Supreme Court’s Upcoming Review Could Redefine Presidential Authority Over Independent Agencies

Supreme Court’s Upcoming Review Could Redefine Presidential Authority Over Independent Agencies

The Supreme Court is preparing to reevaluate a pivotal decision regarding the president’s authority to terminate members of independent agencies. This high-stakes review may not only bolster executive power but also have significant implications for the administrative state.

The Case Resurfaces

In an order issued last week, the court announced its intention to revisit the 1935 ruling in Humphrey’s Executor v. United States. Legal expert Hans von Spakovsky from the Heritage Foundation argues that this ruling is hanging by a thread.

Unlike the precedent established in Humphrey’s, von Spakovsky believes that agencies, including the Federal Trade Commission and the Securities and Exchange Commission, should not be beyond the reach of presidential oversight.

He explained that the Constitution designates the president as the head of the executive branch. This designation implies that just as a corporate CEO manages the entire company, the president should supervise the executive branch without legislative restrictions. According to him, Congress should not have the authority to limit presidential command over these agencies.

Implications of Recent Court Rulings

The Supreme Court’s decision to engage with this challenge comes on the heels of a case where President Donald Trump dismissed a commissioner from the Federal Trade Commission shortly after taking office. Trump’s firing of Rebecca Slaughter, a Biden appointee, remains under examination.

In a 6-3 emergency decision, the court allowed Trump’s action to stand temporarily, enabling it to use Slaughter’s case to reassess the Humphrey’s Executor precedent. This earlier case involved a firing during Franklin D. Roosevelt’s administration, where the high court ruled that Roosevelt could not dismiss a commissioner without just cause.

Slaughter contends that her termination was unlawful and violates both the precedent set by Humphrey’s and the FTC Act, which stipulates that commissioners can only be removed for reasons such as misconduct or negligence during their seven-year terms.

Future of Independent Agencies at Stake

Legal scholar Joshua Blackman from South Texas College of Law suggests that an overturning or limitation of Humphrey’s could extend far beyond the FTC, potentially affecting other independent regulatory bodies that enjoy similar protections against being fired.

He noted that the pivotal question remains whether the Supreme Court will treat the Federal Reserve as a unique entity in terms of presidential control. The court recently hinted at a particular view of the Federal Reserve as a quasi-private structure, differentiating it from other independent agencies.

Scrutinizing Historical Context

Von Spakovsky remarked that the Supreme Court appears to be slowly moving toward confronting the relevance of Humphrey’s. Citing earlier rulings, such as the 2010 decision that diluted the Sarbanes-Oxley Act and a 2017 ruling affirming the president’s power to remove the director of the Consumer Financial Protection Bureau, he suggests long-term trends are emerging.

In the case concerning the CFPB, Chief Justice John Roberts articulated that the president’s authority to supervise those wielding executive power is rooted in Article II of the Constitution. He noted that the CFPB’s structure, which assigns significant executive power to a single director, effectively undermines presidential authority to manage executive agencies.

Unitary Executive Theory Under Review

Should the court rule favorably for Trump and his allies, it could facilitate their ambition of establishing a unitary executive. This theory posits that the president should have unchallenged control over the entire executive branch.

During Trump’s presidency, he utilized various strategies to dismiss protected appointees from independent agencies, an approach that the Supreme Court is now poised to evaluate.

Legal expert Jed Shugerman from Boston University criticized Trump’s actions, stating that they have contributed more significantly to the establishment of a unitary executive than any judicial or scholarly efforts could. However, he also criticized the president, asserting that Trump’s maneuvers are undermining the legal underpinnings of the unitary executive theory, illustrating a departure into authoritarianism.

Shifting Landscape of Regulatory Powers

Recent commentary from John Shu, a constitutional law expert with experience in both Bush administrations, indicates that the Supreme Court is likely to limit the precedential impact of Humphrey’s Executor. Shu believes that the powers exercised by the FTC have evolved substantially since its establishment, and today’s agency operates far differently.

Today’s FTC has the authority to initiate investigations, issue subpoenas, and impose financial penalties. It now holds executive, quasi-legislative, and quasi-judicial powers, marking a significant departure from its original mandate.

What Lies Ahead for the Administrative State

The Supreme Court’s willingness to revisit Humphrey’s Executor signals a possible shift in the balance of power between the presidency and independent agencies. As the court prepares to further scrutinize these foundational precedents, the ramifications could reshape the operational framework of the administrative state.

This pivotal moment in judicial review not only emphasizes the ongoing tug-of-war between branches of government but also highlights the broader discourse on presidential authority in contemporary governance.