Mehrotra, Ajay K.

English

Indiana University Bloomington Maurer School of Law

Maurer School of Law: Indiana UniversityDigital Repository @ Maurer LawArticles by Maurer Faculty Faculty Scholarship2011Book Review. Louis D. Brandeis and the Making ofRegulated Competition, 1900-1932 by GeraldBerkAjay K. MehrotraIndiana University Maurer School of LawFollow this and additional works at: http://www.repository.law.indiana.edu/facpubPart of the Antitrust and Trade Regulation Commons, Judges Commons, and the Legal HistoryCommonsThis Book Review is brought to you for free and open access by the FacultyScholarship at Digital Repository @ Maurer Law. It has been accepted forinclusion in Articles by Maurer Faculty by an authorized administrator ofDigital Repository @ Maurer Law. For more information, please contactwattn@indiana.edu.Recommended CitationMehrotra, Ajay K., "Book Review. Louis D. Brandeis and the Making of Regulated Competition, 1900-1932 by Gerald Berk" (2011).Articles by Maurer Faculty. 2533.http://www.repository.law.indiana.edu/facpub/25331074 Book Reviewsplished "while continuing to imagine something different" (167).To conform to the feminist ethic, responsible actions must be"grounded in community": they must be informed by exchangesbetween lawyers and clients that create "understanding of [eachother's] situations, abilities, and limitations" and reflect "respectfor each other's decisions" (169). Finally, a feminist ethic of riskinvolves "strategic risk taking" that "challeng[es] authority when itis possible to do so and with full knowledge of the risks involvedand awareness of who will bear the burden of failure" (170). AsShdaimah observes, personal relationships are central to this ethic.She argues that scholarship removed to the realm of abstractionmisses out on both the empirical realities and the transformativepossibilities of progressive lawyers' practice.There are other things to like about this book as well. It will beof interest to scholars of the professions, as it nicely illuminateschallenges faced by all kinds of professionals who provide directservices to personal clients-for example, doctors, therapists, socialworkers, teachers, and dentists, as well as some types of lawyers.Among these are tensions between professional expertise and clientautonomy, tensions surrounding the boundaries of client-professional relationships and personal intimacy and empathy, andtensions between what professional ethics and knowledge may pre-scribe and what clients' and professionals' capacities may permit. Tosociolegal scholars, it will be of interest as a new piece in thegrowing mosaic of contemporary studies of how legal institutionswork in practice. To analysts of poverty, the book provides a valu-able portrait of how civil law fits in to the maintenance and,occasionally, the amelioration of inequality. The methodologicalappendix is a good example of how to do such writing well.Louis D. Brandeis and the Making of Regulated Competition,1900-1932. By Gerald Berk. Cambridge and New York:Cambridge University Press, 2009. 296 pp. $85.00 cloth.Reviewed by Ajay K. Mehrotra, Indiana UniversitySociolegal scholars and historians of the American regulatory statehave long been interested in exploring how democratic institutionsin the early twentieth century challenged and accommodated therise of corporate capitalism. Those scholars who have focused onU.S. antitrust law have tended to characterize the historical policyBook Reviews 1075response to corporate consolidation as a binary choice betweenprogressive attempts to use public administration to harness andregulate monopoly power and populist desires to diminish the sizeof large corporations and restore market competition. In his newbook, Gerald Berk collapses this conventional dichotomy by per-suasively showing that historical actors, led by the jurist and socialreformer Louis Brandeis, envisioned and paved a third waybetween the populists and progressives. Berk refers to this alterna-tive path as "regulated competition," which he cogently describes asa fusion of progressive faith in scientific expertise and populistaffinities for market discipline.In Berk's account, Brandeis is rightfully featured as the intel-lectual fountainhead of a "republican experimentalism" that gavebirth to regulated competition. By deploying modern scientificmeans to achieve republican ends, Brandeis sought to use statepower to prod big businesses to think creatively about how theycould align their interests with those of consumers and regulators.As a reformer and lawyer, Brandeis worked closely with engineersand cost accountants at the Interstate Commerce Commission,where he learned firsthand about the importance of disaggregatingbusiness costs and encouraging information sharing among com-petitors. Unlike orthodox economists and laissez-faire constitution-alists, who presumed that particular business costs were natural andfixed, and that courts could easily police the line between accept-able competition and impermissible monopoly power, Brandeisand his acolytes contended that industrial production was as mucha social as a technological process, and that predatory economicorganizations like cartels could be transformed into cooperativetrade associations, thus obscuring the line between competition andmonopoly.Brandeis was able to convince powerful lawmakers designingthe Federal Trade Commission (FTC), as well as key officials withinthe nascent agency, to take seriously the idea of regulating bigbusinesses by cultivating industry habits of collaborative reflection,inquiry, experimentation, and evaluation. Consequently, FTC offi-cials were empowered to work with business leaders to channeleconomic activity away from unproductive, cutthroat competitionand toward creative and constructive cooperation. To achieve theseends, the agency hosted trade practice conferences, gatheredand disseminated information about different ways to measurecosts, developed benchmarking standards and best practices, andrevealed alternative methods of conceptualizing industrial produc-tion. Officials did all this, Berk argues, not by increasing the FTC'stop-down bureaucratic power over industry, but by blurring thelines of authority within the agency, flattening hierarchical author-ity, and encouraging lateral communication among departments.1076 Book ReviewsThese early achievements seemed doomed when the federalcourts, the U.S. Department ofJustice, and a branch of the Ameri-can economics profession began in the 1920s to challenge elementsof the FTC's regulated competition. But, as Berk masterfully dem-onstrates, the judicial setbacks did not simply destroy regulatedcompetition. In chapter 5, which will be of great interest to readersof this journal, Berk lucidly shows how these institutional con-straints paradoxically provided creative reformers with new oppor-tunities, for while the courts limited the FTC's ex ante coerciveauthority, they provided space for the agency to experiment withnew and innovative forms of public-private "associationalism"through trade practice conferences and other means of informationsharing. Ultimately, regulated competition was contained ratherthan defeated, as certain aspects of it survived in particular indus-tries well into the late twentieth century.Like Berk's previous book (1994), this study provides awelcome corrective to the existing historical institutionalist litera-ture on regulatory law and American capitalism. Whereas manyscholars have tended to see technological and economic conditionsas rigid constraints on institutional development and policy choices,Berk maintains that technology and economic activity can bereinterpreted in numerous ways, and that as a result organizationalchange and policy options can potentially be more flexible andopen. Relying on what he refers to as a theory of "creative syncre-tism," Berk contends that institutions contain multiple componentsthat can be unpacked and repackaged in unpredictable ways,providing imaginative reformers with opportunities to reframelong-standing problems in new ways and to search out, throughdemocratic deliberation, innovative policy solutions. Thus, Bran-deis and proponents of regulated competition were unwilling totake for granted the economists' theoretical conclusion that high,fixed business costs always and everywhere dictate the need forhigh volume production. Instead, they revealed how volume-basedaccounting shrouded salient differences in the production process.By doing so, creative syncretists like Brandeis paved a possible pathfor regulated competition.In addition to challenging standard historical institutionalistaccounts, the book complements a growing interdisciplinary, socio-legal historiography that continues to debunk the myth of the weakAmerican state. Berk convincingly demonstrates that one reasonwhy scholars have mistakenly depicted the American regulatorystate, and the FTC in particular, as anemic is that they have beenpreoccupied with measuring state power in classical, Weberianterms. If one examines less conspicuous but equally effective meansof governance, such as the collaborative statecraft at the heart ofregulated competition, one can see that flattened and disbursedBook Reviews 1077public power was-and can still potentially be-an effective meansof regulation.Experts in the field might quibble with how Berk uses certainhistorical constructs as foils for his narrative. His reliance on anoutdated and at times monolithic notion of populism and progres-sivism, for instance, or his implicit characterization of the early-twentieth-century American economics profession as a homogenousand rigid group of thinkers, can correctly be questioned. Still,despite these minor criticisms, Berk's book ought to garner theattention of law and society scholars interested in organizationaltheory and institutional development. It is without doubt aninvaluable contribution to the history of American law and politicaleconomy.ReferenceBerk, Gerald (1994) Alternative Tracks: The Constitution of American Industrial Order, 1865-1916. Baltimore, MD: Johns Hopkins Univ. Press.Statelessness in the European Union: Displaced, Undocumented,Unwanted. By Caroline Sawyer & Brad K. Blitz, eds. New York:Cambridge University Press, 2011. 366 pp. $105.00 cloth.Reviewed by Anna Dolidze, Cornell UniversityThe most recent influx of migrants from North African countries toEurope resuscitated the European Union debate on immigrationpolicy. Statelessness in the European Union is a welcome and timelyaddition to the debate. Moreover, the book is a valuable contribu-tion to the more general ongoing discussion on the changingnature of state sovereignty and its effect on noncitizens and thevalue of citizenship. The book will be of particular interest toindividuals studying issues raised by migration, particularly inEurope, as well as those who study the rights of noncitizens.The book could be divided into three main parts. The intro-duction by Caroline Sawyer and Brad K. Blitz carefully delineatesthe analytical framework of the book, explains the methodology,and places it in the relevant scholarship. The second part, whichincludes more theoretical and general discussion on the issue ofstatelessness, includes contributions by Monika Krause, Matthew J.Gibney, Caroline Sawyer, and Brad K. Blitz.

Book Review. Louis D. Brandeis and the Making of Regulated Competition, 1900-1932 by Gerald Berk

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Book Review. Louis D. Brandeis and the Making of Regulated Competition, 1900-1932 by Gerald Berk

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Indiana University Bloomington Maurer School of Law