Walter Olson
The February 18 executive order moving to assert White House supremacy over federal regulation is momentous, but not for the reason mistakenly surmised in some early reports. In declaring a general presidential authority to pronounce on legal interpretation, in particular, the order does not aim to aggress against the role of the courts in saying what the law is. Rather, the order seeks to conquer and subdue what separate interpretive authority has resided in independent agencies, such as the Securities and Exchange Commission (SEC) and National Labor Relations Board (NLRB).
The gist of the order, as regards legal interpretation, is thus that such agencies are no longer free to speak for the Executive Branch on what the law is in their area; only the White House or Department of Justice can henceforth do that in an authoritative way.
In addition—and probably bigger news for many constituencies—the order says the (formerly) independent agencies must run proposed regulations by the Office of Management and Budget’s (OMB’s) Office of Information and Regulatory Affairs (OIRA), as ordinary agencies do. Also, it orders them to submit many aspects of agency management, including policy and many spending decisions, to White House supervision.
If the Trump administration can make all this stick, it’s momentous. For example, the president could impose interpretations of broadcast law that Federal Communications Commission executives think are wrong but that serve his political objectives. While it’s presented as a fait accompli, the claim is going to be subject to judicial review.
As I read it, it will stick only if the court agrees to embrace a robust version of the so-called unitary executive theory (UET), holding in effect that the creation of the independent agencies was a constitutional mistake and that they should be folded into the Executive Branch. If they embrace such a theory, then this is one logical consequence. For example, submitting independent agency regulations to OIRA review has long been discussed as a likely implication of the unitary executive theory and has also found favor for policy reasons among some who do not go along with the full UET idea.
The new order also specifies that White House oversight will apply to the Federal Reserve Board’s role in conventional bank regulation and supervision but not to the conduct of monetary policy by the Fed’s Board of Governors or Federal Open Market Committee, which the White House surely hopes will remove one panic point for markets.
One bit of perspective: many (most?) of the big, important regulators are already outright Executive Branch creatures rather than independent agencies and always have been. Thus the Environmental Protection Agency, Food and Drug Administration, Occupational Safety and Health Administration, Internal Revenue Service, Federal Aviation Administration, and many others. OMB’s OIRA thus already wields formidable power even without adding in the Federal Trade Commission, FCC, Equal Employment Opportunity Commission, SEC, NLRB, and so on.
On a less reassuring note, to the extent that this or any future administration embarks on a policy of regulatory retaliation against businesses or other entities it perceives as enemies, controlling the full portfolio of regulatory agencies will enable retaliation to be fuller, more comprehensive, and sometimes more focused than if it controlled only a large share of them.
To get back to the unitary executive theory, you’ll notice that the Supreme Court has *not* handed down a decision embracing it as law. Should it do so, it’ll rank among the cases of the century. But it hasn’t! Many read the tea leaves as mixed; the court might embrace the theory in some respects but not all.
And this is a pattern. The Trump White House puts out one executive order after another and launches one management initiative after another that might make sense had it just won a landmark Supreme Court case uprooting old law, except that it hasn’t won those cases—it simply hopes to in the future. It’s speculating on wins in cases still unargued, carving nuggets from chickens still unhatched.
Thus, multiple spending-freeze moves seem based on the idea that the courts have already struck down the Impoundment Control Act as infringing on inherent executive power. (They haven’t.) Purges of employees at federal agencies, sometimes baldly based on inferred political loyalty, seem based on the idea that courts will nullify civil service rules and the Elrod v. Burns line of First Amendment cases (shielding some public employees from dismissal for partisan reasons on the same rationale. (They haven’t done those things, either.)
What happens if not all these cases go their way and the court doesn’t agree to strike down a long list of constraints on the executive, some, as with civil service, of considerable historic provenance? Then the events of recent weeks will look very much like a lawbreaking spree.