Each year, federal administrative agencies issue between 3,000 and 5,000 final rules. In addition, they issue thousands of guidance documents—termed “Regulatory Dark Matter” by my Competitive Enterprise Institute colleague Wayne Crews—without the procedural protections of the Administrative Procedure Act’s public notice and comment requirements. These rules and regulations affect every facet of our lives. Yet, until recently, most courts, content to defer to agencies’ supposed expertise, have been reluctant to question agencies’ authority to issue these directives. They apply Chevron deference—derived from a 1984 Supreme Court decision—which instructs that, when a statute is ambiguous, judges should defer to agencies’ reasonable interpretations of their authority.
Last week’s Supreme Court decision in West Virginia v. EPA signals an end to judicial deference to broad agency actions. It reaffirms that the constitutional authority to issue the rules and regulations that govern our day-to-day lives derives from the peoples’ representatives in Congress and not from bureaucrats’ expertise. It also provides important insight into the motives of those who defend the power and prerogatives of administrative agencies.
The 6–3 majority held that when the Environmental Protection Agency issued carbon emission caps designed to “substantially restructure the American energy market” in an Obama-era Clean Power Plan, the agency had exceeded the authority granted to it by Congress in the Clean Air Act. This was the latest in “a series of significant cases all addressing a particular and recurring problem: agencies asserting highly consequential power beyond what Congress could reasonably be understood to have granted.”
The EPA claimed that a rarely used Clean Air Act section authorizing the agency to determine “the best system of emission reduction” to minimize pollution from “each individual regulated source” allowed it to compel a system-wide “generation shifting” from higher-emitting electricity producers (coal-fired plants) to lower-emitting ones such as gas-fired plants or renewable sources like solar and wind. The EPA’s own modeling predicted that the plan would raise energy costs and prices, close dozens of coal-fired plants, and result in tens of thousands of job losses.
The Court held that this case fell under the “major questions doctrine” that requires an agency to point to “clear congressional authorization” when it seeks to exercise powers of vast economic and political significance. In this case, as in two recent major-questions cases—one in which the CDC tried to shoehorn authority for a nationwide eviction moratorium into the Public Health Service Act and another in which OSHA claimed authority from a statute regulating occupational hazards to mandate Covid vaccinations for more than 80 million private workers—the Court could not find clear congressional authorization for broad agency action in the relevant statute.
Justice Elena Kagan’s dissent reveals a deep distrust of Congress’s abilities and intelligence. “Members of Congress often don’t know enough . . . to regulate sensibly on an issue” and “can’t know enough . . . to keep regulatory schemes working across time.” Hence, she concludes, “Congress therefore gives an expert agency the power to address issues—even significant ones—as and when they arise.”
Such reasoning begs the constitutional question: Did Congress authorize the EPA to remake the entire power-generating industry, or did it authorize it to regulate only individual emitting sources? Congress may be less well-informed than an agency, but our constitutional system gives policymaking authority and responsibility to the people’s elected representatives, no matter how expert administrative agencies may be.
As Justice Neil Gorsuch’s concurring opinion points out, “lawmaking under our Constitution can be difficult”—but that is a virtue, not a bug, of our system. It is a purposeful design to protect individual liberties from authoritarian power. By forcing the need for “broad consensus” and “compromise” to pass legislation, the Constitution “protect[s] minorities by ensuring that their votes would often decide the fate of proposed legislation—allowing them to wield real power alongside the majority.”
For progressive-era founders of the administrative state like Woodrow Wilson, agencies were needed not just because experts have specialized knowledge or because lawmaking is sclerotic but also because the masses are stupid. Citing several of Wilson’s own writings, Gorsuch’s first footnote highlights Wilson’s deep distrust of the people:
For example, Woodrow Wilson famously argued that “popular sovereignty” “embarrasse[d]” the Nation because it made it harder to achieve “executive expertness.” . . . In Wilson’s eyes, the mass of the people were “selfish, ignorant, timid, stubborn, or foolish.” . . . He expressed even greater disdain for particular groups, defending “[t]he white men of the South” for “rid[ding] themselves, by fair means or foul, of the intolerable burden of governments sustained by the votes of ignorant [African-Americans].” . . . He likewise denounced immigrants “from the south of Italy and men of the meaner sort out of Hungary and Poland,” who possessed “neither skill nor energy nor any initiative of quick intelligence.” . . . To Wilson, our Republic “tr[ied] to do too much by vote.”
Justice Kagan begins her dissent by claiming, “Today, the Court strips the Environmental Protection Agency (EPA) of the power Congress gave it to respond to ‘the most pressing environmental challenge of our time.’ Massachusetts v. EPA, 549 U. S. 497, 505 (2007).” She follows with a page-long, second paragraph, citing source after source to document that “[c]limate change’s causes and dangers are no longer subject to serious doubt.” Such an emergency, she asserts, demands a rapid administrative response that Congress is incapable of.
In fact, Congress demonstrated that it can act expeditiously in an emergency when it passed several measures worth trillions of dollars in the opening weeks of the Covid-19 pandemic. As Justice Robert’s majority opinion notes, “Capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible ‘solution to the crisis of the day,’” but it is a policy that must be made by “Congress itself, or an agency acting pursuant to a clear delegation from that representative body.” Despite the purportedly overwhelming and well-known evidence supporting the EPA plan cited by Justice Kagan, Justice Roberts observed that “Congress . . . has consistently rejected proposals to amend the Clean Air Act to create such a program.”
It’s ironic that the Massachusetts case Justice Kagan cites was an instance in which the Court overruled the EPA’s position that the Clean Air Act did not give it authority to regulate carbon dioxide and reversed the agency’s scientific judgment. The EPA found that a causal link between greenhouse gases and increased global temperatures had not been unequivocally established and that regulating new car emissions would do little to mitigate global warming. And Congress had rejected proposed amendments to force the EPA to set carbon dioxide emission standards for motor vehicles in its 1990 Clean Air Act amendments.
Nevertheless, instead of deferring to agency expertise, as Kagan now urges, the Supreme Court in Massachusetts held not only that the EPA had broad discretion to regulate carbon dioxide emissions but also that it should do so. The Court substituted its own expansive statutory and scientific interpretation for the agency’s strict interpretation of the statute. As Justice Antonin Scalia noted in his dissent, “Evidently, the Court defers only to those reasonable interpretations that it favors.” He continued: “No matter how important the underlying policy issues at stake, this Court has no business substituting its own desired outcome for the reasoned judgment of the responsible agency.”
The ruling in West Virginia v. EPA—along with the Court’s holdings in the pandemic eviction-moratorium and vaccine-mandate cases—indicates that in major-questions cases in which agencies claim broad powers, the Court will no longer defer to agency interpretations of implicit delegations of authority. Agencies will have to demonstrate explicit and unambiguous congressional authorization for their actions. This represents a welcome return of policymaking power to the body in which the Constitution places it: Congress.
Read the full article here.