Broken Buying: Adversarial Legalism and (In)Efficiency in Procurement Law

abstract. The United States has a government-capacity crisis: it struggles to get things done with speed and at low cost. Government’s incapacity has prompted a public reassessment of the country’s core institutions and processes. Most relevant legal scholarship discusses problems at the federal level, but this Note is part of a growing trend that shifts the spotlight onto state and local governments. Procurement laws—and more specifically, competitive-bidding laws—that determine how and to whom government contracts are awarded are central to the state- and local-capacity crisis. By tracing the history of the country’s competitive-bidding laws, this Note reveals how the broad vision of administrative discretion embodied in the laws at the country’s Founding has drifted into the narrow vision that prevails today. This Note argues that two forces are primarily responsible for the drift: adversarial legalism (i.e., complex, formal rules enforceable via litigation meant to check government discretion) and cost-based efficiency (i.e., requirements that government justify its actions in quantifiable, cost-cutting terms). In order to reinvigorate government capacity, both forces must be rolled back through statutory reforms enhancing administrative discretion. In a political moment defined by public frustration about government dysfunction, this Note offers a novel approach to unstick the government’s gears.

author. J.D. expected 2026, Yale Law School; M.P.A. 2021, University of Georgia; B.A. 2021, University of Georgia. I owe tremendous gratitude to Zachary Liscow for guidance and encouragement throughout the project. I am grateful for my classmates in Law of Infrastructure: Why Is Building in the U.S. So Expensive and Slow? (Fall 2024) and its many speakers—including Stephanie Pollack, whose distillation of the core challenges in government contracting first set this project in motion. Thanks to Robert Wescott for introducing me to the broader problems of government inefficiency, and to Eric Goldwyn, Davis Potts, David Schleicher, Steven L. Schooner, Christopher R. Yukins, and the Economic and Tax Policy (Spring 2025) class for immensely valuable feedback. Finally, a special thanks for the untold hours of review and brilliant insights from Caitlyn Jordan, Jessica Lin, Nellie Conover-Crockett, Matt Beattie-Callahan, Ako Ndefo-Haven, Jeremy Thomas, and the entire editorial team of the Yale Law Journal. All errors are my own.

Introduction

Ranking atop the world’s most traffic-congested cities,1 San Francisco has experienced years of growth in demand on its transportation infrastructure without a corresponding increase in capacity.2 The 1.7-mile Central Subway project, first proposed in 1993, was supposed to provide some relief.3 Instead, the city stumbled through years of delays and racked up hundreds of millions of dollars in cost overruns.4 From the outset, the city government could not avoid a highly specialized and high-cost construction process. Located entirely inside the city center of San Francisco, the subway was designed to link the surface-level Third Street Line with the SoMa, Downtown, and Chinatown business districts.5 Three of the four new stations would be 40 to 120 feet below grade, meaning that a network of tunnels had to be built beneath the city.6 The preliminary design and environmental permitting requirements, too, would be onerous.7 But the project fell further behind schedule even after final permits were secured in 2008.8 By the time contractors completed the Central Subway project in 2022, the project had exceeded initial budget projections by an eye-popping $375 million and dragged on more than three years longer than expected.9

Despite the Central Subway’s many setbacks, political leaders hailed the project a success. House Representative Nancy Pelosi celebrated the new subway track as “a crucial artery in San Francisco, connecting families to a booming corridor in the heart of the city” and “a strong step forward for justice, making it easier for parents to get to work, children to get to school and small businesses to attract more customers.”10 Then-San Francisco Mayor London Breed called it “a transformative project . . . and a critical bridge to connect our neighborhoods and bring people together.”11 But the reality of the subway’s construction tells a more complicated story.

Delays and cost overruns were not just a matter of mismanagement or bad luck. A study commissioned by the State of California found that they could be traced to a systemic issue: San Francisco’s statutory obligation to select the lowest-priced bidder, commonly known as low-bid, or lowest-bidder, procurement.12 The low-bid selection method is one way government can conduct public procurement, which is its process for acquiring the goods and services it needs to keep society running. Subways are one form of public procurement, but government procures so much more—schoolhouse desks, computers, medical equipment, buildings, submarines, and vaccine research. Although thought to ensure fairness and cost savings,13 the low-bid method of procurement sometimes produces the opposite effect. Recent research suggests the method can contribute to delays, hidden costs, bid-rigging, and poor results in infrastructure projects nationwide.14

The Central Subway project is no isolated government-procurement catastrophe. Similar problems plague government attempts to spend money all over the country, caused in part by similar legal obligations to select the cheapest bidder.15These problems contribute to what academics and political commentators refer to as the “crisis of state capacity.”16 The crisis affects nearly all government operations—from building subways to providing clean water and public housing.17 The solution has often been to throw money at the problem. For instance, the Biden Administration allocated more than $1.8 trillion in new infrastructure spending.18 But the greater expenditure was accompanied by marginal changes in how that money was spent, and it failed to alter the widespread perception that government cannot get things done. The perception of government incapacity may have, at least in part, fueled the “red” wave in the 2024 U.S. presidential election.19 In one telling, an electorate frustrated by government inefficiency was looking for a candidate with a solution.20 And Donald Trump, with his newfangled Department of Government Efficiency, promised to “conduct[] a complete financial and performance audit of the entire federal government” to eliminate “fraud and improper payments” that arguably created the inefficiencies.21 But despite the political rhetoric, what is needed to correct government efficiency may be something different altogether: a reform of how the nation’s public-procurement laws are drafted, interpreted, and applied, particularly at the state and local level.

Most contributors studying the government-capacity crisis—and to be sure, politicians themselves—focus on problems at the federal level.22 Upon taking office, the Trump Administration launched a federal-employee firing spree that purported to eliminate government bloat.23 Soon after, it announced plans to overhaul the federal government’s public-procurement guidebooks—the Federal Acquisition Regulation (FAR) and other agency supplements—to “create the most agile, effective, and efficient procurement system possible.”24 The Administration’s stated plan for FAR reform is to slim down the more than “2,000 pages of regulations” by eliminating provisions not required by statute.25 It is fair to question whether trimming down the FAR will solve the biggest problems with public procurement today. But even if such trimming could, the FAR assists only federal agencies in achieving procurement objectives. Problems at the state and local level would be left untouched.26

The irony of a federal-government-centric approach is that arguably the most significant government inefficiency problems exist at the state and local level. In fact, the federal government itself directly allocates only part of discretionary federal funds and issues substantial grants to states and local governments.27 Most procurement spending ($1.3 trillion of the nation’s total $2 trillion) is assigned by state and local governments.28 For the most part, state and local law determine how that money goes out the door. David Schleicher and other scholars have long called for greater attention to state and local governments for their significant, often underappreciated roles in government capacity.29 Despite their significance, state and local law has been sidelined in conversations about public procurement.30

Another problem is that there is little consensus about how or why U.S. public-procurement law contributes to government incapacity. Scholarship is divided on the question of how much discretion to leave procurement officers. Some scholars champion discretion-curtailing laws as foundational to the democratic procurement process, but others contend that discretion-enhancing laws are necessary for successful procurement outcomes.31 Economic research indicates that stricter laws in high-income countries like the United States may worsen procurement outcomes.32 But that research has not translated into specific proposals for reform to procurement law. As Ezra Klein and Derek Thompson put it in their recent hit book, Abundance, “What is . . . missing . . . is a clearly articulated vision of the future and how it differs from the present.”33 This Note takes on that task.

I argue the government-capacity crisis, at least in procurement law, is the result of two forces: adversarial legalism and cost-based notions of efficiency. Adversarial legalism, a term proposed by Robert A. Kagan, refers to the distinctively American system of party- and lawyer-dominated legal contestation.34 Complex formal rules operate within the system to channel action.35 Litigation, or its mere threat, exerts an additional and constant influence that further concerts behavior. This structure pressures administrators to comply with strict interpretations of laws, even when doing so produces suboptimal results or may not be demanded by the laws themselves. For example, administrators may feel pressure to award procurement contracts to the cheapest bidder even when laws permit awards to a higher-priced best-value bidder. The second factor, a commitment to a cost-based version of efficiency, affects how judges and lawyers read legal rules and administrators make decisions.36 Courts may sometimes demand administrators justify their actions in terms of cost savings, regardless of whether the laws they are executing were written to emphasize cost considerations. This application may frustrate the purpose of the underlying statutes, such as when an emphasis on cost cutting fosters corruption, impedes quality, or, ironically, leads to higher costs in the long run. Emphasis on cost removes nuanced decisions from the hands of those who have the greatest comparative competence to make them (e.g., procurement officers). The system also has a baked-in bias for readily quantifiable cost savings while neglecting benefits that are harder to quantify and that therefore may be more difficult to defend in court.

Government capacity cannot exist without well-defined guardrails on adversarial legalism and cost-based efficiency. Both factors result from limited statutory reservations for administrative discretion. Strict textualist modes of interpretations combined with widespread fears that government discretion will invite corruption and inefficiency, compound the restrictiveness of the statutes. Specific statutory reforms, especially at the state and local level, must clarify that measured administrative discretion is an intentional feature—not a bug—of good governance. One place to start is replacing the lowest-bidder language in competitive-bidding statutes, which often operates as one of the strictest checks on procurement officials’ decision-making. Doing so will unlock the opportunity for the government’s enormous procurement capacity to exert a greater active influence on public life.

This Note begins with an overview of how procurement law operates in practice. Part I introduces the core debate that has shaped the field: how much discretion the law should reserve for procurement administrators in the solicitation and award of public contracts. The Part then weighs in on this debate, arguing that administrative discretion has become too narrow and should be broadened in scope. I detail the problems limited discretion creates to reveal why state and local government procurement law needs urgent reform.

Part II traces the historical roots of public-procurement law. The Part starts with the nation’s first competitive-bidding laws, which set foundational standards for transparency and accountability in public procurement. It recounts how these laws originated during the American Revolution and traces their diffusion throughout state and local governments in the decades that followed. Rather than emphasizing bid amount alone, government administrators and courts understood the laws to require decision-making in the public interest.

Part III identifies how government-procurement law has evolved into its current form. It traces key cases in New York state courts that signify a nationwide evolution in procurement law. The evolved interpretation and application of public-procurement law, I argue, is part of a more general process of legal drift—the gradual change in how laws are interpreted and applied over time. The Part proposes that public procurement today is characterized by an entrenchment in adversarial legalism and a misguided commitment to efficiency—which often turns out to be inefficiency in practice.

Part IV recommends how policymakers and judges might expand government capacity through the law. The Part proposes (1) reinterpreting public-procurement laws in accordance with their original intent; (2) broadening statutory authorization for the exercise of government discretion; (3) narrowing the availability of judicial review of government procurement decisions; and (4) tailoring judicial remedies to foster the procurement process, not stall it. Each of these proposals can be accomplished across every level of government. But state and local governments, as the primary disbursers of procurement funds, must drive this change. The most important starting point is the American Bar Association’s (ABA) Model Procurement Code,37 which is currently undergoing the most sweeping revision since its adoption in 1979.

Many American public-procurement projects, especially for major public works, come at a high cost, take a long time to complete, and perform poorly in the long run.38 A different approach is needed to make government work again. This pivot requires returning to the original conception of the competitive procurement system—one that empowers all levels of government, but especially state and local governments, to act in the public interest.