Closing Time for the So-Called Independent Regulatory Agencies
Congressman Chaffetz may profess to be shocked to find executive-branch “interference” going on at the FCC. But in fact, President Obama’s “interference” is good news for constitutional government.
Unlike Jacob Marley, Scrooge’s partner, who was dead to begin with, William E. Humphrey was not dead to begin with: not in 1925, when he was appointed to the Federal Trade Commission by President Calvin Coolidge; not in 1931 when he was reappointed by President Herbert Hoover; not in October of 1933, when President Franklin Roosevelt sent him a letter saying, “… you are hereby removed from the office of Commissioner of the Federal Trade Commission”; and not when he refused to leave office. But he was dead four months after his dismissal, and so it fell to his executor to sue for the salary he was owed from the time Roosevelt fired him until his death. In 1935, the executor won the suit for Humphrey’s back salary in a case the U. S. Supreme Court got terribly wrong, known as Humphrey’s Executor v. United States.
Which takes us to President Obama’s interference with the decision-making process of the Federal Communications Commission and, possibly, of the Federal Trade Commission as well.
Humphrey’s Executor v. United States stands for the proposition that the so-called independent regulatory agencies, which is to say, their commissioners, are independent of the president. The court held that the Federal Trade Commission’s duties “are neither political nor executive, but predominantly quasi-judicial and quasi-legislative.”
Eighty enlightened years after Humphrey’s Executor v. United States, we should be asking, Where on earth—or more precisely, where in the U.S. Constitution—did the Court find justification for the existence of a body truly independent of the executive, the legislative, and the judicial branches? The right answer, of course, is: Nowhere. The Constitution makes no provision for such a government entity. Articles I, II, and III (and specifically their “Vesting Clauses”) vest the legislative powers in the Congress, the executive powers in the president, and the judicial powers in the courts. There is no provision for a body that is “neither political nor executive, but predominantly quasi-judicial and quasi-legislative.”
Nevertheless, for decades the so-called independent regulatory agencies have operated independently (more or less), relying primarily on the Supreme Court’s decision in Humphrey’s Executor v. United States.
From time to time, though not always, the various commissioners of the so-called independent regulatory agencies have been reluctant to seem to be taking directions from the White House.
The agencies’ relations with Congress have been more problematical. Congress has oversight responsibilities over the agencies, but is supposed to avoid bringing undue pressure, or even giving the appearance of bringing undue pressure, on the agencies to make decisions.
Sometimes a congressman will step, or fall flat on his face, over the line. In 1987, a congressman called the chairman of the Federal Trade Commission while the commission was investigating a merger of two corporations in his state and threatened to take away his dining room if the FTC’s decision went against the congressman’s wishes. The congressman was politely told that the chairman of the FTC didn’t have a dining room.
In Humphrey’s Executor v. United States the Supreme Court said, “The debates [over the creation of the Federal Trade Commission] in both houses demonstrate that the prevailing view was that the commission was not to be ‘subject to anybody in the government, but … only to the people of the United States’; free from ‘political domination or control’ or the ‘probability or possibility of such a thing’; to be ‘separate and apart from any existing department of the government― not subject to the orders of the President.’”
But that, on its face, upends the whole constitutional scheme. By attempting to make the commission subject “only to the people,” Congress made it subject to no one. Being “free from ‘political domination or control’” means being free from democratic accountability.
Until, perhaps, now. Last fall, President Obama announced his position that the Internet should be regulated like any other public utility. His announcement is said to have blind-sided officials at the Federal Communications Commission, who had been planning far more modest regulations. However, the Chairman of the FCC, Tom Wheeler, fell into line, and in February the FCC voted to impose the “net neutrality” policy. So much for independence from political control. Now Rep. Jason Chaffetz (R., Utah), chairman of the House Oversight and Government Reform Committee, is planning to investigate the decision-making process.
Chaffetz may profess to be shocked to find executive-branch “interference” going on at the FCC. But in fact, President Obama’s “interference” is good news for constitutional government. Decisions like Chairman Wheeler’s should not be made by people who were not elected and are not accountable to anyone.
But wait: there’s more. Google officials had a plethora of meetings with White House officials while the Federal Trade Commission was contemplating bringing an action against the company (an average of one meeting a week, totaling 230, constitutes a plethora). The FTC finally decided not to take action.
There’s an old New York State case that holds that when a man and a woman, not his wife, register at a hotel under assumed names and spend the night together, it is presumed they did not spend their time discussing the weather.
The same presumption, mutatis mutandis, holds for the Google officials and the people they met at the White House. But there’s no venality on Google’s part. They had the access, and if they hadn’t used it, the stockholders would have been right to complain.
We don’t know if President Obama put pressure on the FTC commissioners, but why should we be surprised if he did? The FTC commissioners may profess to be shocked, shocked, that anyone could even think such a thing. But our experience with the Federal Communications Commission’s decision makes that thinking entirely plausible.
Here’s the point: President Obama—indeed, any president—should seek, not just to influence the decisions of the so-called independent regulatory agencies, but to command them. Then, if the people don’t like the decisions, they can vote for a different kind of president in the next election.
And the next president, if he’s a Republican, should fire all the Democratic commissioners (and also any “misbehaving” Republican commissioners) of all the so-called independent regulatory agencies, starting with Tom Wheeler at the FCC. They would sue, allowing the Supreme Court to overturn Humphrey’s Executor v. United States and establish, once and for all, that the independence of the so-called independent regulatory agencies is dead. Really dead. Every bit as dead as Marley was to begin with.