When I was going to law school, there was this relatively new group dedicated to a legal counter-revolution.  One of their desires was to roll back the growth of the administrative state.  According to this group, the Supreme Court of the 1900-1935 period had it right, and that many aspects of administrative law were unconstitutional.  They sought to overturn most of the Supreme Court decisions regarding administrative law from the 1935-86 period.  That group was the Federalist Society, and the legal extremists who were outliers in 1990 are, while still extremists and outliers, now the majority of the U.S. Supreme Court.  The end of term saw three major decisions which show that these supporters of laissez faire capitalism which place investors over workers, consumers and the general public are very close to near total success.

To understand these decisions, a brief background on administrative law would be helpful.  The basic concept of the administrative state is that the real world is complex and that the legislative process is too cumbersome (and legislators are too lacking in technical expertise) to quickly adjust to changes.  To meet this need, Congress established administrative agencies which would have the expertise to evaluate changes and could quickly enact regulations to deal with those changes.  In the early days, the Supreme Court resisted this process under the “non-delegation doctrine” which held that Congress could not delegate the power to make law.  After the New Deal, the Supreme Court found that Congress could delegate the power to make rules as long as the statutes granting that regulatory power was sufficiently clear on the desired goals of the regulations and the standards that the agencies were to follow in those regulations.  In recent years, there has been an attempt to partially resurrect the non-delegation doctrine in the form of the “major questions doctrine” which seeks to limit the application of the existing laws to new issues even though the very reason for administrative agencies is to increase the flexibility to respond to new issues in a field.    Shortly after World War II, Congress adopted the Administrative Procedure Act — a complex set of laws which detail the process for adopting regulations (longer than the early advocates of administrative law would have liked), challenging those regulations, and imposing administrative penalties for violations of those regulations.  This year’s cases involved three aspects of that administrative process.

The most significant of these cases involve whether a regulation is authorized by statute.  Back in the 1980, when many judges were appointed by Democrats but Republicans were in the White House, a Republican-controlled Supreme Court decided in a case involving Chevron and environmental groups that courts should defer to the interpretation given by administrative agencies of ambiguous statutes in determining the validity of regulations.  There were always question about how ambiguous a statute needed to be for Chevron deference to apply and whether recently adopted views (of the political appointees over the agency) should be given the same deference as long-standing interpretations, but the basic concept was considered good law.  But to a group trying to neuter the administrative state, allowing agencies broad discretion to determine what regulations are allowed was something that could not be tolerated.  For most of the past decade or so, this crusade had to be satisfied with a Supreme Court that abused textualism to find that statutes were not sufficiently ambiguous and that the administrative agencies’ interpretations of their governing statutes were, therefore, not reasonable.  To be crystal clear, at a general level, this push back on Chevron deference is not completely insane.  An administrative agency should not be allowed to ignore the governing statute, and it is primarily the obligation of the judicial branch to determine the meaning of a statute.  But, in many cases, the rules for construing statutes suggest multiple alternative answers.  While one answer may be the “best” answer under the rules, it is not crystal clear that the “best” answer is the answer that Congress intended.  When there is no conclusive answer, should the agency have some flexibility or should a split Supreme Court (or appellate court) be able to insist on one answer. Continue Reading...