Paul L. Caron

Friday, September 13, 2019

Weekly SSRN Tax Article Review And Roundup: Speck Reviews Osofsky's Agency Legislative Fixes

This week, Sloan Speck (Colorado) reviews a new work by Leigh Osofsky (North Carolina), Agency Legislative Fixes, 105 Iowa L. Rev. __ (2020).

Speck (2017)In Agency Legislative Fixes, Leigh Osofsky develops a framework for understanding and analyzing agency actions to correct technical and drafting errors in legislation. Osofsky motivates this framework primary through various examples from the December 2017 tax legislation known as the Tax Cuts and Jobs Act. In addition, Osofsky alludes to a number of other high-profile legislative mistakes in the Affordable Care Act, the Dodd-Frank Act, and elsewhere. Osofsky adeptly interweaves her tax-oriented story with academic work on legislation and administrative law, yielding a rich critique of Treasury’s current practices in handling gaps between Congress’s presumptive or purported intent and prevailing interpretations of statutory text, as enacted. Osofsky concludes by addressing several possible reforms, including an interesting proposal to adjust the revenue baseline in budget reconciliation to account for erroneous scores attributable to congressional mistakes.

Osofsky acknowledges that legislative drafting mistakes, as a category, are intrinsically slippery: “in some ways,” she writes with understatement, “they are in the eye of the beholder.” Even narrow definitions rely on intensely subjective understandings of coherence and absurdity, expression and intent, and context and scope. One person’s typo can be another’s clearly stated public policy, and, while it’s undeniable that legislative errors exist in the abstract, the systematic identification of such errors sets the stakes for Osofsky’s proposed reforms. For example, legislative mistakes may be idiosyncratic, or normally distributed over a spectrum, or correlated with some external variable. Appropriate responses may need to account for this topography.

The definitional questions surrounding legislative mistakes implicate, I think, a broader relationship between errors, however identified, and the substance of statutory law. Taking a Justice Stewart perspective on the identification question, such errors may function as “tags” that correlate with the broader quality of a particular piece of congressional work product. Imagine a student term paper. Egregious lapses in spelling and usage may predispose the grader to treat the underlying argument more skeptically. In many cases, this treatment is fair: proofreading failures tend to show a lack of reflection on, and investment in, the substantive writing. From this perspective, the problem with (pervasive) legislative mistakes isn’t agency fixes; it’s that the law being fixed is more deeply problematic. The baby should be thrown out with the bathwater, and so we should forestall stopgap technical corrections instead of facilitating them.

In a similar vein, the potential connection between congressional drafting errors and the substance of legislation provides normative support for encouraging hold-up-style bargaining over technical corrections. Even if there is complete consensus over the existence of, and solution to, a particular legislative mistake (say, the “grain glitch”), lawmakers should condition any correction on additional substantive changes (per Sherrod Brown). (These changes might need to be limited to the legislation at issue, which arguably didn’t happen with the grain glitch.) The result could be more moderate, better-deliberated, and higher-quality statutory law. Again, however, this perspective cuts against making it easier for Congress or agencies to fix legislative mistakes.

Finally, Osofsky left me wondering whether she would support an end to the Senate filibuster as all or part of a solution to the problems she identifies. If political polarization persists, then perhaps we need to embrace lower thresholds for legislative action—and the concomitant policy churn those thresholds likely would produce. Congress will make mistakes, and agencies will struggle to deal with those errors. An increased velocity of legislation may, however, help to correct for other process deficiencies, and the outcome may not only be fewer errors, but better policy on balance.

Overall, Osofsky provides a compelling and comprehensive framing for an important but understudied problem. Osofsky’s rich and engaging article is critical reading for tax academics, as well as scholars of administrative law and the legislative process.

Here’s the rest of this week’s SSRN Tax Roundup:

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