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Analysis

Supreme Court Considers Expanding Presidential Power

The new conservative majority could make political interference easier in independent government agencies that safeguard public health and wellbeing.

December 9, 2020

This piece was origin­ally published in Just Secur­ity.

This week with the oral argu­ments in Collins v. Mnuchin, we’ll have our first look at how the Supreme Court with its new 6–3 conser­vat­ive major­ity might expand the power the pres­id­ent has over inde­pend­ent govern­ment agen­cies and increase the poten­tial for polit­ical inter­fer­ence in work those agen­cies do to protect the health, safety, and welfare of the Amer­ican people. The case centers on the Federal Hous­ing Finance Agency, which over­sees the federal home mort­gage programs Fannie Mae and Fred­die Mac, and the plaintiffs are chal­len­ging the consti­tu­tion­al­ity of the agency’s lead­er­ship struc­ture, a single director appoin­ted by the pres­id­ent (as opposed to a multi-member board) who can’t be fired without cause — a struc­ture some other inde­pend­ent agen­cies share. If the Court found the removal-for-cause protec­tion uncon­sti­tu­tional, it would make it easier for the pres­id­ent to termin­ate inde­pend­ent agency heads for insub­stan­tial reas­ons, hamstringing agen­cies’ abil­ity to fulfill their missions free from polit­ical pres­sure.

The prognosis isn’t good. In Seila Law v. CFPB last term, the Court struck down the removal-for-cause protec­tion for the head of the Consumer Finan­cial Protec­tion Bureau (CFPB). The major­ity invoked the unit­ary exec­ut­ive theory, which holds that the pres­id­ent must have direct control over all aspects of the exec­ut­ive branch. Proponents of the most extreme form of the unit­ary exec­ut­ive theory believe that stat­utory require­ments that exec­ut­ive branch person­nel can only be fired for cause are uncon­sti­tu­tional infringe­ments on the pres­id­ent’s power and viol­ate separ­a­tion of powers.

Contrary to the major­ity’s claim in Seila Lawpoliti­ciz­a­tion of core govern­ment func­tions does not improve govern­ment’s account­ab­il­ity to the Amer­ican people; in fact, it can threaten the rule of law. Strip­ping govern­ment offi­cials of for-cause removal protec­tion removes insu­la­tion from polit­ical pres­sure, in that the pres­id­ent can force them to capit­u­late to a direct­ive — even if it’s illegal or uneth­ical — or fire them. Insu­la­tion from polit­ical pres­sure has helped ensure the even­han­ded admin­is­tra­tion of the law. As the Bren­nan Center’s bipar­tisan Task Force on Rule of Law & Demo­cracy has argued, from the Depart­ment of Justice to scientific agen­cies, the rule of law depends on commit­ted, ethical person­nel who are able to carry out govern­ment func­tions without undue politi­ciz­a­tion.

Collins v. Mnuchin

The plaintiffs in Collins v. Mnuchin are former share­hold­ers of Fannie Mae and Fred­die Mac. They are claim­ing that the struc­ture of the Federal Hous­ing Finance Agency (FHFA) is uncon­sti­tu­tional in order to chal­lenge the agency’s author­iz­a­tion of payments to the federal govern­ment to compensate for its bail­out of Fannie and Fred­die during the last finan­cial crisis. Although the lawsuit focuses on removal for cause, Collins does­n’t involve the employ­ment status of an actual director of the FHFA or attempts to fire that person. It is an attack on the legit­im­acy of the agency based on the exist­ence of the removal-for-cause protec­tion, which the director has had since the agency’s creation by Congress in 2008.

For-cause removal protec­tion for the lead­ers of inde­pend­ent agen­cies is a common and long­stand­ing congres­sional tool to insu­late those agen­cies from polit­ical pres­sure. This require­ment prevents the pres­id­ent from firing an inde­pend­ent agency director over mere personal or policy disagree­ments. When the Supreme Court in Seila Law struck down for-cause removal protec­tion for the director of the CFPB, it left many unanswered ques­tions, includ­ing whether or not the decision should apply to other pres­id­en­tial appointees with for-cause removal protec­tion. This Wednes­day’s argu­ments in Collins could shed light on the justices’ think­ing.

The Court’s reas­on­ing in Seila Law turned at least in part on the fact that CFPB — like the FHFA in Collins — is led by a single pres­id­en­tially-appoin­ted director, not a multi-member board appoin­ted by the pres­id­ent. At the same time, the major­ity tele­graphed some ambi­val­ence about a seminal case uphold­ing for-cause removal protec­tion in the case of a multi-member board, Humphrey’s Executor v. United States (1935). Some justices would go even farther — in a concur­ring opin­ion joined by Justice Gorsuch, Justice Thomas called for Humphrey’s Executor to be over­turned and posited that all inde­pend­ent agen­cies are uncon­sti­tu­tional.

The Court in Seila Law also focused on the fact that the CFPB admin­is­ters 19 stat­utes, “includ­ing a broad prohib­i­tion on unfair and decept­ive prac­tices in a major segment of the U.S. economy.” This vague char­ac­ter­iz­a­tion of the CFPB’s impact on a “major segment” of the economy could poten­tially apply to the FHFA, as well as dozens of other inde­pend­ent govern­ment agen­cies charged with crit­ical govern­ment func­tions, from regu­lat­ing secur­it­ies to ensur­ing mine safety. The Seila Law major­ity ques­tioned the consti­tu­tional valid­ity of both the CFPB and the FHFA, which were created in response to the Great Reces­sion, and other single-leader agen­cies at least partly on the grounds that they are all “modern.”

The Util­ity of Single-Leader Agen­cies

As with the CFPB, Congress had good reas­ons to struc­ture the FHFA as it did. In the 85 years since the Supreme Court upheld for-cause removal for the commis­sion­ers of the Federal Trade Commis­sion in Humphrey’s Executor, the economy has become more complex, the federal regu­lat­ory process has become length­ier and more involved, and the Senate confirm­a­tion process has become more fraught. In order to respond with agil­ity and expert­ise to press­ing soci­etal needs, Congress has struc­tured a few modern regu­lat­ory agen­cies with a single Senate-confirmed leader whom the pres­id­ent can’t fire without cause. (In certain situ­ations – such as in the case of agen­cies that regu­late campaign finance law or other elec­tion-related issues, when there is a risk of the agency being weapon­ized by the party in power to perse­cute its oppon­ents – the Bren­nan Center has advoc­ated for Congress to employ a multi-member, bipar­tisan lead­er­ship struc­ture.)

The 2009–2013 appoint­ments saga of the National Labor Rela­tions Board under­scores the advant­ages of a single leader struc­ture over a multi-member board. This New Deal era agency is led by six pres­id­en­tial appointees and admin­is­ters a single stat­ute, primar­ily by means of formal adju­dic­a­tion, one labor dispute at a time. When Senate Repub­lic­ans refused to allow the confirm­a­tion of Pres­id­ent Obama’s nomin­ees to the Board, the Supreme Court issued a series of three decisions inval­id­at­ing hundreds of cases, repres­ent­ing several years’ worth of the agency’s work, on vari­ous grounds — lack of a quorumimproper recess appoint­ments, and an improper acting appoint­ment. To illus­trate the human impact of these setbacks, a worker whose employer fired him in retali­ation for his union activ­ity was forced to take a nearly 70 percent pay cut and lost his home to fore­clos­ure while wait­ing over four years for a prop­erly consti­tuted Board to adju­dic­ate his case.

The Dangers of an Expand­ing Unit­ary Exec­ut­ive Theory

If the Court inval­id­ates the FHFA’s struc­ture in Collins, it will repres­ent an expan­sion of the prin­ciples announced in Seila Law, to our soci­ety’s detri­ment. Accord­ing to the unit­ary exec­ut­ive theory, exec­ut­ive power should be concen­trated in the hands of the pres­id­ent, to whom federal agen­cies should be more respons­ive. But consol­id­at­ing exec­ut­ive power by ending for-cause removal for agency heads threatens to under­mine the effect­ive­ness of the agen­cies they lead. Indeed, federal agen­cies are less able to imple­ment expert­ise-driven responses to the nation’s prob­lems in an effi­cient manner if their lead­ers have to contend with inter­fer­ence driven by polit­ical motives rather than the facts.

The unit­ary exec­ut­ive theory is part of a constel­la­tion of legal prin­ciples gain­ing momentum with the Court that are dressed up as ways to improve govern­ment but have the perverse effect of making it less func­tional. The nondelega­tion doctrine, for example, has been cited by some current justices as a reason for prevent­ing Congress from direct­ing federal agen­cies to decide “major” policy ques­tions. And several justices have exhib­ited skep­ti­cism of legal doctrines that afford defer­ence to agency expert­ise, which doctrines have long served as the basis for uphold­ing agency regu­la­tions.

It remains to be seen, in this case and future cases, whether the Supreme Court will begin to embrace the inter­pret­a­tion of the unit­ary exec­ut­ive theory that proponents of the theory in the Trump admin­is­tra­tion have expounded — namely, that the pres­id­ent should have the abil­ity to fire not only agency lead­ers but all federal employ­ees for any reason or no reason at all. For instance, the acting head of the Office of Person­nel Manage­ment — the federal govern­ment’s human resources agency —  ques­tions the consti­tu­tion­al­ity of civil service protec­tions, which have exis­ted for nearly 150 years and shield career govern­ment employ­ees from polit­ic­ally motiv­ated firings. Reflect­ing this view, Pres­id­ent Trump recently issued an exec­ut­ive order elim­in­at­ing for-cause removal protec­tion for poten­tially hundreds of thou­sands of civil service posi­tions, giving teeth to his threats to fire National Insti­tute of Allergy and Infec­tious Diseases Director Anthony Fauci.

The consequences for the federal govern­ment of an expan­ded unit­ary exec­ut­ive theory would be signi­fic­ant: high turnover, low compet­ence, and less expert­ise, all of which serve the interests of oppon­ents of regu­la­tion more than those of an admin­is­tra­tion seek­ing to protect consumers, public health, worker safety, and the envir­on­ment. If the Supreme Court contin­ues down its current path, we could soon have a govern­ment more inclined to serve partisan interests than the public interest when it comes to pivotal issues affect­ing Amer­ic­ans’ every­day lives, while the economic, health, and envir­on­mental chal­lenges facing this coun­try become more multi­fa­ceted and complex.