Reining in the administrative state

As we enter the final quarter of this year, Americans are settling into school schedules, soccer classes, and following fall sports (in our house the Kansas City Chiefs). For those of us in the legal profession, the first Monday in October signals not only changing leaves and cool evenings, but the arrival of the Supreme Court term.

Ordinarily, the Supreme Court’s docket—the cases the Supreme Court has agreed to review—contains a blockbuster or two. A few years back, the Supreme Court decided New York State Rifle and Pistol Association v. Bruen which held that the right to carry a weapon outside the home for purposes of self-defense is deeply rooted in history and that a government cannot require someone to demonstrate a “special need” to exercise that right. Two years ago, the Supreme Court decided Dobbs v. Jackson Women’s Health Organization, which finally recognized the authority of We the People to protect unborn live. And just last year, the Supreme Court decided 303 Creative LLC v. Elenis, upholding free speech for us all and prohibiting the government from compelling people to speak contrary to their most deeply held beliefs.

So far, the Supreme Court has granted only 22 cases, though more grants are anticipated in the coming days. The court’s 2024 docket doesn’t yet contain a so-called blockbuster, though cases can always surprise you. What it does contain, however, is a series of cases that confirm that the Supreme Court is concerned about enforcing the Constitutionally defined separation of powers.

Our republican form of government depends in large part on these principles. The Framers intentionally separated the powers of the federal government into the legislative, executive, and judicial branches. This separation was central to protecting individual liberty because it required all three branches to act in concert before the government could curtail individual liberty.

Needless to say, the Framers did not countenance anything quite like the modern administrative state. Administrative agencies today wield vast power. They enact regulations with the force and effect of law (and many more of them than Congress does statutes). They enforce the regulations they have authored. And they adjudicate disputes involving those regulations within the administrative agency, too. James Madison would be aghast. He famously noted “The accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, self-appointed, or elective, may justly be pronounced the very definition of tyranny.”

Madison would be pleased with the Supreme Court’s upcoming docket. Several cases may place limits on the powers of administrative agencies.

First, Loper Bright Enterprises v. Raimondo could spell the end of what is known as “Chevron deference.” Loper Bright involves small fishing companies challenging an agency rule that requires fishermen to foot the bill for their own “monitors.” But Congress never said that the agency could charge fisherman for its services. Instead, the agency relies on the Chevron doctrine, which says that federal courts must defer to an agency’s interpretation of a statute. But the fishing companies contend (and there is a good case to be made) that Chevon deference steals the power of Congress to make laws and the courts to interpret them.

The Supreme Court will also review two other cases that may similarly limit the power of unelected agencies and administrative power. In Consumer Financial Protection Bureau v. Community Financial Services Association of America, Ltd., the court will hear arguments regarding a government agency that not only receives funding separate of Congressional appropriation (as required by the Constitution) but also determines its own budget and directly taps the Federal Reserve (subject to a congressional funding cap) to receive that funding. That arrangement would surely have the Founders rolling over in their graves.

In Securities and Exchange Commission v. Jarkesy, the Supreme Court will determine whether the powers given to the SEC are unconstitutional. The SEC often acts as both prosecutor—charging individuals for violations of rules it has written—as well as judge. Jarkesy who was tried and convicted by the SEC on a fraud-type of charge argues that the SEC proceeding violated the Seventh Amendment. That amendment guarantees “the right of trial by jury” in most civil cases. Indeed, Thomas Jefferson identified the jury “as the only anchor, ever yet imagined by man, by which a government can be held to the principles of its constitution.” The lower court agreed with the finding that the type of claim was commonplace at common law and that Jarkesy was entitled to a jury of his peers.

In short, the U.S. Supreme Court’s 2024 term gives the nine justices an opportunity to continue to roll back administrative and legal abuses and allow Americans to flourish under the system of separated powers intended by our Founding Fathers.