Presidential Management of the Bureaucracy: The Reform of Motor Carrier Regulation at the ICC

Abstract

Deregulation of the motor freight industry poses a serious challenge to social scientists' understanding of how regulatory systems operate. In this research, it is argued that the dismantling of the regulatory regime at the Interstate Commerce Commission was a product of presidential management of the bureaucracy through guidance of the status quo. Reform was a function of neither group influence nor a transition from one structure-induced equilibrium to another. None of the variety of alternative explanations fare any better. It was the chief executive's ability to capitalize on presidential resources through strategic utilization of political rules and processes that was fundamental. In a world characterized by imperfect information and bounded rationality, presidents have opportunities for manipulating the status quo and circumventing the policy preference of regulatees and legislators. Motor carrier reform is simply an extreme example of a general phenomenon. Besides simply highlighting the need to incorporate additional actors into political economy models of bureaucratic behavior, this research shows that careful attention must be paid to detailing how these rules and processes affect bureaucratic performance.