Justices Give the President Power Over Independent Agencies

The Supreme Court has ruled on the limits of executive power over independent federal agencies. In Trump v. Slaughter, the Court considered the president’s firing of Rebecca Slaughter, a member of the Federal Trade Commission. Because FTC commissioners are nominated for fixed terms and confirmed by the Senate, Slaughter argued that the president lacked the authority to remove her before her term expired.

Several issues are at stake here. First, the FTC, like many of the eighty or so “independent” agencies, is required by law to be “bipartisan.” The FTC has five members, three of whom must belong to the president’s party. Under Biden three members were democrats and two were republicans, with the chairman a democrat. Trump’s election victory would normally have prompted that chairman to resign—regardless of how much time remained in the term—allowing the president to appoint a republican chairman. In effect, at the FTC, Trump preempted that tradition by firing a democrat to secure a republican majority sooner.

The second issue is more fundamental. These agencies sit technically within the executive branch, yet they make legislative-style policy decisions with independence from the president. The central question is whether the president should have authority over them. The Supreme Court answered yes, in a 6–3 vote, holding that the president may remove any member of these agencies without cause. Chief Justice Roberts wrote that the case was not a difficult one for him: “Nearly 250 years ago, the Framers decided to vest ‘[t]he executive Power’ in one person – a President of the United States of America. The choice was not made lightly.” Roberts added that executive officers “were to serve as envoys of the president, not his equals. … Because these officers were subject to the president’s superintendence, they had to be removable by him at will.”

Justice Sotomayor wrote the dissent, noting that “Congress and the president together have decided that some government functions should operate at a distance from partisan politics.” She echoed Woodrow Wilson’s vision of “progressive governance,” arguing that some functions of government should be overseen by experts in those fields, writing that “the wisdom of the centuries has taught that some decisions should depend not only on who is in office—much less on who is disfavored or owed a favor by those in office—but also on judgment, expertise, and the public good.” Yet this assumes that such “experts” operate independent of political agendas, rather than carrying their own.

Justice Sotomayor surely knows better, as do Justices Kagan and Jackson, who joined her dissent. As I’ve argued before, the officials who write regulations—in essence, make law—at these agencies do so without presidential approval, subject only to congressional oversight. So the more relevant question may be why these bodies aren’t simply made part of the legislative branch rather than the executive branch. Sotomayor is correct that this ruling substantially expands presidential power. As she put it, “the Court gives the President a power unknown even to the English Crown against which the Founders revolted.”

On that point, she is correct—and notably, Justice Gorsuch, who joined the majority, agreed with her. Gorsuch wrote that it was doubtful Congress would have given executive-branch agencies such expansive authority—especially quasi-legislative and quasi-judicial authority—if the president could control them without the other constitutional checks Congress had tried to impose. “From here,” he wrote, “the only sure path is to finish the journey we start today and restore legislative and judicial powers to where they belong: in Congress and the courts.”

Because this ruling applies to all independent agencies except the Federal Reserve, it presumably extends to the banking agencies as well, including the FDIC and the National Credit Union Administration. At the NCUA, Trump removed both democratic board members—including one he had nominated during his first term—leaving only the republican member in place. The NCUA had until 1978 been led by a single administrator who, like the Comptroller of the Currency, served at the pleasure of the president. When the law was changed, the NCUA board was created and I was appointed by President Carter to serve on that first board. Going forward, the president will still be bound by the statute’s bipartisan requirement, but will have to appoint one democrat and one republican to the NCUA board—either of whom can now be removed without cause. It will be interesting to see whether this ruling affects the caliber of future appointees, and whether the president now takes a more active role in these agencies’ rulemaking.

Lastly, I thought that like Chief Justice Roberts, that this was not a difficult case, that the precedent, Humphrey Executor was a decision likely to be overturned. I also believed that if Trump were not president that the vote would have been 9-0. Sotomayor, Kagan and Jackson were voting against giving Trump more power rather than ruling on the basis of the Constitution. I am certain that they would have voted otherwise if a democrat were president.

Next, I will post on Trump v. Cook, the special case of the Federal Reserve.