The Expert Wars
At what level of expertise does one rise above responsibility?
Trump’s War on the Administrative State Faces New Resistance
Here’s the rub.
No matter their expertise, we should not set aside democratic self-government and controls, preferring the benevolent dictatorship of experts that Kagan hails with her Wilsonian logic.
No way.
They’re going to have a tough time contorting themselves into arguing for protection of the Federal Reserve if they overturn Humphreys.
‘I also don’t accept the progressive premise, well argued by Justice Kagan, that there are “certain spheres of government” in which “knowledgeable people from both parties” can be trusted to make decisions “likely to advance the long-term public good,” and therefore that said “knowledgeable people” should be insulated from politics — i.e., from such measures as removal without cause by someone who is actually elected, the president. Is there a limiting principle that defines what “spheres of government” should be independent of separation of powers and ordinary democratic accountability? I don’t see one.’
The Supreme Court Wants to Crush Regulation—but Not the Fed
The Supreme Court suggests that the Fed is “quasi-private” (whatever that means) so the Court can feel free to overturn Humphrey’s and let the Administration fire people in policy positions at all executive agencies, even the ones that tell everyone they are “independent” agencies (whatever that means).
I’m thoroughly convinced that the Administration will end up with the ability to fire the Fed Chair. I’m also of the opinion that it won’t be as bad as the market will take it initially. It will be a tremendous shock.
‘But it was a given from the start that the Supreme Court would allow Trump to fire two Biden appointees—Gwynne Wilcox at the National Labor Relations Board and Cathy Harris at the Merit Systems Protection Board—whose terms weren’t due to expire until 2029. That’s because we’ve known for some time that there are five conservative justices ready to overturn Humphrey’s Executor v. United States (1935), a New Deal case that upheld statutory language making illegal any independent-agency firing without cause. The only surprise was that the conservative majority gave Wilcox and Harris the hook before it got around to overturning Humphrey’s Executor. It was acting, at the president’s request, against two district court judges and the District of Columbia Court of Appeals, which (following established law) reinstated Wilcox and Harris. The Supreme Court said its removal of Wilcox and Harris “reflects our judgment that the Government is likely to show that both the NLRB and MSPB exercise considerable executive power” that the Constitution vests in the president. Translation: Why wait? We know what we think before we hear any arguments.
‘The high court further said that “the Government faces greater risk of harm from an order allowing a removed officer to continue exercising the executive power than a wrongfully removed officer faces from being unable to perform her statutory duty.”’
The Labor Board Needs Restructuring, Not Destruction
Policy uncertainty is here to stay.
The article goes on to argue for the establishment of a labor court to replace the NLRB. It would have administrative law judges as its trial division and then it would hear appeals of the rulings its own judges made.
Surely, there is a simpler solution.
‘The National Labor Relations Board (NLRB) has been the subject of continuing criticism for its constant reversal of agency law with each change of administration. Indeed, Board “flip-flopping” on labor law in this country has gotten progressively worse. Labor, management, and all stakeholders affected by the National Labor Relations Act would benefit from more clarity and consistency in the interpretation and application of that statute. It is questionable, however, whether the present structure of the agency can meet these important objectives.’
The Supreme Court Gives Permission to Build Under NEPA
There need to be reasonable limits on regulators.
Who regulates the regulators? The court apparently.
‘All kinds of building projects get stuck in endless reviews and litigation under the 1970 National Environmental Policy Act. But NEPA is supposed to let federal regulators “weigh environmental consequences as the agency reasonably sees fit,” Justice Brett Kavanaugh writes for the Court in Seven County Infrastructure Coalition v. Eagle County. “NEPA is a procedural cross-check, not a substantive roadblock. The goal of the law is to inform agency decisionmaking, not to paralyze it.”
‘The railroad in this case is a classic example of the problem. The proposal is to link the oil-rich Uinta Basin to the rest of the country. The federal Surface Transportation Board approved the rail line in 2021, after a lengthy environmental review of the potential effects on air pollution, wetlands, wildlife, and more. Four years later, construction is still on hold.’
Goodbye to Racial Quotas in Federal Contracts
Set-asides, a term not used in polite company much, are now under attack.
‘In a motion in federal court in Kentucky, the Justice Department said the Transportation Department’s longstanding Disadvantaged Business Enterprise program (DBE) violates the Constitution’s Equal Protection Clause. This is the program that sets aside federal contracts for women and minorities. The DBE program doles out some $37 billion in contracts over five years.
‘The case was brought by the Wisconsin Institute for Law & Liberty (WILL), which sued the federal government in 2023 on behalf of Mid-America Milling and Bagshaw Trucking. The companies say they were denied contracts because they weren’t minority- or woman-owned. In September 2024 federal Judge Gregory Van Tatenhove issued an injunction and said the case was likely to succeed on the merits.’
‘Nuclear Verdicts’ Sink Small Businesses
Litigation is a supplementary type of regulation, but it is subject to abuse.
‘An alliance between personal injury lawyers and unscrupulous doctors has wreaked havoc on Texas small businesses by pinning them with massive lawsuits. The state Legislature is finally fighting back.
‘So-called nuclear verdicts of $10 million or more in cases involving one or a few plaintiffs reached a 15-year high in 2023. Some of these verdicts were for fender-benders, and many were inflated by questionable medical bills produced by doctors and lawyers. A 2018 fender-bender in Upshur County, Texas, ballooned to a $101 million verdict. The plaintiff’s personal injury lawyer had directed him to a chiropractor, pain specialist, and back surgeon who all happened to be frequent trial witnesses in the lawyer’s cases.’
Supreme Court Curbs Scope of Environmental Reviews
Unanimous ruling from the Supreme Court that there are limits to the amount of regulatory oversight.
The weaponization of regulation and dilatory litigation has gone too far.
‘Justice Brett M. Kavanaugh, writing for five justices, said that many lower courts had dictated that the environmental impact statements required by a 1970 federal law, the National Environmental Policy Act, be needlessly elaborate.
‘“The goal of the law,” he wrote, “is to inform agency decision making, not to paralyze it.”
‘The court’s three liberal members agreed with the decision’s bottom line but on narrower grounds. Justice Neil M. Gorsuch was recused.’
Courts Are Quietly Taking Over the Internet
Markets bring us tremendous new digital platforms.
Regulators see this and see opportunity.
‘Who do you think decides what you see and how you interact on your favorite online service? Most would point to Silicon Valley engineers and product managers tinkering behind the scenes. However, an underappreciated reality is emerging: judges and regulators are increasingly the ones who decide how online platforms operate. The blueprint for tomorrow's internet is being drawn up in courtrooms and government offices. This should concern us all.
‘Today's leading tech platforms were initially shaped by market forces. Governments did not tell Google to display blue links, Apple to invent the App Store, or Amazon to introduce the "Buy Box." But legal battles and regulations are now redefining how platforms are built and run. This includes deciding how firms can monetize their services, how they display content to users, and which features can be rolled into a single service.’