ala. Code. § 27-13-120 (2017); Alaska Stat. Ann. § 21.96.025 (West 2017); Ark. Code. Ann. § 27-19-608 (West 2017); Cal. Veh. Code §§ 1675, 1676 (West 2017); Colo. Rev. Stat. Ann. § 10-4-632 (West 2017); Conn. Gen. Stat. Ann. § 38a-683 (West 2017); D.C. Code Ann. § 50-2003 (West 2017); 18 Del. Admin. Code § 600 (2017); Fla. Stat. § 627.0652 (2017); Ga. Code Ann. § 33-9-42 (West 2017); Idaho Code Ann. § 41-2515 (West 2017); Ill. Comp. Stat. Ann. 215 § 5/143.29 (West 2017); Kan. Stat. Ann. 40-1112a (West 2017); Ky. Rev. Stat. Ann. § 304.13-063 (West 2017); La. Stat. Ann. 22:1457 (2017); Me. Rev. Stat. Ann. tit. 24-A § 2902-G (2017); Minn. Stat. Ann. § 65B.28 (West 2017); Miss. Code Ann. § 63-15-46 (West 2017); Mont. Code Ann. 33-16-223 (West 2017); Nev. Rev. Stat. Ann. 690B.029 (West 2017); N.J. Stat. Ann. 17:33B-45.1 (West 2017); N.M. Stat. Ann. § 59A-32-14 (West 2017); N.Y. Ins. Law § 2336 (McKinney 2017); N.D. Cent. Code Ann. 26.1-25-04.1 (West 2017); Okla. Stat. Ann. tit. 36 § 924.1 (West 2017); Or. Rev. Stat. Ann. § 742.490 (West 2017); 75 Pa. Stat. and Cons. Stat. Ann. § 1799.2 (West 2017); R.I. Gen. Laws Ann. § 27-9-7.1 (West 2017); S.C. Code Ann. § 38-73-737 (2017); Tenn. Code Ann. § 56-7-1107 (West 2017); Utah Code Ann. § 31A-19a-211 (West 2017); Va. Code Ann. § 38.2-2217 (West 2017); Wash. Rev. Code Ann. 48.19.460 (West 2017); W. Va. Code Ann. § 33-20-18 (West 2017); Wyo. Stat. Ann. § 26-14-105 (West 2017).

[139] Mich Comp. Laws Ann. 500.2111 (West 2017).

[140] Compare Robert Harrow, Take a Defensive Driving Class if You Live in These States, Huffington Post (Feb. 24, 2017, 4:39 PM), http://www.huffingtonpost.com/robert-harrow/take-a-defensive-driving-_b_9290232.html [https://perma.cc/85UY-35MG] with Sober to Start, supra note 16 (“On average, interlocks are about $70-150 to install and about $60-80 per month for monitoring and calibration.”).

[141] See, e.g., N.J. Stat. Ann. 39:5-30.9 (West 2017) (“Points recorded against a licensee shall also be reduced by two points if the licensee attends and satisfactorily completes an approved motor vehicle defensive driving course . . . .”); N.D. Cent. Code Ann. 39-06.1-13 (West 2017).

[142] See Katy Steinmetz, These States Just Legalized Marijuana, Time (Nov. 8, 2016), http://time.com/4559278/marijuana-election-results-2016/ [https://perma.cc/6U44-4CPL].

[143] See Angus Chen, Why Is It So Hard To Tell Whether Drivers Are Stoned?, NPR: Shots (Feb. 9, 2016, 12:27 PM), http://www.npr.org/sections/health-shots/2016/02/09/466147956/why-its-so-hard-to-make-a-solid-test-for-driving-while-stoned [https://perma.cc/96W9-C69B].

[144] See What Is A Standard Drink?, Nat’l Inst. On Alcohol Abuse & Alcoholism, Nat’l Inst. of Health, https://www.niaaa.nih.gov/alcohol-health/overview-alcohol-consumption/what-standard-drink [https://perma.cc/4M3E-D397].

[145] U.S. Const. amend. V. This right is mirrored and imposed on states through identical language in the Fourteenth Amendment.

[146] Kent v. Dulles, 357 U.S. 116, 125 (1958).

[147] Saenz v. Roe, 526 U.S. 489, 498 (1998) (citing United States v. Guest, 383 U.S. 745, 757 (1966)). See also Guest, 383 U.S. at 758 (citing Zechariah Chafee, Three Human Rights in the Constitution of 1787, at 15 (1956)) (“The reason [for the right’s omission from the Constitution], it has been suggested, is that a right so elementary was conceived from the beginning to be a necessary concomitant of the stronger Union the Constitution created.”).

[148] Articles of Confederation of 1781, art. IV, para. 1.

[149] Saenz, 526 U.S. at 500.

[150] Roger I. Roots, The Orphaned Right: The Right to Travel by Automobile, 1890–1950, 30 Okla. City U. L. Rev. 245, 267 (2005).

[151] Saenz, 526 U.S. at 501.

[152] 314 U.S. 160 (1941).

[153] Id. at 171.

[154] Id. at 174.

[155] See United States v. Guest, 383 U.S. 745 (1966).

[156] See id. at 757–60.

[157] Town of Castle Rock v. Gonzales, 545 U.S. 748, 756 (2005) (citing Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 577 (1972)).

[158] Paul v. Davis, 424 U.S. 693, 709 (1976) (quoting Roth, 408 U.S. at 577).

[159] See, e.g., N.Y. Veh. & Traf. § 1193(g)(2)(2)(b) (McKinney 2017) (outlining revocations based on offense).

[160] Notably, many of these revocations and bans stem from alcohol-related incidents. See, e.g., N.Y. Comp. Codes R. & Regs. tit. 15, §136.5 (2017) (if “the person has five or more alcohol—or drug-related driving convictions or incidents in any combination within his or her lifetime, then the Commissioner shall deny the application.”).

[161] Roth, 408 U.S. at 577.

[162] Cf. Sherbert v. Verner, 374 U.S. 398, 406 (1963); Bates v. Little Rock, 361 U.S. 516, 524 (1960); Korematsu v. United States, 323 U.S. 214, 216 (1944); Skinner v. Oklahoma, 316 U.S. 535, 541 (1942) .

[163] Motor Veh. Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co. (“State Farm”), 463 U.S. 29, 42 (1983).

[164] Jeremy B. Smith, The Flaws of Rational Basis with Bite: Why the Supreme Court Should Acknowledge Its Application of Heightened Scrutiny to Classifications Based on Sexual Orientation, 73 Fordham L. Rev. 2769, 2773–74 (2005).

[165] See, e.g., Bolling v. Sharpe, 347 U.S. 497, 498 (1954).

[166] United States v. Carolene Products Co., 304 U.S. 144, 152 n.4 (1938).

[167] City of Cleburne v. Cleburne Living Ctr., 473 U.S. 432, 440 (1985) (discussing the strict scrutiny test, but applying rational basis with bite).

[168] Russell Spivak & Adam Aliano, G.I. Jane and the Selective Service: Equal Protection Challenges to Male-Only Selective Service in the Modern Military, Harv. J. on Legis. Online (Aug. 5, 2016),

https://harvardjol.com/2016/08/05/gi-jane-and-the-selective-service-equal-protection-challenges-to-male-only-selective-service-in-the-modern-military/ [https://perma.cc/UFF7-TXS4].

[169] 440 U.S. 568 (1979).

[170] Id. at 592.

[171] Id. at 578.

[172] Gayle Lynn Pettinga, Rational Basis with Bite: Intermediate Scrutiny by Any Other Name, 62 Ind. L.J. 779, 780 (1987).

[173] City of Cleburne v. Cleburne Living Ctr., 473 U.S. 432, 450 (1985).

[174] 413 U.S. 528, 543 (1973).

[175] 483 U.S. 587, 603 (1987) (describing a three-pronged inquiry: 1) “As a historical matter, [has the group been] subjected to discrimination”; 2) do they “exhibit obvious, immutable, or distinguishing characteristics that define them as a discrete group”; and 3) are they “a minority or politically powerless”).

[176] Lawrence v. Texas, 539 U.S. 558, 580 (2003) (O’Connor, J., concurring).

[177] Smith, supra note 162, at 2774.

[178] See, e.g., Tom Wilson, Alcoholism and Disability Discrimination: Lessons from the USC Coach’s Case, 28 Emp. L. Comment. 1, 1–2 (2016); Paul Samuels, Fighting Discrimination Against People in Recovery from Alcoholism and Drug Addiction, HBO: Addiction, https://www.hbo.com/addiction/stigma/53_fighting_discrimination.html [https://perma.cc/AN2B-RZZN].

[179] Joel Roberts, 30% Of Americans Abuse Alcohol, Study Says, CBS News (July 2, 2007), http://www.cbsnews.com/news/30-of-americans-abuse-alcohol-study-says/ [https://perma.cc/VQ6W-EGMX].

[180] Cass R. Sunstein, Naked Preferences and the Constitution, 84 Colum. L. Rev. 1689, 1713 (1984). See also Smith, supra note 162, at 2773 (citing FCC v. Beach Commc’ns, Inc., 508 U.S. 307, 313 (1993)) (“As the Supreme Court has noted, a classification ‘must be upheld against equal protection challenge if there is any reasonably conceivable state of facts that could provide a rational basis for the classification.’”).

[181] U.S. Const. amend. IV.

[182] What’s more, even if the argument can be stretched to assert a search has been made, one voluntarily chooses to drive. Therefore, the response can be lodged that choosing to drive subject to a breathalyzer constitutes consent to be searched, which is lawful under Supreme Court precedent so long as the search does not exceed the scope of the consent. See Schneckloth v. Bustamonte, 412 U.S. 218, 248 (1973); Bumper v. North Carolina, 391 U.S. 543, 549–50 (1968).

[183] Burdeau v. McDowell, 256 U.S. 465, 475 (1921).

[184] 136 S. Ct. 2160 (2016)

[185] Id. at 2177.

[186] Florida v. Jimeno, 500 U.S. 248, 250 (1991) (citing Katz v. United States, 389 U.S. 347, 360 (1967)).

[187] See, e.g., Jones v. Rath Packing Co., 430 U.S. 519, 543 (1977).

[188] See Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947) (noting “the assumption that the historic police powers of the States [are] not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress”).

[189] See Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996). See also David Luban, Lawfare and Legal Ethics in Guantánamo, 60 Stan. L. Rev. 1981, 2009 (2008) (“It is no answer to say that under the Supremacy Clause federal rules preempt inconsistent state rules, because it is radically unclear whether, absent clear congressional intent to preempt, federal rules in an area traditionally regulated by the states do indeed preempt state rules.”).

[190] English v. Gen. Elec. Co., 496 U.S. 72, 79 (1990).

[191] Altria Grp. v. Good, 555 U.S. 70, 77 (citing Bates v. Dow Agrosciences LLC, 544 U.S. 431, 449 (2005)).

[192] Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142–43 (1963).

[193] Rice, supra note 186, at 231.

[194] Todd S. Schulman, Wisdom Without Power: The Department of Justice’s Attempt to Exempt Federal Prosecutors from State No-Contact Rules, 71 N.Y.U. L. Rev. 1067, 1085 (1996) (quoting Malone v. White Motor Corp., 435 U.S. 497, 504 (1978)).

[195] See Background on: Compulsory Auto/Uninsured Motorists, Ins. Info. Inst., www.iii.org/issue-update/compulsory-auto-uninsured-motorists [https://perma.cc/PL5A-Q2NE].

[196] N.H. Rev. Stat. Ann. § 3:8 (2016).

[197] See Insurance Requirements/SR-22, N.H. Div. of Motor Vehicles, N.H. Dep’t. of Safety, https://www.nh.gov/safety/divisions/dmv/financial-responsibility/insurance.htm [https://perma.cc/XD8K-8M86].

[198] See How Many Drivers Don’t Have Auto Insurance?, AutoInsurance.org, http://www.autoinsurance.org/how-many-drivers-dont-have-auto-insurance/ [https://perma.cc/73BQ-7NVG] (noting that only eleven percent of New Hampshire drivers do not have auto insurance).

[199] See Legislative history of .08 Per Se Laws, supra note 30, at 16 (“Insurance companies such as Allstate Insurance, Kemper Insurance Group, Nationwide Insurance, and USAA Insurance, among others, have publicly expressed their support for .08 per se laws” compared to higher BAC limits.).

[200] If the manufacturer was particularly cunning, it could even choose to design the IID such that it is exclusively serviceable at one of the manufacturer’s authorized service providers.

[201] See, e.g., 2017 Prius Features, Toyota, http://www.toyota.com/prius/prius-features/#!/toyota-safety-sense/toyota-safety-sense-p-tss-p [https://perma.cc/9E73-DKJG].

[202] See Plug-In Electric Drive Vehicle Credit (IRC 30D), Internal Revenue Serv., https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d [https://perma.cc/B4PM-CN2B].

[203] See, e.g., Volt, Chevrolet, http://www.chevrolet.com/previous-year/volt-plug-in-hybrid [https://perma.cc/FCW5-5RFC].

[204] Impaired Driving: Get the Facts, supra note 3.

Participation in Name Only: How Section 2 of the Voting Rights Act Can Present a Meaningful Challenge to Big Money in Politics

By Jonathan Topaz, JD ’18[*]

“No, Jim Crow is not dead. It’s not quite dead. It now focuses its energy in different areas. Instead of literacy tests or poll taxes, the new way to deny adequate representation is to allow us to vote for any candidate we want so long as they’re rich. We have a long way to go.”[1] – Clayton Harris, former President, Howard Law Student Bar Association

I. Introduction

If the fierce battle over money in U.S. politics between libertarians and campaign finance reform advocates is a tennis match, the Supreme Court has forced the latter to play with a wooden racket or broken strings. In the landmark case Buckley v. Valeo, the Court found that campaign expenditures to influence elections amount to First Amendment-protected political speech[2]—meaning the government must prove it has a compelling interest to justify any campaign finance restrictions.[3] Buckley’s decision has been a tremendous boon for the libertarian side, which has pummeled reformers with constitutional free speech arguments to loosen campaign finance regulations. Buckley also rejected a “political equality” justification for campaign finance restrictions, stating instead that the government has a sufficiently important interest to prevent only corruption or the appearance of corruption.[4] The Court has interpreted “corruption” as meaning “quid pro quo corruption”[5]—an incredibly narrow interpretation that seemingly condones anything beyond literal bribery. The Supreme Court has thus effectively neutered reformers looking to impose campaign finance regulations that go beyond the almost non-existent problem of quid pro quo corruption.[6]

Consequently, until the Supreme Court overturns Buckley and rules that political equality is a legitimate governmental interest for campaign finance regulations, reformers would benefit from finding a separate governmental interest to support campaign finance reforms that is more widespread and documentable than quid pro quo corruption.[7] More and more evidence has piled up that the current libertarian system of financing elections in the U.S. overwhelmingly benefits white people, who make up a disproportionate percentage of top donors and elected officials relative to the population. In turn, the influx of money in politics has worked to decrease the political influence and participation of less affluent nonwhite communities.

This paper argues that reformers should seize on a new governmental interest to attack campaign finance laws: ensuring nonwhite voters have the opportunity to participate meaningfully in the political process and to elect their preferred representatives. Congress has a broad statutory mandate to ensure this interest in Section 2 of the Voting Rights Act (VRA), which Congress passed to enforce the voting rights provisions of the 14th and 15th Amendments.[8] Thus, this paper presents a potentially compelling legal argument for reformers: current libertarian campaign finance laws violate Section 2 and the government’s compelling interest in ensuring that nonwhite voters have an equal ability to participate in the political process.

First, this paper will introduce the relevant language of Section 2, the so-called Gingles factors that create the presumption for a majority-minority district, and the Senate Judiciary Committee factors that indicate potential Section 2 violations. Second, this paper will discuss existing campaign finance data to support two factual claims: A) top donors, who have a significant influence on policy, are far whiter and more conservative than average Americans; and B) money in politics adversely impacts minority representation in elected office.

Third, this paper will present two different legal approaches for how reformers can use Section 2 to target big money in politics. One legal argument states that the current libertarian campaign finance system endangers nonwhite voters’ ability to elect the candidates of their choosing in primary elections in majority-minority districts, which are legally protected by Section 2. Several case studies show that better-financed, white-preferred candidates have won or nearly won primaries against the nonwhite majority’s preferred candidate—a strong suggestion that big money in politics infringes on majority-minority districts as a Section 2 remedy. For this first argument, reformers would bring litigation in districts for which Section 2 requires a majority-minority district, but where better-financed, white-preferred candidates have won primaries despite people of color comprising a voting majority. The other legal argument states that current libertarian campaign finance laws run afoul of Section 2 more broadly, as evidenced by their violation of three Senate Judiciary Committee Report factors. These two legal claims provide the infrastructure for future litigation arguing that libertarian campaign finance laws violate Section 2’s guarantee that nonwhite voters have the ability to participate meaningfully in the political process. Reformers here should initially target jurisdictions that are particularly receptive to racial justice claims. Fourth, this paper will argue that reformers should not just seek to uphold existing campaign finance restrictions but also seek injunctions that would require states or localities to institute some form of public financing or matching system in the event of a Section 2 violation.

II. The Law: Section 2, Gingles, and the Senate Judiciary Report Factors

Section 2 of the VRA states that “[n]o voting qualification or prerequisite to voting or standard, practice, or procedure shall be imposed or applied by any State or political subdivision in a manner which results in a denial or abridgement of the right of any citizen of the United States to vote on account of race or color.”[9] The statute then states that this provision is violated “if, based on the totality of circumstances, it is shown that the political processes leading to nomination or election in the State or political subdivision are not equally open to participation by members of a class of citizens protected by subsection (a) in that its members have less opportunity than other members of the electorate to participate in the political process and to elect representatives of their choice.”[10]

Challenges to libertarian campaign finance laws under Section 2 would constitute vote dilution claims, not vote denial claims. A vote dilution claim is such “that a certain electoral law, practice, or structure interacts with social and historical conditions to cause an inequality in the opportunities enjoyed by black and white voters to elect their preferred representatives.”[11] Most vote dilution claims concern the impact on nonwhite participation of multimember districts, at-large voting schemes, and reapportionment plans;[12] this paper argues that current libertarian campaign finance laws are practices that dilute nonwhite participation and voting strength.

Section 2 explicitly does not create a “right to have members of a protected class elected in numbers equal to their proportion in the population.”[13] But the statute does concern a fundamental representation problem: given that the United States does not have proportional representation and instead has winner-take-all districts, large nonwhite groups might lack the necessary political coalitions to elect their preferred candidates. Thus, the past several decades have seen the proliferation of court-mandated majority-minority districts, districts in which nonwhite voters make up more than 50 percent of the voting-age population.[14]

In Thornburg v. Gingles, the Supreme Court ruled that, in a districting context, plaintiffs must establish three factors to satisfy the prima facie vote dilution claim under Section 2.[15] Plaintiffs must prove that the minority group is “sufficiently large and geographically compact” to support a district-wide majority, that the minority group is politically cohesive, and that the white majority itself votes sufficiently as a bloc to defeat the minority group’s preferred candidates on a consistent basis.[16] Once plaintiffs pass this threshold test, courts must then determine, according to the totality of the circumstances, whether there is a Section 2 violation.[17] In doing so, courts must also consider the nine factors in the Senate Report accompanying the 1982 VRA amendments.[18] Courts have broadly interpreted Gingles as compelling states to create a majority-minority district in instances where the Gingles factors are met and a court finds a Section 2 violation.[19]

For the purposes of this paper’s second legal argument, there are three particularly salient factors listed in the 1982 Senate Report. The fourth Senate factor is “if there is a candidate slating process, whether the members of the minority group have been denied access to that process.”[20] While neither the statute nor the Senate Report explicitly defines slating, courts generally view it as “a process in which some influential non-governmental organization selects and endorses a group or ‘slate’ of candidates, rendering the election little more than a stamp of approval for the candidates selected.”[21] The fifth Senate factor is “the extent to which members of the minority group in the state or political subdivision bear the effects of discrimination in such areas as education, employment and health, which hinder their ability to participate effectively in the political process.”[22] Finally, the seventh Senate factor is “the extent to which members of the minority group have been elected to public office in the jurisdiction.”[23]

III. The Current Legal Structure Disproportionately Helps White Donors and Candidates

“[Campaign finance] is a civil rights problem, because it is a problem of political participation. . . . Because the people who call the tunes, who are the funders, are primarily white.”[24] – Guy-Uriel Charles, Director, Duke Law Center on Law, Race and Politics

It is important to establish briefly two background claims: 1) there has been a significant growth in money in politics in the past several decades; and 2) libertarian campaign finance laws are at least partially responsible for this growth. Indeed, the cost of running for Congress has increased by 555 percent since 1984.[25] Outside group spending increased from $100 million in 2000 to $980 million in 2012 in inflation-adjusted amounts,[26] while political spending from outside non-disclosing groups increased from $5 million in 2006 to more than $300 million in 2012.[27] Outside spending—virtually nonexistent before 2008—made up $1.5 billion of independent expenditures in the 2016 election cycle, up 33 percent just from 2012.[28] Buckley’s 1976 prohibition on campaign finance reforms for political equality purposes has contributed greatly to the exponential growth in money in politics in the past four decades and has time and again prevented meaningful reforms, such as statewide expenditure limits.[29] More recently, Citizens United in 2010 extended Buckley’s claim that expenditures are protected speech under the First Amendment to corporations and unions, allowing them to spend unlimited amounts of money on elections.[30] The D.C. Circuit ruled later that year that if independent expenditures do not amount to quid pro quo corruption or its appearance, then contributions to groups who make those expenditures cannot amount to quid pro quo corruption or its appearance.[31] This spawned the creation of super PACs, heavily responsible for the recent dramatic rise in outside spending. There are two main ways that the recent spike in campaign spending—enabled by the libertarian regulatory environment—impacts communities of color.

A. Top Donors, Who Have a Significant Influence on Policy, Are Far Whiter and More Conservative Than Average Americans

Put simply, top donors—who are pouring more money into elections than ever before—are extremely white. Ninety-three percent of donors who gave more than $5,000 in the 2012 election cycle were white, as were 94 percent of donors who gave more than $5,000 in 2014.[32] Black people, who make up roughly 13 percent of the population, constituted just three percent of top donors in 2012 and two percent in 2014.[33] Campaign finance data from many state[34] and local[35] elections have found the same thing: top donors are heavily white. Thus, whites make up a disproportionate percentage of the so-called economic elites who dominate the donor class. These top donors have increased their influence considerably in recent years—nearly 42 percent of total campaign contributions in 2012 came from the top .01 percent of wealthiest donors, compared to 12.8 percent in 1990.[36]

Additionally, several studies show that these top donors are more conservative than average Americans on a host of issues—educational equality, taxation, regulation, welfare, health care, the minimum wage, college affordability, racial justice, and whether government policies favor the wealthy.[37] Another study also shows that, while Democratic donors are fairly representative of average Democratic donors, Republican and independent donors are far more conservative than Republican and independent voters, respectively.[38] And while there is no clear data showing causation, there are strong indications that top donors wield considerable influence on policymakers to pursue these preferred policies. States that have stricter campaign finance laws spend a larger percentage of their annual budgets on public welfare spending and cash assistance programs, even when accounting for differences in ideology and legislature partisanship.[39] Martin Gilens and Benjamin Page have famously found that there is essentially no correlation between the policy preferences of average citizens and the likelihood that those policy preferences will be implemented, while economic elites “have a quite substantial, highly significant, independent impact on policy.”[40] Therefore, the data indicate that top donors, heavily white and conservative, exercise a more significant effect on policy than average voters.

Importantly, several studies have found that nonwhite groups participate less in politics because they have fewer resources, not because of lack of interest or “voluntary abstention.”[41] These studies preemptively rebut those who would argue that communities of color have an equal ability to influence elections, but decline to do so. The disproportionately low contribution total in nonwhite communities is a problem of access, not voter apathy.

B. Money in Politics Negatively Affects Minority Representation in Elected Office

People of color are underrepresented in elected office. Blacks comprise 13.3 percent of the U.S. population, but make up 8.8 percent of the membership of the current Congress and 8.6 percent of state legislature membership.[42] Hispanics comprise 17.6 percent of the population, but make up 7 percent of Congress and 4.8 percent of state legislators.[43] Whites make up 90 percent of elected leaders despite comprising less than 62 percent of the population.[44]

Candidates of color raise far less money than do their white counterparts.[45] For example, candidates of color in 2006 state legislature races raised 47 percent less than white candidates, even when controlling for all other factors.[46] Similarly, black candidates raised less than one percent of the total money raised by congressional candidates in 2000, despite making up about seven percent of Congress.[47] Data indicate that economic resources are a statistically significant “important factor” in determining how many black candidates will run for office,[48] and nearly two-thirds of both whites and blacks believe that fewer candidates of color run successfully for office because they lack the financial networks necessary to raise enough money for a run.[49] When big money is necessary to run for office, personal wealth (and access to personal wealth through social networks) becomes an important factor. Indeed, the median net worth for a member of Congress in 2013 was $1.03 million, 18 times that of the average American household.[50] Similarly, elected officials nationwide are vastly more likely to be millionaires and much less likely to have been raised in a working-class family than average Americans.[51] Relatedly, the institution of public financing or matching systems in Connecticut, Arizona, and New York City has coincided with greater candidate diversity and major increases in nonwhite state and local legislators.[52] States with stricter campaign finance laws also elect more legislators from poorer backgrounds and pursue more redistributivist policies.[53]

Part III thus indicates that money currently plays a bigger role in elections than ever in modern American history, that the current libertarian campaign finance legal and regulatory environment is at least partially responsible for the importance of money in politics, and that people of color are disproportionately unrepresented among the major donors and elected officials in the modern political climate. Part III also indicates that candidates of color are unable to raise as much money as their white counterparts when they do run, and that people of color donate less to political campaigns because of fewer resources, not lack of interest. These facts all show that the current libertarian campaign finance legal system broadly prevents nonwhite communities from electing the candidates of their choice and from equally influencing the political process. With the findings in Part III as crucial evidence, this paper now moves to its two core Section 2 legal arguments designed to challenge libertarian campaign finance laws.

IV. LEGAL ARGUMENT ONE: Campaign Finance Laws Subvert Nonwhite Political Influence in Majority-Minority Districts

Part II established that courts have widely interpreted Gingles as stating that it is often a legally necessary remedy to create a majority-minority district in the event of a Section 2 violation.[54] In Part III, this paper noted that candidates of color, underrepresented in elected office, raise less money than white candidates[55]—an electorally significant finding given that better-financed candidates won at least 91 percent of congressional races in both 2012[56] and 2008.[57] Therefore, it is likely that current libertarian campaign finance laws can violate Section 2 by undermining the efficacy of majority-minority districts designed to ensure that communities of color can elect their preferred representatives.

Given the significant historical and current overlap between race and party, majority-minority districts tend to skew heavily Democratic and do not often have competitive general elections.[58] As such, it is better to analyze congressional primaries in majority-minority districts. Primaries also provide an insightful look into campaign finance because candidates must raise a significant amount of money to be considered credible. (As this paper will explore later, there is natural overlap between the slating process and the wealth primary in the early campaign stages.)

The ideal case study is as follows: a better-financed, white-preferred candidate that defeats (or narrowly loses to) the nonwhite-preferred candidate in a primary in a majority-minority district. Recent history provides some examples.

Texas’ 29th District, which today is 75 percent Hispanic, has not elected a Hispanic member since the majority-minority district was created in 1991.[59] In 1992, Gene Green, who is white, defeated Hispanic Ben Reyes in the Democratic primary runoff by 180 votes.[60] Green received $180,708 from the National Rifle Association during the primary campaign, which the Washington Post would later say was a potentially decisive factor in Green’s narrow victory.[61] Former Houston Councilman John Castillo said of the race: “Green had all of the NRA money. The NRA spent more money on Gene Green than on any other incumbent or non incumbent Democrat running for Congress. Secondly, in spite of the fact that Ben carried all of labor’s water in the legislature, they turned on him. And went for Green simply because he is Anglo. . . . Ben [was] running without as much money.”[62] Green still represents the 29th District today.

In Alabama’s 7th Congressional District runoff in 2002, the moderate Artur Davis defeated Earl Hilliard in a contentious primary between two black men. The runoff was, in many ways, centrally about race. Hilliard was a favorite of the black establishment and campaigned with civil rights leaders such as Al Sharpton.[63] Hilliard, who was endorsed by the Congressional Black Caucus, publicly questioned whether Davis was “black enough” to represent the district.[64] Davis, meanwhile, raised a significant amount of money from out-of-district white Jewish donors who criticized Hilliard’s stance on Israel;[65] Davis received more than $133,000 from private fundraisers in New York City alone.[66] Indeed, Davis outraised Hilliard, which helped him reduce the incumbent’s early lead.[67] The premier local organization of black Democrats complained about Davis’s out-of-district contributions from pro-Israel groups[68] and, after the race, Hilliard also commented: “My opponent had a massive amount of money. I don’t know what that means for the future for other persons who are similarly situated.”[69] Davis, who became the only CBC member to vote against the Affordable Care Act, famously later joined the Republican Party.[70]

Finally, David Yassky—a white Democrat who moved to New York’s then-majority-black 11th District to run for the open seat[71]—only narrowly lost to black candidate Yvette Clarke in the 2006 primary.[72] Black leaders criticized Yassky for being an opportunist and trying to win a majority-black district.[73] Just months before the primary, Yassky had raised more money to that point than all his primary challengers—all black—combined.[74]

These case studies all underscore a similar point: the unregulated way that money has flooded into politics greatly impedes the ability for communities of color to elect the candidates of their choosing. These examples are particularly potent because they show how money in politics can distort two core voting rights principles. First, they demonstrate that citizens of color do not have an “equally effective voice” in electing their representatives—as the Supreme Court guaranteed in Reynolds v. Sims[75]—given that the preferences of a smaller, well-financed group of people can trump the preferences of the nonwhite majority. The fact that Davis, for example, received big money from individuals and groups outside his district further underscores this point. The free flow of unregulated big money allows top white donors around the U.S. to pool money with an individual district’s wealthy white minority to outraise a nonwhite group’s preferred candidate. Second, these cases—while somewhat rare—demonstrate how money in politics imperils one of the guarantees and hallmarks of Section 2: majority-minority districts. If money in politics prevents a nonwhite majority from electing its preferred candidate, the state in question has not executed a proper remedy for a Section 2 violation under Gingles.

To be sure, there are many complications with a legal challenge based on the majority-minority district theory. For one, it may be difficult to prove decisively who the “minority-preferred candidate” is—as this paper will show later, Section 2 does not consider the race of the candidate to be a defining factor in this equation.[76] Additionally, plaintiffs likely must show that the white-preferred candidate’s fundraising advantage was a causal factor in his victory. Still, if litigation can successfully prove that a white-preferred candidate’s fundraising advantage contributed significantly to a victory in a majority-minority district, that would create a compelling and wide-ranging claim that the current libertarian campaign finance system imperils Section 2’s core remedy to ensure its promise of effective representation.

V. LEGAL ARGUMENT TWO: The Libertarian Campaign Finance Legal System Dilutes Nonwhite Political Influence, as Evidenced by Three Senate Factors

“A political process based on private money gives wealthier white communities disproportionately large influence in determining all candidates, and, like the lines drawn for some electoral districts, it effectively excludes poorer minorities from meaningful participation in the selection of their representatives.” – Spencer Overton[77]

Part IV worked within the Gingles framework to argue that money in politics neutralizes the power of majority-minority districts to ensure nonwhite groups can elect the candidates of their choice. That argument states that money in politics unlawfully nullifies the mandated remedy when a Section 2 violation has already been established using the Gingles test.

This section instead focuses on a slightly different framework. Districting cases, after all, are factually different than campaign finance questions—Gingles’ stringent three-part threshold test need not necessarily apply to Section 2 challenges to the libertarian campaign finance system. Generally, Gingles states that Section 2 guarantees remedies for unequal access to the political process: “The essence of a §2 claim is that a certain electoral law, practice, or structure interacts with social and historical conditions to cause an inequality in the opportunities enjoyed by black and white voters to elect their preferred representatives.”[78] Thus, some lawyers[79] have begun exploring Section 2 money-in-politics challenges that do not abide by the formulaic Gingles test, whose factors make more sense for a districting fact pattern. The argument in this section focuses on Section 2’s broader promise of a political process that ensures equal opportunity for nonwhite groups to participate and elect preferred representatives. This section will now look at three of the 1982 Senate Report factors to demonstrate how unregulated money in politics violates these three factors such that it could constitute a Section 2 violation.

A. Slating (Factor Four)

First, the so-called wealth primary creates an informal slating process that disadvantages minority-preferred candidates and effectively disallows members of a nonwhite group from participating in the candidate selection process. Ellen Katz has classified four different types of slating that courts have considered in Section 2 challenges since the 1982 amendments; the wealth primary qualifies as what Katz calls “private slating” or informal slating.[80] Katz defines this type of slating as “conduct by private organizations [denying] minority candidates access to slating processes.”[81] The wealth primary is not an example of “official slating,” which would constitute formal barriers to slating processes for minority-preferred candidates, or “unofficial party slating,” implicating decisions made by party officials.[82] Instead, because minority-preferred candidates either do not have contact with many top donors or because they do not support the policy positions of those top donors,[83] these candidates are often informally but effectively shut out from the slating process that “[controls] effective access . . . to the ballot.”[84]

This principle perhaps was best summarized recently in Missouri State Conference of the NAACP v. Ferguson-Florissant School District, a case involving the school district where Michael Brown lived.[85] The court found that there were two powerful slating organizations that endorsed more white candidates than black candidates, which was predictive of electoral success.[86] As such, the court stated that “African Americans have much less success than white candidates in receiving the established slating groups’ endorsements, and in that sense, they are largely denied meaningful access to those slating groups.”[87] In other words, while nonwhite-preferred candidates were not formally denied access to the slating process, they were effectively denied meaningful access such that they had less ability to launch a successful campaign. This case provides a perfectly analogous argument for how the wealth primary excludes nonwhite communities from the slating process. In Part III.B, this paper showed that nonwhite candidates struggle to raise as much money as white candidates, regardless of merit. And given the modern reality of the libertarian campaign finance environment, raising money is increasingly important—successful House candidates in 2012 raised on average $1.6 million, 344 times more than what was required in 1986.[88] Thus, if nonwhite candidates are disproportionately denied access to top donors, and those donors are disproportionately comprised of white people (whose interests largely diverge from those of non-white voters[89]), unregulated campaign finance mechanisms act as a significant barrier toward the election of nonwhite-preferred candidates and the political influence of nonwhite voters.

Courts have found other informal slating violations. In Citizens for a Better Gretna v. City of Gretna, the court found a discriminatory slating process when black candidates were not invited to a meeting with members of a nonpartisan candidate recruiting group.[90] Another case in Texas objected to a slating practice in which influential advocacy group made significant donations disproportionately to white candidates.[91] The latter case in particular, Perez, explicitly connects slating, endorsements, and contributions—after all, what is a campaign contribution other than a way to support a candidate that an individual or group has endorsed?[92] Given the evidence documented in Part III, it is clear that nonwhite groups do not have meaningful access to candidate slating processes, in violation of factor four.

B. Effects of Discrimination (Factor Five)

Second, the legacy of discrimination and segregation has resulted in economic disparities that prevent nonwhite voters from participating equally in the political process, both through campaign contributions and other activities. Senate Report factor five mostly concerns the phenomenon addressed in Part III.A—that top donors, who wield significant authority in candidate selection and policy influence, are disproportionately white. Courts across the U.S.—in Virginia,[93] Tennessee,[94] Georgia,[95] Missouri,[96] Texas,[97] and elsewhere—have found that legacies of housing and economic discrimination have prevented nonwhite voters from amassing the wealth necessary to contribute meaningfully to candidates. These courts have often noted that nonwhite-preferred candidates had received far fewer campaign contributions, in large part because the nonwhite communities did not have as much money to donate.[98] In this way, courts often draw direct connections between economic inequality and political participation, provided that plaintiffs can point to some evidence of historical or current discrimination.[99]

Senate Report factor five, though, also implicates the problem in Part III.B.—that nonwhite candidates are underrepresented in elected office in large part because they raise less money than white candidates. In Chisom v. Roemer, the district court found a Section 2 violation for voter dilution in Louisiana judicial elections, stating: “The relatively lower economic status of local black residents further affects accessibility to better education and such practicalities as campaign funding. . . .black candidates have considerable difficulty raising campaign funds and [generally], the better funded candidates win.”[100] Courts in Tennessee[101] and Texas[102] have also found that historical and continuing economic and employment discrimination prevented nonwhite candidates from being able to run successful political campaigns. In one particularly intriguing opinion, a Virginia court found that the long history of segregation along social lines in Nottoway County—at church, in Little League, in social clubs—still existed such that blacks and whites had little contact with one another.[103] The court found that this “societal separation” impaired black candidates’ ability to earn white support.[104] Similarly, a South Carolina court found that housing, religious, business, and social segregation “makes it especially difficult for African-American candidates seeking county-wide office to . . . communicate with the predominantly white electorate from whom they must obtain substantial support.”[105]

It is this last point in particular that draws an important link between slating (factor four) and effects of discrimination (factor five). Neal, Charleston County, and Terrell in particular note how voters are segregated in Little League, churches, clubs, housing, and civic organizations. This sort of “social segregation” is an offshoot of economic segregation—potential nonwhite candidates are often not included in the informal social circles of top donors from whom they must earn support to raise a sufficient amount of money.

Once plaintiffs establish that past discrimination is responsible for socioeconomic disparities along racial lines, the burden shifts to defendants to prove that depressed nonwhite political participation is based on voter apathy or other reasons not related to those disparities.[106] Plaintiffs need not show a “causal connection between depressed socioeconomic status and decreased opportunity to effectively participate in the political process.”[107] The Ninth Circuit has also found that “structural barriers” to electoral participation are not required for plaintiffs to prove a factor five violation.[108] Accordingly, there is a significant amount of case law stating that economic disparities related to discrimination preclude nonwhite groups from participating meaningfully in the electoral process. This argument is directly transferrable to a Section 2 challenge based on campaign finance regulations.

C. Election to Public Office (Factor Seven)

Third, as seen in Part III.B, the disproportionately low rate at which nonwhite candidates are elected to office is a strong indicator that nonwhite groups do not have a meaningful or equal opportunity to elect the candidates of their choosing. Factor seven does have some problematic elements that perhaps make it a less optimal fit than factors four and five. For one, Section 2 itself states explicitly that nonwhite groups are not entitled to any specific proportion of elected officials based on population.[109] Several courts have cited this provision to reject proportionality arguments, which can reduce the potency of a factor seven claim.[110] Perhaps more importantly, Section 2 only refers to nonwhite-preferred candidates, while factor seven refers to nonwhite candidates—there is an important distinction in those two phrases (i.e. Artur Davis in Part IV) because the failure to elect nonwhite candidates does not necessarily constitute a Section 2 violation. Libertarians can also argue that white candidates are elected at higher rates due to the incumbency advantage, not race.[111]

But in a limited way, factor seven can be helpful in addressing a documented representation problem: minority and minority-preferred candidates are elected to office at lower rates than demographics would indicate. Courts have used factor seven in particularly egregious underrepresentation cases—for example, when no minorities had ever been elected to county-wide office[112] or when a sizeable minority group had been unable to get one person elected onto the City Commission for more than 70 years.[113] Also, while Section 2 does not protect strict proportionality, several courts have found a factor seven violation by appealing to minority representation far lower than the jurisdiction’s nonwhite population.[114] Some courts also have been sympathetic to the argument that fewer nonwhite candidates run for office because they rightly perceive that financial barriers would likely preclude them from winning.[115]

Ultimately, this last point is particularly crucial for the campaign finance context. To win on factor seven grounds, reformers will have to argue—marshaling the case law in this section and the data in Part III.B—that nonwhite candidates both run for office and win at significantly lower rates because they have less access to capital. This argument, of course, links up nicely with factors four and five, which concern nonwhite groups’ and their preferred candidates’ inability to mount successful campaigns in the current campaign finance environment.

For these Part IV cases, reformers can be more adventurous with jurisdiction. Part IV.C noted some states and districts had particularly egregious underrepresentation of nonwhite individuals; it would be beneficial for reformers to target some of those places where nonwhite candidates are excluded from informal slating processes or where white candidates dramatically outraise nonwhite candidates. Given that these legal arguments are new and experimental, it would be beneficial to bring cases in jurisdictions that are friendly to racial justice and/or campaign finance claims. California, for example, has its own statewide VRA that protects nonwhite groups’ ability “to elect the candidate of its choice or its ability to influence the outcome of an election” and lists many of the 1982 Senate Report factors, including factor five.[116] As such, California courts might be more receptive to adopting “meaningful electoral participation for nonwhite groups” as a legitimate governmental interest to restrict First Amendment-protected speech, either according to the state or federal VRA.

VI. Remedies

There are two main options with regard to potential remedies. The easier but less satisfying approach is litigation aimed at existing statutes—either striking down statutory increases in contribution limits or defending current campaign finance restrictions. For example, lawyers at Free Speech for People recently filed an amicus brief with the Ninth Circuit in Lair v. Motl, a case on appeal after a district court in Montana ruled that the state’s campaign finance regulations violated the First Amendment.[117] The brief, in part, stated that the regulations served a legitimate government interest in ensuring that the Native American population could participate meaningfully in the electoral process in Montana.[118]

The second, more adventurous approach would be to seek injunctive relief for courts to mandate that states institute some form of public financing or matching system. Plaintiffs would need to prove that public financing systems improve opportunities for meaningful nonwhite political participation. While the merits of public financing are beyond the scope of this paper, data show that public financing can diversify the donor pool,[119] increase the number of nonwhite candidates and elected officials,[120] increase the financial significance of small donors,[121] and prompt legislatures to pass more redistributivist policies preferred by nonwhite communities.[122]

Courts, of course, are reluctant about creating policy on the bench. That said, the Supreme Court has ruled that federal courts can grant prospective injunctive relief against a state even if it requires the state to spend money in the future.[123] Indeed, the Supreme Court has on several occasions compelled state legislatures to institute civil rights policies that would necessitate the state spending money. In Graham v. Richardson,[124] the Court mandated that two states provide welfare benefits for resident aliens. The Supreme Court also famously stated in the mid-1970s that federal courts could compel states to institute forced integration policies, within certain limitations.[125]

Reformers would do well to look to court-enforced busing as a model while pursuing their own affirmative remedies like court-enforced public financing systems. In both busing cases and the current campaign finance environment, there is formal legal neutrality—states did not institute formal school segregationist policies in the 1970s, just as libertarians have not instituted formal barriers to nonwhite candidates or nonwhite donors participating in the political process. Yet courts forced states to appropriate funds to implement busing programs because there was blatant segregation and inequality despite formal legal neutrality. It is incumbent on reformers to make a similar argument that, despite the absence of per se discriminatory campaign finance laws, the current libertarian legal structure has significant discriminatory effects.

VII. Conclusion

Section 2 will not change the state of money in politics tomorrow. The Roberts Court has sided decisively with the libertarians on campaign finance issues, and the First Amendment remains as significant an impediment to reform as it did immediately following Buckley in 1976. That said, it is possible that libertarians have overplayed their hand. The spike in income inequality in the U.S. has coincided with a corresponding spike in big money in politics, which increasingly underscores significant racial disparities in political contributions and ability to influence the political process. As presented particularly in Part III, there are very stark and real racial inequalities among political contributors and elected officials. Section 2 provides several enticing legal arguments—that go far beyond the narrow governmental interest of corruption—to attack a libertarian campaign finance system that disallows nonwhite voters from participating meaningfully in the political process and electing their preferred representatives.

 

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[*] J.D. Candidate, Harvard Law School; B.A., Brown University.

[1] Clayton Harris, Campaign Finance as a Civil Rights Issue, 43 How. L.J. 7, 9 (1999).

[2] 424 U.S. 1, 52 (1976).

[3] See Citizens United v. FEC, 558 U.S. 310, 340 (2010) (“Laws that burden political speech are subject to strict scrutiny, which requires the Government to prove that the restriction furthers a compelling interest and is narrowly tailored to achieve that interest.”) (internal quotations omitted).

[4] Buckley, 424 U.S. at 48–49 (“[T]he concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment.”).

[5] See, e.g., McCutcheon v. FEC, 134 S. Ct. 1434, 1441 (2014) (“Any regulation must instead target what the Court has called ‘quid pro quo’ corruption or its appearance. That Latin phrase captures the notion of a direct exchange of an official act for money. The hallmark of corruption is the financial quid pro quo: dollars for political favors.”) (internal citations omitted); Citizens United, 558 U.S. at 359.

[6] Lawrence Lessig, a Harvard Law professor, former presidential candidate, and campaign finance expert, has stated that “Buckley created an incredibly difficult regulatory environment” in which it would be difficult for any regulations to pass legal muster. Interview with Lawrence Lessig, Professor, Harvard Law Sch., in Cambridge, Mass. (Mar. 31, 2016).

[7] The Supreme Court has not found a legitimate governmental interest to justify campaign finance restrictions beyond “preventing corruption or the appearance of corruption.” McCutcheon, 134 S. Ct. at 1450. Still, the Court has not ruled out the possibility that there might be other potential interests that could justify campaign finance restrictions. See id.

[8] See Shaw v. Hunt, 861 F. Supp. 408, 438 (E.D.N.C. 1994) (“[T]he Voting Rights Act is a direct exercise of Congress’ broad constitutional power to enforce the provisions of the Fourteenth and Fifteenth Amendments”); see also South Carolina v. Katzenbach, 383 U.S. 301, 308 (1966).

[9] 52 U.S.C. § 10301(a) (2014).

[10] 52 U.S.C. § 10301(b) (2014).

[11] Thornburg v. Gingles, 478 U.S. 30, 47 (1986).

[12] See generally, e.g., Cofield v. City of LaGrange, 969 F. Supp. 749 (N.D. Ga. 1997) (at-large voting); McDaniels v. Mehfoud, 702 F. Supp. 588 (E.D. Va. 1988) (reapportionment plan); Neal v. Coleburn, 689 F. Supp. 1426 (E.D. Va. 1988) (single-member districts).

[13] 52 U.S.C. § 10301(b) (2014).

[14] See McNeil v. Springfield Park Dist., 851 F.2d 937, 945 (7th Cir. 1988).

[15] See 478 U.S. at 50–51.

[16] Id.

[17] See id. at 43. See also Sensley v. Albritton, 385 F.3d 591, 595 (5th Cir. 2004) (outlining the Gingles “two-part framework” of assessing the Supreme Court’s first three factors as a threshold test and then conducting a totality-of-the-circumstances analysis using the Senate factors).

[18] See Gingles, 478 U.S. at 43–45.

[19] Claudine Gay, Pub. Pol. Inst. of Cal., The Effect of Minority Districts and Minority Representation on Political Participation in California 8 (2001), http://www.ppic.org/content/pubs/report/R_601CGR.pdf [https://perma.cc/U9QR-JLGP].

[20] S. Rep. No. 97-417 (1982).

[21] Westwego Citizens for Better Gov’t v. Westwego, 946 F.2d 1109, 1116 n.5 (5th Cir. 1991).

[22] S. Rep. No. 97-417.

[23] Id.

[24] freespeechpeople, Money in Politics as a Civil Rights Issue: What Can We Learn from North Carolina, YouTube (Jan. 10, 2016), https://www.youtube.com/watch?v=wi98X7PmCjQ [https://perma.cc/B3BW-357V].

[25] Michael Scherer, Pratheek Rebala & Chris Wilson, The Incredible Rise in Campaign Spending, Time (Oct. 23, 2014), http://time.com/3534117/the-incredible-rise-in-campaign-spending/ [https://perma.cc/3AMV-HE2E].

[26] Thomas B. Edsall, Can Anything Be Done About All the Money in Politics?, N.Y. Times (Sept. 16, 2015), http://www.nytimes.com/2015/09/16/opinion/can-anything-be-done-about-all-the-money-in-politics.html [https://perma.cc/DRX2-X5FA].

[27] Outside Spending by Nondisclosing Groups, Cycle to Date, Excluding Party Committees, OpenSecrets, https://www.opensecrets.org/outsidespending/disclosure.php [https://perma.cc/Y7HN-Y7NU].

[28] Outside Spending by Cycle, Excluding Party Committees, OpenSecrets, https://www.opensecrets.org/outsidespending/fes_summ.php [https://perma.cc/FA3H-7CSG].

[29] See Randall v. Sorrell, 548 U.S. 230, 246 (2006) (finding Vermont’s expenditure limits violated the First Amendment).

[30] See generally Citizens United v. FEC, 558 U.S. 310 (2010).

[31] See generally Speechnow v. FEC, 599 F.3d 686 (D.C. Cir. 2010).

[32] Sean McElwee et al., Demos, Whose Voice, Whose Choice? The Distorting Influence of the Political Donor Class in Our Big-Money Elections 10 (2016), http://www.demos.org/sites/default/files/publications/Whose%20Voice%20Whose%20Choice_1.pdf [https://perma.cc/W3CY-8G6B].

[33] Id.

[34] Ninety-five percent of North Carolina’s largest donors for 2014 congressional races were white, while less than one percent were black. Alex Kotch, Inst. for S. Studies, The Face of Election Money in North Carolina: The Disconnect Between Changing Demographics and the Political Donor Class in a Battleground State 1–2 (2015), http://www.southernstudies.org/sites/default/files/ISS_Face-of-NC-Donors_2.pdf [https://perma.cc/FU8F-B38T]. In 2008, nearly 82 percent of contributions to New York State Assembly and Senate candidates came from zip codes that are predominantly white, where less than 70 percent of the state’s population lives. Pub. Pol’y & Educ. Fund, The Color of Money in New York: Contributions by Race, Ethnicity and Wealth 2006-2008 4–5 (2009), http://ppefny.org/wp-content/uploads/sites/17/2009/11/07192009RJColorofMoney.pdf [https://perma.cc/EZ5P-GBH3].

[35] In Chicago, whites make up 39 percent of the total population but were responsible for 88 percent of donations of more than $1,000 in the city’s 2015 mayoral race. Sean McElwee, Demos, How Chicago’s White Donor Class Distorts City Policy 1 (2016), http://www.demos.org/sites/default/files/publications/ChicagoPublicFinancing%20(Sean)_6.pdf [https://perma.cc/MT9D-WBB2]. Top donors to Miami’s 2016 mayoral and local elections were also disproportionately white and male. See Sean McElwee, Demos, Miami-Dade’s White Donor Class: How Big Donors Distort Democracy 4–5 (2016), http://www.demos.org/sites/default/files/publications/Miami-Dade%20White%20Donor%20Class_short%20acknowledgment.pdf [https://perma.cc/G36X-QHTT].

[36] CrowdPAC, How Much Do the 1% of the 1% Control Politics? (Apr. 21, 2015), https://www.crowdpac.com/blog/the-1-percent-of-the-1-percent [https://perma.cc/7HL3-L26F].

[37] See Benjamin I. Page, Larry M. Bartels & Jason Seawright, Democracy and the Policy Preferences of Wealthy Americans, 11 Persps. on Pol. 51, 55–64 (Mar. 2013), http://faculty.wcas.northwestern.edu/~jnd260/cab/CAB2012%20-%20Page1.pdf [https://perma.cc/4DDS-MEF2]; Adam Lioz, Demos, Stacked Deck: How the Racial Bias in Our Big Money Political System Undermines Our Democracy and Our Economy 15–18 (2014), http://www.demos.org/sites/default/files/publications/StackedDeck2_1.pdf [https://perma.cc/FB5Q-3K8T]; July 2013 Washington Post-ABC News Poll: Obama, GOP, Immigration and Health Care, Wash. Post (July 24, 2013), https://www.washingtonpost.com/politics/polling/july-2013-washington-postabc-news-poll/2013/07/24/0dceb4ba-f387-11e2-81fa-8e83b3864c36_page.html [https://perma.cc/D7CG-FCG2].

[38] Sean McElwee, Demos, Whose Voice, Whose Choice? The Disturbing Influence of the Political Donor Class in Our Big-Money Elections 43 (2016), http://www.demos.org/sites/default/files/publications/Whose%20Voice%20Whose%20Choice_2.pdf [https://perma.cc/3XY6-T753].

[39] Patrick Flavin, Campaign Finance Laws, Policy Outcomes, and Political Equality in the American States, 68 Pol. Res. Q., 77, 81 (2014), https://www.followthemoney.org/assets/Uploads/Flavin-2015-PRQ.pdf [https://perma.cc/EVR6-PBN4].

[40] Martin Gilens & Benjamin I. Page, Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens, 12 Persps. on Pol. 564, 572–73 (2014), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/62327F513959D0A304D4893B382B992B/S1537592714001595a.pdf/div-class-title-testing-theories-of-american-politics-elites-interest-groups-and-average-citizens-div.pdf [https://perma.cc/5MM8-W8N5].

[41] Sidney Verba, Kay Lehman Schlozman, Henry Brady & Norman H. Nie, Ethnicity and Political Resources: Participation in the United States, 23 Brit. J. Pol. Sci. 453, 467–69; 494 (1993). See also Verba et al., Voice and Equality: Civic Voluntarism in American Politics 235 (1995) (“When it comes to giving time, minority activists are not less active than their [white] counterparts. . . . .The situation is entirely different with respect to money.”).

[42] Jennifer E. Manning, Cong. Research Serv., R43869, Membership of the 114th Congress: A Profile 7 (2016), https://www.fas.org/sgp/crs/misc/R43869.pdf [https://perma.cc/44FK-X7RD]; Quick Facts, United States Census Bureau (July 1, 2016), https://www.census.gov/quickfacts/table/PST045215 [https://perma.cc/85UL-B3QM]; Legislators’ Race and Ethnicity 2015, Nat’l Conference of State Legislatures, http://www.ncsl.org/Portals/1/Documents/About_State_Legislatures/Raceethnicity_Rev1.pdf [https://perma.cc/YPQ4-V5EF] (last updated Apr. 7, 2016).

[43] See supra note 42 and accompanying text.

[44] Adam Lioz, Demos, Stacked Deck: How the Racial Bias in Our Big Money Political System Undermines Our Democracy and Our Economy 1 (2014), http://www.demos.org/sites/default/files/publications/StackedDeck2_1.pdf [https://perma.cc/FB5Q-3K8T].

[45] Jason P. Conti, The Forgotten Few: Campaign Finance Reform and its Impact on Minority and Female Candidates, 22 B.C. Third World L.J. 99, 109 (2002) (citing Jamin Raskin & John Bonifaz, Equal Protection and the Wealth Primary, 11 Yale L. & Pol’y Rev. 273, 279 n.26 (1993) (“[W]hen compared across districts and within districts, minority candidates, particularly challengers, are likely to raise much less money than white candidates and have less electoral success because of it.”).

[46] Laura Merrifield Albright, Am. Pol. Sci. Ass’n, Not Simply Black and White: The Relationship between Race/Ethnicity and Campaign Finance in State Legislative Elections 16-17 (2014).

[47] Robert Moore, Black Candidates See Little of the Millions Their Parties Raise, Ctr. For Pub. Integrity (Sept. 15, 2000, 7:23 PM), https://www.publicintegrity.org/2000/09/15/3269/black-candidates-see-little-millions-their-parties-raise [https://perma.cc/U2J4-F8W2]. It is worth noting that black candidates often represent safer districts, in large part because many represent majority-black districts. Given that political parties and donors in general prioritize competitive races, part of the reason that black incumbents raise less money is likely because they have disproportionately large margins of victory compared to their white counterparts.

[48] Paru Shah, It Takes a Black Candidate: A Supply-Side Theory of Minority Representation, 67 Pol. Res. Q. 266, 272 (2014).

[49] See generally Lioz, supra note 44.

[50] Alan Rappeport, Making it Rain: Members of Congress Are Mostly Millionaires, N.Y. Times, FirstDraft (Jan. 12, 2015, 5:54 PM), http://www.nytimes.com/politics/first-draft/2015/01/12/making-it-rain-members-of-congress-are-mostly-millionaires/ [https://perma.cc/RB8K-VXXF].

[51] Nicholas Carnes, White-Collar Government: The Hidden Role of Class in Economic Policy Making 4–6, 12 (2013).

[52] The number of Hispanic Connecticut state legislators increased by 33 percent in 2012, reaching its highest level in state history. J. Mijin Cha & Miles Rapoport, Demos, Fresh Start: The Impact of Public Campaign Financing in Connecticut 13 (2013), http://www.demos.org/sites/default/files/publications/FreshStart_PublicFinancingCT_0.pdf [https://perma.cc/6KED-SVB7]. Hispanic and Native American candidates in Arizona nearly tripled after two election cycles of implementation. Steven M. Levin, Keeping It Clean: Public Financing in American Elections, 95 Nat’l Civic Rev. 7 (2006). New York City in 2009 had a majority of nonwhite city councilmembers for the first time in its history. Angela Migally & Susan Liss, Small Donor Matching Funds: The NYC Election Experience, Brennan Ctr. for Justice 21 (2010), http://www.nonprofitvote.org/documents/2011/03/levin-keeping-it-clean.pdf [https://perma.cc/944Y-KL96].

[53] Patrick Flavin, Campaign Finance Laws, Policy Outcomes, and Political Equality in the American States, 68 Pol. R. Q., 77, 81–84 (2015), https://www.followthemoney.org/assets/Uploads/Flavin-2015-PRQ.pdf [https://perma.cc/EVR6-PBN4]

[54] See supra note 19 and accompanying text. See also Bartlett v. Strickland, 556 U.S. 1, 13 (2009) (citing Voinovich v. Quilter, 507 U.S. 146, 154 (1993) (“In majority-minority districts, a minority group composes a numerical, working majority of the voting-age population. Under present doctrine, § 2 can require the creation of these districts.”) ).

[55] See supra notes 42–49 and accompanying text.

[56] Wesley Lowery, 91% of the Time the Better-Financed Candidate Wins. Don’t Act Surprised, Wash. Post: The Fix (Apr. 4, 2014), https://www.washingtonpost.com/news/the-fix/wp/2014/04/04/think-money-doesnt-matter-in-elections-this-chart-says-youre-wrong/ [https://perma.cc/6NWX-AUB7].

[57] OpenSecrets, Money Wins Presidency and 9 of 10 Congressional Races in Priciest U.S. Election Ever (Nov. 5, 2008), http://www.opensecrets.org/news/2008/11/money-wins-white-house-and/ [https://perma.cc/5XFV-AL8G].

[58] See, e.g., Nate Silver, Hispanic-Majority Districts: Boon or Burden for Democrats?, FiveThirtyEight (Dec. 23, 2010, 11:26 PM), http://fivethirtyeight.com/features/hispanic-majority-districts-boon-or-burden-for-democrats/ [https://perma.cc/YWY9-BKXN] (“In general . . . majority-black districts create an inefficient distribution of Democratic votes and cost them seats in Congress.”).

[59] Theodore Schleifer, Houston Most Hispanic Part of Country Without Hispanic in Congress, Hous. Chron. (Sept. 6, 2014), http://www.houstonchronicle.com/news/politics/texas/article/Houston-most-Hispanic-part-of-country-without-5738987.php [https://perma.cc/XX9B-ZGMY].

[60] Id.

[61] Dwight Morris, The NRA: Political Behemoth or Overblown Player?, Wash. Post (July 6, 1998), http://www.washingtonpost.com/wp-srv/politics/campaigns/money/archive/money070698.htm [https://perma.cc/T2H8-KPKF] (“Without the NRA’s support, [Green] might very well have lost.”).

[62] Interview by José Angel Gutiérrez with John Castillo, former Houston Councilman, in Houston, Tex. (June 26, 1996), http://library.uta.edu/tejanovoices/xml/CMAS_050.xml [https://perma.cc/8H7M-XW9K].

[63] Bob Edwards, Transcript: Factors Contributing to Earl Hilliard’s Loss in Alabama’s Democratic Primary, NPR Morning Edition (July 2, 2002), http://www.npr.org/programs/morning/transcripts/2002/jul/020702.lohr.html [https://perma.cc/G6CK-UAN6].

[64] Kristi Keck, Davis Loss in Alabama a Sign of Black Establishment’s Clout, CNN (June 2, 2010, 12:42 PM), http://www.cnn.com/2010/POLITICS/06/02/alabama.gubernatorial.primary.davis/ [https://perma.cc/2UWE-VD3R].

[65] Juliet Eilperin, Davis Ousts Rep. Hilliard in Alabama Runoff, Wash. Post (June 26, 2002), https://www.washingtonpost.com/archive/politics/2002/06/26/davis-ousts-rep-hilliard-in-alabama-runoff/8829d148-a9b3-4f07-80ce-3c112576c784/?utm_term=.f49930ecb72f [https://perma.cc/WLA6-VDHH].

[66] Michael Wilson, In Alabama Politics, How New Kid Won the Bloc, N.Y. Times (July 3, 2002), http://www.nytimes.com/2002/07/03/us/in-alabama-politics-how-new-kid-won-the-bloc.html [https://perma.cc/8EJH-SYEX].

[67] Id.

[68] Id.

[69] Eilperin, supra note 65.

[70] Cynthia Gordy, Artur Davis: Why I Left the Democratic Party, The Root (June 6, 2012), http://www.theroot.com/articles/politics/2012/06/artur_davis_republican_partys_new_member_explains_his_switch [https://perma.cc/L39P-6XLL].

[71] Jonathan P. Hicks, A Congressional Seat in Play, and a Son Eager to Claim It, N.Y. Times (July 10, 2006), http://www.nytimes.com/2006/07/10/nyregion/10brooklyn.html [https://perma.cc/E5NU-87S7].

[72] Michael Cooper, Councilwoman Wins Primary for House Seat, N.Y. Times (Sept. 13, 2006), http://www.nytimes.com/2006/09/13/nyregion/13cong.html [https://perma.cc/3KPG-3LKG].

[73] Id.

[74] See Hicks, supra note 71.

[75] 377 U.S. 533, 565 (1964).

[76] See infra Part V.C.

[77] Spencer Overton, But Some Are More Equal: Race, Exclusion, and Campaign Finance, 80 Tex. L. Rev. 987, 1037 (2002).

[78] Thornburg v. Gingles, 478 U.S. 30, 47 (1986).

[79] Many thanks to Ron Fein and John Bonifaz at Free Speech For People, whose work and time speaking with me about a potential Section 2 challenge to our current money in politics regulatory landscape was extremely helpful as I began exploring this project.

[80] See Ellen Katz et al., Documenting Discrimination in Voting: Judicial Findings Under Section 2 of the Voting Rights Act Since 1982, 39 U. Mich. J.L. Reform 1, 34 (Dec. 2005), https://www.law.berkeley.edu/files/kats_discrimination_in_voting.pdf [https://perma.cc/67MN-YZ6J].

[81] Id.

[82] Id. at 33–34.

[83] See supra notes 37–39 and accompanying text.

[84] Overton v. City of Austin, 871 F.2d 529, 534 (5th Cir. 1989).

[85] Mo. State Conference of the Nat’l Ass’n for the Advancement of Colored People v. Ferguson-Florissant Sch. Dist., 201 F. Supp. 3d 1006, 1076–78 (E.D. Mo. 2016).

[86] See id. at 1076.

[87] Id.

[88] Paul Steinhauser & Robert Yoon, Cost to Win Congressional Election Skyrockets, CNN (July 11, 2013), http://www.cnn.com/2013/07/11/politics/congress-election-costs/ [https://perma.cc/J8EF-QTU8].

[89] See supra Part III. A; Jamin Raskin & John Bonifaz, Equal Protection and the Wealth Primary, 11 Yale L. & Pol’y Rev. 273, 279 n.26 (1993) (noting overlap between white candidates and white interests, and that private financing benefits those candidates and interests over those preferred by nonwhite individuals).

[90] 636 F. Supp. 1113, 1123 (E.D. La. 1986) (“[A]lthough no formal recruiting process exists, there does exist a more informal slating process.”).

[91] See Perez v. Pasadena Indep. Sch. Dist., 958 F. Supp. 1196, 1223–24 (S.D. Tex. 1997).

[92] See, e.g., Buckley, 424 U.S. at 246 (Burger, C.J., concurring in part and dissenting in part) (noting significant overlap between campaign contributions and endorsements).

[93] McDaniels v. Mehfoud, 702 F. Supp. 588, 595 (E.D. Va. 1988) (“The median income for black families in the county is $19,824 versus $23,202 for white families . . . .These differences adversely affect the ability of black citizens to participate in and influence the political process in Henrico County. For example, while black candidate Thornton received slightly over $20,000 in contributions to his 1987 supervisory campaign, his white opponent, Waldrop, received slightly over $40,000 . . . participation in the political process is positively correlated with socioeconomic status.”).

[94] Rural W. Tenn. African Am. Affairs Council v. Sundquist, 29 F. Supp. 2d 448, 459 (W.D. Tenn. 1998), aff’d, 209 F.3d 835 (6th Cir. 2000) (“The economic and educational isolation of African-Americans . . . limits their ability to fund and mount political campaigns. In this sense therefore, blacks are not able to equally participate in the political process.”).

[95] Cofield v. City of LaGrange, 969 F. Supp. 749, 768 (N.D. Ga. 1997) (“The economic disparity between the races in LaGrange translates into a disparity in the ability to impact the local political process. For example, in the 1995 elections for City Council, none of the African-American candidates received more total monetary contributions than any of the white candidates. The African-American candidates received an average of $825.12 in contributions, and the white candidates received an average of $2,825.90 per candidate.”).

[96] Ferguson-Florissant, 201 F. Supp. 3d at 1072 (citing expert testimony stating that that “recruiting candidates [and] coordinating” is costly and plaintiff testimony showing that “[b]lack voters in [the school district] may have fewer resources to volunteer or donate to Board campaigns.”).

[97] Political Civil Voters Org. v. Terrell, 565 F. Supp. 338, 342 (N.D. Tex. 1983) (“The effects of those official, discriminatory acts clearly [linger] in the housing patterns. Those housing patterns, in turn, greatly impede the ability of blacks to enter the political system in Terrell.”).

[98] See generally, e.g., supra note 96.

[99] See infra notes 106–08 and accompanying text for more information on the burdens issue.

[100] No. 86–4057, 1989 WL 106485, at *8 (E.D. La. Sept. 19, 1989), rev’d on other grounds by 917 F.2d 187 (5th Cir. 1990), rev’d by 501 U.S. 380 (1991).

[101] Cousin v. McWherter, 904 F. Supp. 686, 710 (E.D. Tenn. 1995), vacated on other grounds by Cousin v. Sundquist, 145 F.3d 818 (6th Cir. 1998) (“Blacks in Hamilton County . . . remain a socioeconomically depressed minority with a limited ability to fund and mount political campaigns.”). The Sixth Circuit affirmed that court’s specific finding with respect to Senate Report factor five, even as it vacated the ruling. See 145 F.3d at 833.

[102] Williams v. Dallas, 734 F. Supp. 1317, 1403 (N.D. Tex. 1990) (“The . . . commission found significant disparities in the education, employment, housing, and political opportunities available to minorities in Dallas. Credible testimony established that these socioeconomic disparities adversely affect political participation by blacks and Hispanics, and that they are ‘a reflection of prior discrimination in the community.’ These disparities provide a distinct advantage to white at-large candidates in terms of financial and other support.”).

[103] Neal v. Coleburn, 689 F. Supp. 1426, 1429 (E.D. Va. 1988).

[104] Id. at 1430. The court also noted that white control of political processes—including the fact that most polling places were in white neighborhoods staffed by white polling officials—was a relevant factor in determining a factor five violation. See id.

[105] United States v. Charleston Cty., 316 F. Supp. 2d 268, 291 (D.S.C. 2003).

[106] See Kirksey v. Bd. of Supervisors, 554 F.2d 139, 144–46 (5th Cir. 1977).

[107] Gretna, 636 F. Supp. at 1134 (internal citations omitted).

[108] See United States v. Blaine Cty., 363 F.3d 897, 914 (9th Cir. 2004).

[109] 52 USC § 10301(b) (2014) (“[N]othing in this section establishes a right to have members of a protected class elected in numbers equal to their proportion in the population.”).

[110] See, e.g., Earl Old Person v. Brown, 312 F.3d 1036, 1048 (9th Cir. 2002) (“[W]e do not read section 2 of the Voting Rights Act to require any precise mathematical calculation of percentages of success in election.”); Terrazas v. Clements, 581 F. Supp. 1329, 1356 (N.D. Tex. 1984) (“A lack of proportional representation has no independent constitutional or statutory significance.”).

[111] I might argue that the problem of incumbency exacerbates the problem of nonwhite representation and allows critics to attribute disproportionately high white representation simply to the power of incumbency without considering race. Yet, Professor James Snyder reports that initial evidence shows that most of the incoming money since Citizens United has gone to challengers, which has somewhat decreased the incumbency advantage. James Snyder, Professor, Harvard Univ., Lecture at Election Law Class Eight at the Harvard Law School (Nov. 7, 2016). In this way, defenders of the current campaign finance system could potentially use this initial data to argue that restricting money would disproportionately burden nonwhite voters.

[112] Arbor Hill Concerned Citizens Neighborhood Ass’n. v. Cty. of Alb., No. 03-CV-502, 2003 WL 21524820, at *13 (N.D.N.Y. July 7, 2003); Mehfoud, 702 F. Supp. 588, 590 (E.D. Va. 1988).

[113] Buchanan v. Jackson, 683 F. Supp. 1515, 1535 (W.D. Tenn. 1988).

[114] See, e.g., Mississippi State Chapter, Operation Push v. Allain, 674 F. Supp. 1245, 1265 (N.D. Miss. 1987) (noting that black people made up about 35 percent of the population but less than ten percent of elected officials); Major v. Treen, 574 F. Supp. 325, 341 (E.D. La. 1983) (noting that black people made up more than 29 percent of the population but just seven percent of Louisiana’s elected officials).

[115] See, e.g., Blaine Cty., 363 F.3d at 914 (stating that Americans Indians declined to run for office because they felt they could not win in an at-large election); Clark v. Calhoun Cty., 88 F.3d 1393, 1398 (1994); LaGrange, 969 F. Supp. at 776. Ironically enough, the Fifth Circuit has said that a nonwhite candidate’s inability to raise money is a potential proxy to argue that the candidate was not credible or serious enough to merit a factor seven finding—without considering that a candidate might be unable to raise money precisely on account of his race. See Rollins v. Fort Bend Indep. Sch. Dist., 89 F.3d 1205, 1215 (5th Cir. 1996).

[116] Cal. Elec. Code §§ 14027–28 (2002).

[117] Brief for Free Speech for People et al., as Amici Curiae Supporting Appellants, Lair v. Motl, (9th Cir. Oct. 5, 2016) (No. 16-35424).

[118] See Id. at *19–20

[119] The participation of low-income and minority voters giving small-dollar campaign donations was significantly higher in the 2009 New York City Council Elections than in the 2010 State Assembly elections. Sundeep Iyer et al., Brennan Ctr. & Campaign Fin. Inst., Donor Diversity Through Public Matching Funds 14 (2012), http://www.brennancenter.org/sites/default/files/legacy/publications/DonorDiversityReport_WEB.PDF [https://perma.cc/Z43T-8YLF]. New York City had a small-dollar matching public financing system, whereas New York State did not. See id. at 6.

[120] See supra note 52 and accompanying text.

[121] Small-dollar donations from minority neighborhoods were more significant financially to New York City Council candidates—where there was a public financing system—than were donations from those neighborhoods to State Assembly candidates. See Iyer, supra note 119.

[122] See supra note 53 and accompanying text.

[123] See, e.g., Edelman v. Jordan, 415 U.S. 651, 677 (1974).

[124] 403 U.S. 365 (1971).

[125] Milliken v. Bradley, 433 U.S. 267, 291 (1977).