Fresh off a blockbuster US Supreme Court decision that rolled back the power of federal agencies to regulate business, big-government foes are pressing an even bolder agenda.
As the court prepares to start its new term next month, conservatives are laying the groundwork to further gut governmental authority. More issues are steaming toward the court, offering new paths for undercutting the administrative state, no matter who wins the presidential election.
Four weeks after the court overturned a 40-year-old legal precedent that had been a regulatory bedrock, liberal Justice Elena Kagan said the conservative majority sees rulemaking as needing to be “reined in.” Kagan dissented three times at the end of the court’s last term in cases that put new constraints on regulators.
“The court has made clear that it just thinks there’s too much agency regulation going on,” Kagan told a judicial conference in California in July.
By some lights, the coming issues could be even more consequential. One set of cases threatens a multitude of laws that let agencies set clean air standards, establish workplace-safety rules and determine what constitutes an unfair trade practice. A second targets the independence of the Securities and Exchange Commission and possibly even the Federal Reserve.
The court’s new term formally opens on Oct. 7, though the justices probably will get a head start a few days in advance by granting review in a number of new cases. Here’s what is on the horizon in the court’s ongoing campaign against the regulators:
Nondelegation Doctrine
For years, conservatives have been trying to revive the nondelegation doctrine, a legal theory the Supreme Court last invoked in 1935 in two rulings that blunted Franklin D. Roosevelt’s New Deal. The core of the argument is that the Constitution assigned the legislative power to Congress and lawmakers can’t simply hand off that authority.
The debate raises a more fundamental issue than Loper Bright v. Raimondo, the June 28 ruling that overturned the so-called Chevron doctrine and said judges should no longer defer to agencies on the meaning of ambiguous laws. While Loper Bright concerned how much power agencies have under statutes enacted by Congress, the nondelegation doctrine questions whether lawmakers had authority to pass many of those measures in the first place.
Loper Bright was “a fight on the margins of the real question,” said John Yoo, a University of California, Berkeley, law professor who clerked for conservative Justice Clarence Thomas. “The question at the heart of it is how far can Congress go in transferring the power to make laws from itself to the executive branch, to the bureaucracy.”
The court has watered down the nondelegation doctrine in recent decades, saying Congress can delegate its powers as long as it lays out an “intelligible principle” for agencies to follow. Scores of statutes have been enacted in reliance on that notion — empowering agencies to set “reasonable rates” or take “necessary or appropriate” actions — and could suddenly become legally vulnerable if the court requires Congress to be more explicit.
“Virtually every agency operates under statutes that are broad delegations of power,” said Erwin Chemerinsky, dean of the law school at the University of California, Berkeley.
The court’s conservatives have said several times in recent years they are interested in taking up the issue. They’ll have a chance to get started with a pending appeal challenging the $8 billion in charges the Federal Communications Commission imposes on monthly phone bills to subsidize service for poor people and those in rural areas. The court could say as early as next month whether it will hear that case in the coming term.
Agency Independence
On the same day the court issued one of its nondelegation rulings in 1935, the justices gave a green light to the independent agencies that now proliferate across the US government. The unanimous ruling, known as Humphrey’s Executor v. United States, said Roosevelt lacked the power to fire a Federal Trade Commission member, upholding a law that gave the five commissioners broad job protections.
That precedent is now in jeopardy – and along with it the independence of such agencies as the SEC, FTC and FCC, whose members are presidentially appointed but currently not subject to White House control.
The court in 2020 ruled that the president could fire the director of the Consumer Financial Protection Bureau for any reason, striking down a similar shield Congress had created for that position. The court said the Constitution’s separation of powers precluded an arrangement that left such a powerful executive branch figure unaccountable to the president.
The 2020 ruling didn’t address the legality of multimember independent agencies, and it stopped short of overruling Humphrey’s Executor. But the conservative majority said enough to cast both in doubt.
“Overruling Humphrey’s Executor is very much on the table, and I think it’s probably going to happen in the next five to 10 years,” said Leah Litman, a professor who teaches constitutional law at the University of Michigan Law School. “I think there are five votes to do it now.”
Project 2025, the Heritage Foundation blueprint for a second Donald Trump term assembled by his allies and administration alumni, said the 1935 ruling “seems ripe for revisiting — and perhaps sooner than later.”
The sticking point may be the Fed, whose independence has long been a central feature of US economic policy. Trump has already raised questions about the Fed’s autonomy, saying last month that the president should have some say over interest rates and monetary policy.
“The Federal Reserve is the agency that the court might have the most concern with subjecting entirely to presidential control,” said Jeffrey Wall, a lawyer at Sullivan & Cromwell who served as acting solicitor general under Trump. “Some of the justices may see the Fed as different from pretty much all the other agencies.”
As with the nondelegation doctrine, the court will have an early chance to take up the issue of independent agencies. The court is scheduled to say in the coming weeks whether it will hear a challenge to the autonomy of the Consumer Product Safety Commission.
The case “asks whether federal agencies may wield the president’s power without bearing the president’s supervision,” according to an appeal pressed by two research organizations represented by former Trump White House Counsel Don McGahn. “It is hard to imagine many questions more important than the one presented here.”
Photo: The Justices of the US Supreme Court. Photographer: Eric Lee/Bloomberg
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