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What Amtrak Has in Common With Government

Noah Feldman is a Bloomberg View columnist. He is a professor of constitutional and international law at Harvard University and was a clerk to U.S. Supreme Court Justice David Souter. His books include “Cool War: The Future of Global Competition” and “Divided by God: America’s Church-State Problem -- and What We Should Do About It.”
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Ever sit on Amtrak's Acela high-speed service wondering why our train system is so medievally slow compared with, say, China’s? Or rather: Have you ever sat on the Acela and not thought that? Either way, the U.S. Supreme Court has a case for you. Today it's considering the constitutionality of a law that, at least in theory, allows Amtrak to pressure the companies that own the rail lines and freight trains to improve access for passenger trains. And the constitutional issue is a fascinating one that goes back to the New Deal: How much lawmaking authority can Congress delegate to bodies other than itself?

To understand the legal background, first you have to know that Amtrak doesn't own the tracks; 97 percent of those belong to old-fashioned railroad companies. In 1970, with the railroads dying as the inevitable result of President Dwight Eisenhower's interstate highway plan, Congress passed a law that offered the railroads a deal that was, as the U.S. Court of Appeals for the D.C. Circuit said, “an offer they could not refuse.” Godfather Uncle Sam said the railroads would be freed of the legal obligation they had previously borne of providing intercity rail service, but they would be required to give the trains of the newly formed Amtrak priority over all freight trains on the rails.

This arrangement put Amtrak into business with the owners of the rail lines -- which creates the possibility of conflict between them. In 2008, Congress passed the law at issue in the current case, the Passenger Rail Investment and Improvement Act. It first authorized Amtrak, in collaboration with the Federal Rail Administration, to develop metrics and standards for measuring service quality. If the standards aren’t followed, a supervisory government entity called the Surface Transportation Board can punish the rail carriers for failing to follow the rules, including giving priority to Amtrak trains.

Sounds fantastic, right? Under this legal regime, Amtrak has a central say in enacting binding regulations that will help its trains run on time, or even faster.

Enter the D.C. Circuit, or rather a panel of that appeals court consisting of Judge Janice Rogers Brown, the court’s most extreme conservative, and Reagan appointees David Sentelle and Stephen Williams. In a surprising opinion, the court held the passenger rail law unconstitutional under a somewhat obscure doctrine that says Congress cannot delegate its power to a private entity. Thus, the court held, Congress could not constitutionally allow Amtrak to participate jointly with the Federal Rail Administration in making the regulations that would then be enforced against the railroads.

As a constitutional matter, Congress may delegate legislative authority to administrative agencies provided that it gives those agencies guidance in the form of “an intelligible principle.” The intelligible principle can be pretty vague -- in essence, Congress can tell the Environmental Protection Agency to keep the air clean, and leave it to the EPA to fill in the blanks. What Congress can’t do is delegate legislative authority to a private entity.

The National Industrial Recovery Act, part of the first New Deal, a now almost forgotten legislative precursor to the more familiar second New Deal, was struck down by the Supreme Court in 1935 partly because of this same flaw. Under the influence of neocorporatist thinking not altogether dissimilar from efforts to help the Italian and German economies recover from the Great Depression, Congress had created collaborative entities that included representatives of labor, private companies and government to set prices and production levels. Justice Benjamin Cardozo, who was a moderate, called the law “delegation running riot.”

But is Amtrak a private entity? Well, no. It's a for-profit corporation (in theory -- it never actually makes a profit and loses billions) set up by federal statute and managed by a board that is appointed almost entirely by the president. In fact, the reason Amtrak loses money is that it's required by statute to deliver service to all sorts of unprofitable locations -- because it's a public service. In a 1995 case, Lebron v. National Passenger Railroad Corp., the Supreme Court decided that Amtrak was, in fact, the federal government for purposes of the First Amendment. The court reasoned that if it held otherwise, the federal government could simply avoid First Amendment protections by outsourcing its responsibilities to private corporations and then hiding behind them.

The archconservative Brown reasons the Lebron precedent away. Amtrak is the federal government for purposes of First Amendment protection, she said, because that subjects Amtrak to the Constitution. But “deeming Amtrak to be just another governmental entity,” she argued, “would allow the government to ignore a constitutional obligation” not to delegate legislative authority.

Brown’s argument begs its conclusion. If Amtrak is part of the government, then it resembles an administrative agency -- and there's no problem with delegating authority to it. It's hard to escape the suspicion that Brown secretly dislikes all government delegation to administrative agencies, and yearns for the world before the New Deal, when government couldn’t extend the tentacles of regulation that constitute the octopus of the modern administrative state.

The Supreme Court probably won't go this far -- and it shouldn't. Amtrak serves what is essentially a government role, and is controlled by presidential appointments much like administrative agencies are. Having Amtrak enact relations jointly with the Federal Rail Administration should help make the system of government work better. The result doesn't turn Barack Obama into Mussolini -- even if, by some miracle, the trains were to start running on time.

  1. To be fair, Williams is actually the most centrist judge on the D.C. Circuit as measured by empirical researchers. Why he didn't dissent here is to me a mystery, but I'm sure he has good reason -- he usually does.

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To contact the author on this story:
Noah Feldman at nfeldman7@bloomberg.net

To contact the editor on this story:
Stacey Shick at sshick@bloomberg.net