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Subject Area: Political Theory

Origins of Planning - Leonard P. Liggio, Literature of Liberty, January/March 1978, vol. 1, No. 1 [1978]

Edition used:

Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.

Part of: Literature of Liberty: A Review of Contemporary Liberal Thought, 20 vols. 19781-982

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


Origins of Planning

McCraw, Thomas K.

  • University of Texas, Austin

“Regulation in America: A Review Article.” Business History Review (USA), 49 (1975): 159–183.

McCraw's survey studies economic regulation by state and federal commissions in the extensive literature of four disciplines—history, political science, law, and economics. The collection proposes a confusing number of alternative explanations for the regulatory behavior. These studies call into question cherished views of business-government relations and the true nature and actual results of Progressive and New Deal reforms, as well as the wisdom and efficacy of planned interference with market forces by the state regulators. The ill-defined notion of “public interest” so often invoked by regulators serves as no more than a slippery touchstone to guide their interventions.

The “public interest” model (which stressed the benign role and public-spirited motivation of the regulatory agencies) fails to adequately characterize all of American regulation. Similarly, the “capture” thesis (proposed by socialist Gabriel Kolko and various free market economists of the “Chicago school,” who claimed that the regulators were the agents of the “regulated”), is deemed inadequate.

Despite the vast literature on regulation, scholars still have only a vague idea of what went on inside the commissions. Their puzzlement arises from the complex interplay of contending interest groups, the relationships among commissioners and career staff members, and especially the connections between regulatory policy and perceived bureaucratic imperatives.

Commissions seldom followed paths that would diminish their own power or importance. Instead they pursued policies that would promote their institutional growth and survival. The inconsistent regulatory policies over the last 100 years suggest that the commissions' highest loyalties sometimes were neither to the “public interest” nor to the regulated industry (as the capture thesis would hold), but to regulation itself. Regulation was the regulators' job, and they did not intend to close up shop. Regulation promoted as an end in itself begot an independent social force which may have had substantial cumulative influence. But this area remains largely unexplored by scholars and may require concerted interdisciplinary research.