The Administrative State Is Put Back in Its Constitutional Place
The extent to which Loper and Jarkesy impact the administrative state is a function of how much off track they have become. The agencies can still do the job if they act within the statutes. People, on either side of the aisle, pulling their hair out in jubilation or despair are either over-estimating the significance of the judgments or they know precisely how the agencies have pushed the envelope of acceptable conduct.
If the administrative state is inline with statutory guidance, there should be little daylight between the decisions they would make and what independent courts would conclude.
How bad could it be?
‘The Supreme Court has struck a series of powerful blows against this system. In SEC v. Jarkesy, it ruled that the Seventh Amendment right to a jury trial in civil cases cannot be evaded in cases brought by a government agency simply by the expedient of assigning them to an administrative law judge employed by the same agency. In Loper Bright Enterprises v. Raimondo, it struck down the Chevron doctrine, which allowed agencies not only to interpret ambiguities in their own statutes but to demand that courts defer to those interpretations.
‘Ending Chevron has been a long-term project of constitutionalists. The doctrine, minted only in the mid 1980s, never sat comfortably with the traditional power of the judiciary to, in the words of Chief Justice John Marshall, “say what the law is.” Nor was it consistent with the Administrative Procedure Act, passed in 1946, which provided that a court reviewing agency action must “decide all relevant questions of law” and “interpret” the relevant “statutory provisions.”
‘Neither of these decisions prevented the agencies from exercising powers explicitly granted by Congress, or from pursuing cases that could stand up in court. So the alarms about crippling administrative power are overstated. Nor were these decisions, as the Court’s liberals would have it, a judicial “power grab.” Jarkesy requires judges to share power with juries, and Loper Bright restores the proper primacy of Congress. And the Court has taken this course while ruling, in Erlinger v. United States, that criminal sentencing judges must also yield to juries the power to find facts that increase a sentence.’
Supreme Court Ruling Reins In Federal Bureaucrats
If your view is that agency behavior has become divorced from statutory intent, then you’re jumping for joy. Count the NAHB in that camp. They believe that the agencies will have less discretion to impose new regulations that Congress did not clearly authorize.”
‘“Today’s Supreme Court ruling is an important step forward to advance meaningful regulatory reform because it means that federal agencies can no longer continuously change the law — and the intent of Congress — by implementing their own interpretation of statutes as long as those interpretations are viewed as being ‘reasonable,’” said NAHB Chairman Carl Harris.’
Supreme Court Overturns Chevron Deference, Restricts Bureaucratic Overreach
Supreme Court shifts power over federal regulations from agencies to judges
This piece from Politico seems upset that unelected judges (“based on their own policy preferences”) will have the ability to determine what regulations are permissible as opposed to unelected bureaucrats (acting “based on their own policy preferences”).
‘But the court’s liberal wing warned that the majority’s latest decision will allow unelected judges to strike down rules based on their own policy preferences. Until now, a court had to let the agencies’ interpretations stand as long as they fell within the realm of reasonability, even if the judge didn’t think it was the best reading.’
Supreme Court just made it harder for federal agencies to regulate in sweeping ruling
This is only half true. Loper made it more difficult for agencies to regulate without being accountable.
‘In a momentous decision that will affect vast swaths of American life, the U.S. Supreme Court on Friday undid decades of regulatory law, making it far more difficult for federal agencies to issue rules and regulations that carry out broad mandates enacted by Congress. The vote, along ideological lines, was 6-to-3.’
The Supreme Court overturns Chevron doctrine, gutting federal environmental protections
The principal objection here is from the experts. They see this as a transfer of power away from the experts to the judiciary. Conservatives would say it transfers responsibility back to Congress. The judiciary are just the umpires.
‘“Today’s ruling sidelines the role of agency expertise, and instead shifts power to judges who do not have the expertise of agency staff who live and breathe the science, financial principles, and safety concerns that federal agencies specialize in,” Kym Meyer, the litigation director for the Southern Environmental Law Center, said in a statement. ‘
Supreme Court Eliminates Longstanding Legal Principle Concerning Federal Regulation
Earthjustice characterizes Loper as the judiciary seizing power from Congress.
‘The Loper Bright decision, which was issued by the Court’s conservative supermajority, will dramatically change the way in which judges review regulations issued by federal agencies. By telling judges to take over the lead role in interpreting ambiguous statutory language, and not to listen first to the agencies Congress charged with implementing that language, the decision will shift power away from the elected branches of government and into the hands of unelected judges.
‘“The Supreme Court is pushing the nation into uncharted waters as it seizes power from our elected branches of government to advance its deregulatory agenda,” said Earthjustice Senior Vice President for Programs Sambhav Sankar. “The conservative justices are aggressively reshaping the foundations of our government so that the President and Congress have less power to protect the public, and corporations have more power to challenge regulations in search of profits. This ruling threatens the legitimacy of hundreds of regulations that keep us safe, protect our homes and environment, and create a level playing field for businesses to compete on.’
What The Supreme Court’s New Curbs On Regulatory Power Could Mean For Tax Law
Good question.
‘One key question that Loper Bright may not have resolved: How much discretion will Treasury and IRS have when Congress expressly asks them to fill in those statutory blanks? The majority left the door open by saying, “That is not to say that Congress cannot or does not confirm discretionary authority on agencies. Congress may do so, subject to Constitutional limits.”’
It remains to be seen how much Loper will cause federal agencies to second-guess their discretionary rule-making in the absence of statutory clarity. It puts a tremendous amount of pressure on Congress to write more and clearer legislation instead.
‘Congress has passed vague laws for decades, saying that bureaucratic agencies can regulate within that framework of certain laws, and then those regulations will become law.’
Graves: SCOTUS Ruling Reiterates that Congress – Not Bureaucrats – Should Write Laws’
More chest-thumping about the significance of Loper’s future impact. Time will tell.
‘“The Supreme Court decision today could go down as one of the most impactful in modern history,” said Congressman Graves. “This helps to restore the role of Congress and the balance of powers. The court is exactly right in that laws should only be written by Congress – not through the unilateral actions of Republican and Democrat presidents and bureaucrats. Now, the onus is on Congress to move away from dysfunction and toward doing what is best for the American people, rather than focusing on the politics. We will see if our politicians are up to the task.’
Comer Applauds Supreme Court’s Decision to Rein in Federal Bureaucracy’s Regulatory Overreach
The presumption here is that Congress won’t write a ton of legislation that sets out clear, specific rules. That may not always be the case.
‘“Today’s Supreme Court decision stops the unelected, unaccountable federal bureaucracy’s aggressive regulatory overreach. This is a win for the American people, small businesses, and our Constitutional Republic. For far too long, the administrative state has been able to wield unchecked power and act as legislators by issuing major regulations that have driven up costs for Americans, stifled innovation, and micromanaged nearly every aspect of Americans’ lives. This decision rightfully hands the power back to Americans’ elected representatives in Congress to write our nation’s laws and to the courts to interpret them.”’
McHenry Statement on SCOTUS Decisions Limiting Bureaucratic Overreach
This is part of the criticism of the administrative state. Congress passes a law that pertains to activity X. The relevant agency then does whatever they want, even changing their rules over time, citing the cover of an unclear law that never intended the rules the administrators promulgate, knowing that their own in-house courts and the Chevron rule would let them ride roughshod over the primacy of the people. How much will the courts change?
‘“Today’s Supreme Court decision is a critical rebuke of the administrative state’s outsized influence over the lawmaking process,” said Chairman McHenry. “For too long, unelected bureaucrats have abused their power to circumvent Congressional intent. The decisions handed down by the Court this week, from the overturning of Chevron to SEC v. Jarkesy, offer a welcome check to this Administration’s overzealous regulators and their weaponization of the federal bureaucracy. Committee Republicans will continue to hold President Biden’s financial regulators accountable and reject their efforts to inject partisan political objectives when implementing laws that govern our financial system.”’
AI gets it right where journalists wave their arms. We’re not going to know for years what the full practical impact of Loper is.
‘Overall, this represents a major shift in the balance of power between the executive and judicial branches when it comes to administrative law and regulation. The full practical implications will likely take years to play out through new litigation and regulatory processes.”’
Supreme Court blocks EPA's interstate air pollution regulation
You can’t just force people in one state to suffer because you want to regulate people in another state.
‘In the majority opinion, Justice Neil Gorsuch wrote that the EPA's decision to implement the rule even though it was partially blocked was part of the problem, as the agency did not address how effective the regulation would be if it were only partly in effect.
The government failed to show "whether the cost-effectiveness analysis it performed collectively for 23 states would yield the same results and command the same emission-control measures if conduct for, say, just one state," Gorsuch wrote.’
The Supreme Court strips the SEC of a critical enforcement tool in fraud cases
Sotomayor is right. It’s up to Congress to do it’s job. The frustration is that it’s much easier to level a massive civil penalty in a court housed in the same agency that is doing the prosecuting than it will be in a federal trial by jury. The sense of resignation here is that Congress won’t or can’t write clear statutes in a period of tremendous polarization.
‘“For those and countless other agencies, all the majority can say is tough luck; get a new statute from Congress,” she wrote.’
US SUPREME COURT CURTAILS AVAILABILITY OF SEC IN-HOUSE PROCEEDINGS
This makes sense: federal court for litigation and administrative court for settlements.
‘The Court’s decision is likely to make permanent the SEC’s more recent practice of bringing such litigated cases in federal court, rather than in its “in-house” administrative proceedings. The decision is unlikely, however, to impact the SEC’s and parties’ ability to voluntarily settle a matter as an administrative proceeding after an enforcement investigation, even if that settlement involves a penalty.’
U.S. Supreme Court Limits Use of SEC Administrative Courts in Antifraud Actions
Should we even have administrative enforcement? Will we?
‘The Jarkesy decision jeopardizes the SEC’s use of its own in-house courts in numerous cases. The Court’s opinion focused on actions alleging violations of antifraud provisions, but there are now serious questions about whether the ruling will sweep more broadly — both at the SEC and at other federal agencies with administrative enforcement powers.’
Company closing Kitchener factory, blames cost of development and government overregulation
Bureaucracy, bureaucracy. Toujours bureaucracy.
‘“Public sector inefficiency in the permitting and entitlement process reduces the inventory of land available for housing development and renders land costs too expensive for the development of affordable housing,” it read. “A developer must either choose to pay too much for developable land or wait too long to go through permitting and entitlement. Financing for modular construction in Canada also proved to be an inefficient and costly process."’