The Interstitial Bureaucracy

There is a peculiar geography to modern power, and it does not appear on any map. It occupies the interstitial spaces between the public and private sectors, a legal twilight zone where organizations can casually shift shapes depending on what suits them best. When they need funding or protection, they are public authorities. When they face oversight or public records laws, they are private enough to evade them.

Take, for instance, interstate compacts. Once approved by Congress, these multi-state agreements are elevated into federal law, granting them the muscular authority to preempt inconsistent state regulations. Yet despite their federal heft, these compact agencies routinely slip past standard administrative requirements that bind ordinary agencies, such as the National Environmental Policy Act.

This creates a strange sovereignty. The Supreme Court has long treated these compacts through the lens of contract law—binding agreements between states—while simultaneously ruling that their legal interpretation depends entirely on the intent of Congress, rather than the original intent of the states that drafted them. This precedent has drawn sharp academic criticism, and for good reason: it leaves the signatory states bound to an instrument whose meaning can drift far from what they actually agreed to.

Operating in this administrative netherworld, these quasi-governmental entities can easily sidestep standard budgetary controls. Public accountability becomes secondary to institutional self-preservation. When an organization answers to everyone and no one in equal measure, the machinery of government ceases to serve the public interest and instead serves itself.