The United States is in the midst of a “constitutional moment,” a neologism invented by my Yale Law School colleague Bruce Ackerman to describe the reality that changes of constitutional magnitude are sometimes made in the United States without the benefit of a formal amendment to our constitution. The big issue now is an on-going reconsideration of “the Administrative State.” That pejorative term describes the gradual migration of decision-making power away from the popularly elected Congress and into a vast bureaucracy of unelected federal officials.

Another account on debates regarding this phenomenon – by Charles Keckler – here on Constitutional Discourse addressed the issue in trying to reconcile the paradoxical nature of independent agencies as ‘reverse parliaments’. This post intends to enrich this discourse with additional viewpoints such as the delegation and the major questions doctrines and offer continued insight for European scholars and professionals into the workings of the American administrative mindset.

The overwhelming majority of policy decisions made by the national government in the U.S. today are made by administrative officials, not elected ones. For example, the Code of Federal Regulations which codifies administrative regulations is about ten times longer than the statutes passed by the Congress. Under a 1946 framework statute, the Administrative Procedure Act, these administrative “rules” have the force and effect of law. Some support this massive transfer of power away from democratically elected officials and to subject matter “experts” in the federal agencies and departments, and others contend that the value of expertise is overrated. There is no doubt, however, that the national government of the United States has gradually been transformed.  Today a powerful fourth branch that resembles Plato’s “guardians” is running the government. This “ruling class” as a practical matter enjoys life-time tenure, selects its successors and is largely immune from supervision or political control.

This fundamental transformation of the structure of national government in the United States occurred gradually over decades. However, it fundamentally changed the nature of our government. For example, rather than making controversial policy decisions, the Congress now often prefers to write vague statutory language and “delegate” power to administrators.  This practice enables politicians to take credit for addressing an issue without actually making decisions that would offend one constituency or another. To some extent, these gradual changes in the U.S. since its 18^th century founding are part of a worldwide phenomenon by which more power had flowed to experts, such as those in the European Commission.

This is not the place to assess whether these changes are good or bad; that would take a book much longer than this short article.  Rather, the purpose of this article is to report on the on-going reassessment of the Administrative State by the judiciary in the United States.  This trend is just beginning and will continue for at least the next decade.  At the end, the article suggests a more productive lines of inquiry for the courts, a whole of the constitution approach that takes into account the “spirit” of the Constitution as well as its specific provisions.

How the Current Re-Examination Happened.

Early on Steve Bannon, a political adviser to the Trump Administration, promised “to deconstruct the administrative state” and Trump himself promised to “drain the swamp” of Washington bureaucrats and hangers-on of former government officials and lobbyists.  A good argument can be made that Trump fought the swamp, and the swamp won by swinging the 2020 election against him. However, due to a strange anomaly in U.S. practice, presidents only get to appoint new justices when a vacancy occurs on the Supreme Court thru death or resignation.  As a consequence, as president, Donald Trump was able to appoint three justices to the Supreme Court during his four years in office, whereas his left-leaning predecessor, President Barack Obama, was only permitted to appoint one justice despite having served for eight years, twice as long as Trump. Today our Supreme Court is divided 3-3-3, with three hard-core conservatives who claim to follow the original text and meaning of the Constitution, three Burkean conservatives who are more pragmatic in accepting some evolution beyond the Constitution’s original meaning and three liberals appointed by Democrats who follow their party’s line.  Six of the sitting justices have indicated a willingness to reassess the administrative state, and only four are require to agree to hear a case and five to decide it.  Moreover, according to press reports, if Mr. Trump is re-elected in 2024, he plans to implement an ambitious program to bring under Administrative State under Presidential control. Finally, the Supreme Court recently ruled that challenges to the structure of administrative agencies in the can be brought in court without going through the entire administrative process first, which can take 5 years or more and cost a great deal of money.  This ruling will greatly reduce the costs of bringing such challenges to court, and can be expected to unleash a flurry of cases challenging various structural aspects of the administrative state.

The Delegation Doctrine

The mainstay of conservative opposition to the administrative state is the so-called “delegation doctrine.”  Conservatives main argument is usually based on Article I, section 1 of the Constitution which states that “All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.” For some, this means that all delegations of power to administrative officers to make legally enforceable policy decisions are unconstitutional.

However, it is debatable whether a prohibition on delegation of legislative power was actually the original intention of the founding generation. On the contrary, the Constitution contains no explicit text prohibiting delegations of legislative power.  That is a major drawback to making a non-delegation argument the mainstay for constitutional analysis in an era in which all of our judges claim to be textualists. Rather, the argument for saying that the vesting clause prohibits delegation is based largely on an historical analogy to private principal-agent law, in which an agent is not allowed to subdelegate work to someone other than the person that the principle hired without consent of the principle.

Regardless of its historical meaning, over time the doctrine has evolved. What was originally called “the non-delegation” doctrine has gradually morphed to become “the delegation doctrine,” which holds that Congress MAY indeed delegate some of its legislative powers to administrative decision-makers provided that Congress makes the major decisions and leaves to administrators merely “filing in the details.” This supposed division of authority is implemented, if at all, thru the concept that Congress must lay down “intelligible principles” to cabin and guide administrative discretion. However, as Dean Ronald Cass has pointed out in his article, the Supreme Court’s decision in American Trucking upholding a statute with little or no guidance raises serious questions as to whether the intelligent principles version of delegation doctrine really has any bite.

In any case, the delegation doctrine has become the creation myth for the administrative state.  It is taught in all administrative law classes in U.S. law schools. As a result, for many U.S. lawyers, consideration of reining in the administrative state begins and ends with the delegation doctrine.  This is unfortunate, because the delegation doctrine in its various forms proves either too much or too little.  Because the delegation doctrine focuses only on the terms of the initial statutory mandate to an agency, it does little or nothing to rein in a variety of other abuses by the administrative state.^[1] In the final section of this article, a broader approach is proposed that requires the courts to consider whether delegations are consistent with the constitutional design generally, not merely whether Congress has provided intelligible principles to limit the agency’s substantive authority.

The Major Questions Doctrine

In recent years, the Supreme Court has developed – some critics would say made up out of whole cloth – “the major questions doctrine.”  This doctrine is at once both broader and narrower than classic delegation doctrine.  It is narrower, in the sense that it does not apply to all legislative decisions, but only a subset of “major questions,” which the Court has struggled to define in terms of economic impact and history.  Chief Justice Roberts was at pains in one of the most significant major questions doctrine cases, West Virginia v. EPA, to point out that the doctrine did not apply to circumstances in which “an agency was acting pursuant to a clear delegation” from Congress.  Thus, Chief Justice Robert’s version of the major questions doctrine recognizes the legitimacy of broad delegations of policy decisions to administrative decisionmakers, provided that Congress is clear about its intention to delegate the decision to the agency, as for example thru legislative history or statutory language.  However, If the Court decides that a “major question” is indeed involved, “intelligible principles” are not enough; Congress must either decide the policy issue itself or clearly indicate its intention to delegate the policy decision to an agency.

On the other hand, whereas traditional delegation doctrine law results in invalidating the statutory section in question as unconstitutional if Congress has not provided intelligible principles, the major questions doctrine only holds the agency’s decision invalid until Congress enacts legislation to give the agency or the Executive branch the powers that it had claimed.  Thus, the major questions doctrine would turn the process in the U.S. on major policy questions into one more like that in the European Union, in which experts in the Commission propose legislation that must then be enacted by the parliament to go into effect.

The Supreme Court has struggled to define exactly what qualifies as a “major question” – and as a result, many lower courts are finding major questions in many administrative determinations that they do not like.  However, most, if not all, of the Supreme Court’s major questions doctrine cases involve a common pattern: first the executive has requested legislation, but when Congress refused to pass clear statutory authority, the executive then claimed the authority to go ahead by interpreting existing law creatively as allowing what Congress had refused to pass explicitly.

A good example is President Biden’s attempt to “forgive” $400 billion of student education loans on the eve of the 2022 congressional elections, even though he and Speaker of the House Nancy Pelosi had both said he lacked existing statutory authority to do so. Perhaps the best explanation to date of the underlying basis for the major questions doctrine is articulated in Justice Barrett’s concluding opinion in the Supreme Court case holding that President Biden lacked the power to forgive student debt. Justice Barrett argues that the major questions doctrine is a rule of construction based on context.   However, she erroneously assumes that Congress would want “to make the big-time policy calls itself, rather than pawning them off to another branch” when actually Congress often wishes to avoid controversy – or cannot get sufficient majorities to adopt a solution.  In actuality, the major questions doctrine is an attempt by the courts to force Congress to make difficult decisions when it is reluctant to do so.  This is sometimes called a “remand to the legislature.” However, many, including the present author, are skeptical that the courts will be successful in requiring Congress to make difficult decisions but at least administrators will be unable to implement policies that Congress is unwilling to pass.

The Unitary Executive

Another active area of litigation involves the question of the extent to which the President, as head of the executive branch, may fire government officials at will.  This issue has been hotly debated under the rubric of “the unitary executive theory” since the decision in Humphrey‘s Executor, a 1935 case that held that Congress may insulate agencies exercising “quasi-legislative or quasi-judicial” functions from at will firing by the President. Recently, for example, a court just below the Supreme Court, the Fifth Circuit Court of Appeals, ruled that administrative law judges at the Securities and Exchange Commission could not be insulated from at will firing by the president. The Supreme Court has agreed to review that case in its next term, and its decision is likely to presage a reconsideration of the concept that some agencies are “independent” of presidential supervision and control.

An even more incendiary aspect of the same Fifth Circuit decision held that the SEC’s in house system of adjudication denies accused persons a right to trial by jury. This is a key aspect of Columbia Law School professor Philip Hamburger’s argument that the administrative state denies defendants their historic rights in the Anglo-American tradition going back to 1688.^[2]

Should Courts or Administrators Decide What Statutes Mean?

Under a 1984 Supreme Court decision, Chevron v. NRDC, courts are supposed to “defer” to interpretations by administrative agencies of the language of the statutes that they administer, even if the agency’s interpretation is not the natural reading of the language, if “Congress has not directly addressed the precise question at issue.” This Chevron doctrine has greatly expanded the power of administrative agencies and the executive branch at the expense of Congress and the courts, but it has been criticized as undermining the duty of the courts to say what the law is.  The Supreme Court has agreed to hear a case in its next term to either overrule or clarify the Chevron doctrine.

The “Necessary and Proper” Clause and “the Spirit of the Constitution.”

While the current judicial reconsideration of the administrative state is occurring on several fronts, as detailed above, to date it is piecemeal in the sense that it involves particular provisions of the Constitution.  The original sin that created uncertainty about the judicial role in assessing the structure of administrative agencies goes back to a seminal 1819 Supreme Court case, McCullough v. Maryland. That case involved the question of whether the federal government could create new institutions not specified in the Constitution, in that case a bank chartered by the national rather than a state government.  In a famous opinion by our greatest chief justice, John Marshall, the Court held that under the “Necessary and Proper” Clause of the Constitution, the national government did indeed have the power to create new institutions.  However, since the argument against the bank was that it was not “necessary,” most of the opinion dealt with watering down the “necessary” language to encompass institutions that are merely desirable or advantageous and not absolutely required.   However, in passing, the Court did remark that in order to be “proper,” new institutions must be consistent with the “spirit of the Constitution” as well as the letter of the law:

“Let the end be legitimate, let it be within the scope of the Constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the Constitution, are Constitutional.” 

For many years, however, the “proper” part of “necessary and proper” was largely forgotten. Chief Justice John Roberts attempted to correct this oversight in his opinion upholding the federal government’s take-over of the health care system by recovering the lost meaning of “proper”:

As our jurisprudence under the Necessary and Proper Clause has developed, we have been very deferential to Congress’s determination that a regulation is “necessary.” … But we have also carried out our responsibility to declare unconstitutional those laws that undermine the structure of government established by the Constitution. Such laws, which are not “consist[ent] with the letter and spirit of the constitution,” McCulloch, supra, at 421, are not “proper [means] for carrying into Execution” Congress’s enumerated powers.

The “spirit of the Constitution” test requires courts to consider more broadly whether the structure and functions of new institutions are consistent with the overall design features of the Constitution.  For example, one of the most thoughtful drafters of the Constitution, James Madison, opined that a key feature of our Constitution is the separation of powers into three branches:

“The accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, self-appointed, or elective, may justly be pronounced the very definition of tyranny.” 

However, today many administrative agencies do exercise all three kinds of power, legislative, executive and judicial. Many of the architects of the administrative state such as Woodrow Wilson and James Landis^[3] thought that separation of powers was an inefficient relic and proudly proclaimed that administrative agencies should exercise all three kinds of powers. No specific text in the Constitution prohibits this design, although it is inconsistent with the overall design of the Constitution itself which divides power to protect liberty.

It remains to be seen whether the on-going judicial reconsideration of the structure of the administrative state will go so far as to require that administrative powers must be consistent with the overall design features immanent in the Constitution, which Chief Justice Marshall called “the spirit of the Constitution,” or merely its specific provisions.

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^[1] See generally Philip Hamburger, Is Administrative Law Unlawful (Chicago, Illinois: The University of Chicago Press, 2014); Philip Hamburger, The Administrative Threat (New York: Encounter Books, 2017).  For a critical review, see Adrian Vermeule, ‘No’ Review of Philip Hamburger, ‘Is Administrative Law Unlawful?’, 93 Tex. L. Rev. 1547 (2015), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2488724.

^[2] See Hamburger, supra note 1.

^[3] See James Landis, The Administrative Process 2 (New Haven: Yale Press, 1938)(“The insistence upon compartmentalization of power along triadic lines gave way in the nineteenth century to the exigencies of governance.  …[A]gencies were created whose functions embraced the three aspects of government.”)

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E. Donald Elliott is a Florence Rogatz Visiting Professor of Law, Yale Law School; Distinguished Adjunct Professor, Antonin Scalia Law School; Senior Fellow, Administrative Conference of the United States. Acknowledgement: “I wish to thank the participants in the 2023 Alyeska Colloquium of the Judge Douglas H. Ginsburg Judicial Colloquium Series sponsored by the Law and Economics Center of the Antonin Scalia Law School of George Mason University for thoughtful discussion of a precursor to this article.  Of course, responsibility for the errors that remain is mine alone.”