Originally published by The Regulatory Review (theregreview.org)
As I reflect on the Supreme Court’s administrative law opinions last term and read the commentaries of scholars about those opinions, I have a sense of nostalgia. The opinions of the justices who tried unsuccessfully to persuade a majority to uphold an agency action, along with the commentaries of many scholars who discuss those opinions, refer to the desirability of judicial deference to agency expertise.
I long for a return to the days when I could argue for deference to an expert agency with a straight face, but those days are gone in the context of any politically salient agency action. An example of this phenomenon lies in a six-justice majority decision in West Virginia v. EPA to overturn the Clean Power Plan (CPP), which the U.S. Environmental Protection Agency (EPA) issued during the Obama Administration. One of the arguments that Justice Elena Kagan made in her dissent is the same one that many scholars make about the majority opinion—the Court should have deferred to the agency because of the agency’s expertise.
The initial problem with Justice Kagan’s argument is the fact that the EPA that issued the CPP during the Obama Administration is the same EPA that issued the Affordable Clean Energy Plan (ACE) during the Trump Administration. A court cannot defer both to the expert EPA that issued the CPP and to the expert EPA that rejected the CPP and issued the ACE.
One potential way of solving that problem is to say that a court should not defer to EPA’s decision to issue the ACE because it was not the product of agency expertise. The White House and the president’s appointees at EPA dictated ACE. The expert staff at EPA just created an administrative record that described and explained the decision made by political appointees.
The problem with that answer is that it applies to most major decisions that agencies make today. Thus, for instance, Jerry Mashaw and David Berke conducted a comprehensive study of presidential direction of agency actions. Their findings led them to conclude that agencies’ announcements of the major climate change policy decisions and immigration policy decisions during the Obama Administration were actually made in the White House and dictated to the agencies.
There are good reasons for the president to make policy decisions, such as political accountability. Moreover, the White House sometimes has more expertise in a given area than agencies do. For instance, IRS has expertise about tax law and policy, but it has no expertise about health care, even though it was given a key role in the implementation of the 2010 Patient Protection and Affordable Care Act. In that context, the White House may have had more expertise on health care than the Office of the Commissioner of Internal Revenue.
It is also important to ask whether the agency that takes an action has sufficient relevant expertise. For example, the CPP would have required owners of generating units to operate some units but not other units. It would have required massive changes in the way that the severely capacity-constrained U.S. electricity grid functions. Although EPA has developed extensive expertise with respect to air quality and emissions, it has less expertise about the electricity grid, which the CPP had been expected to affect. EPA’s core competency does not lie with how the electricity grid functions or how the CPP could be implemented without having severe adverse effects on the reliability of electricity service.
The CPP also raises the recurring question of whether an agency action came from an expert agency or whether it came from the White House. For the CPP, the sequence of actions is relevant to that question. President Obama first tried to persuade Congress to enact a statute that would be effective in mitigating climate change. It was only after that effort failed that he told EPA to craft a rule that would mitigate climate change. The CPP reflected the expertise of EPA, but the impetus for the CPP was the White House. As Mashaw and Berke document, EPA proposed its audacious plan only after President Obama’s attempt to persuade Congress to enact a climate change statute had failed and when he was desperately searching for actions that might allow the United States to fulfill its commitments under the Paris Accord.
Given the power of the president to compel agencies to take action and the increasing tendency of presidents of both parties to use that power, I can no longer say “defer to the expertise of the agency” with a straight face when an agency takes an action with high political salience. I can only feel nostalgic about days in the distant past when I could and did use that phrase with confidence that it had some meaning.
The Supreme Court’s opinions last term had a lot of bad news for people who believe that regulatory agencies have provided enormous benefits to society. Future applications of a strong version of the major questions doctrine as seen in the West Virginia and NFIB opinions, coupled with legislative impotence, will make it difficult for the United States to respond effectively to any major new problem.
There was, however, some reassuring news in those opinions. The conservative justices placed a lot of emphasis on the importance of maintaining consistency in the ways that agencies interpret statutes. That suggests that the Court is unlikely to create obstacles to the kinds of actions that regulatory agencies have long taken to protect the public. Those are also the kinds of actions that are likely to be the product of agency expertise. By contrast, the actions that will be candidates for application of the major questions doctrine are more likely to be those that have resulted from politically motivated White House pressure.