The Supreme Court is Right on Executive Power

by Ryan Thiele

This past summer, the U.S. Supreme Court released their opinion in Seila Law LLC. v. Consumer Financial Protection Bureau. The case turned on arguably some of the most difficult questions found under our Constitution: how far does presidential power extend? What opportunities, if any, are available for other political actors to check his power?

The Consumer Financial Protection Bureau administers a number of statutes overseeing consumer protection in investments, credit, loans, and retirement. It is led by a single agency director nominated by the President and elected to a five-year term once confirmed by the SenateThe CFPB director is subject to removal only “for-cause,” meaning “inefficiency, neglect of duty, or malfeasance in office.” Interestingly enough, the Bureau  is funded by the Federal Reserve, rather than a Congressional appropriation.

There are a number of concerns with this administrative structure. First, independent agencies are typically overseen by multi-member commissions ; no other federal bureaucracy  entrusts an individual supervisor with such broad powers. While there are some exceptions, such as the Social Security Administration’s single commissioner, they lack the enforcement power and expansive regulatory capabilities that are found in the Bureau. Coupled with the for-cause protections, it is possible that a president could have little to no control over the agency while it regulates the country’s financial institutions.

Therefore, does the vesting of substantial executive authority in the Consumer Financial Protection Bureau, an independent agency led by a single director, violate the separation of powers? The Supreme Court held that it does, and rightly so. With the amount of regulatory and enforcement power available to CFPB, placing one person in charge of an agency and limiting their accountability hinders the ability of the president to properly administer laws passed by Congress. As Chief Justice Roberts notes in the majority opinion: “individual executive officials may wield significant authority, but that authority remains subject to the ongoing supervision and control of the elected President. The CFPB’s single-Director structure contravenes this carefully calibrated system by vesting significant governmental power in the hands of a single individual who is neither elected by the people nor meaningfully controlled (through the threat of removal) by someone who is.”

Article II of the Constitution vests all executive power in the president; it is therefore  the president’s responsibility to execute and administer the laws passed by Congress. He delegates the administration of his duties to principal officers who, following approval by the Senate, execute the laws in his name. How is the President supposed to faithfully follow his obligations if his officers are unaccountable even to him? It presents a structure in which independent agencies are accountable to no one once placed in office. Surely a CEO would have a difficult time managing their corporation if managers could not be fired. It is equally preposterous to suggest a business owner should not be able to exercise his or her ability to fire an employee who is negligent in their tasks. In terms of institution building, the executive branch is no different. 

During oral arguments, Justice Kagan alluded to the idea that it could possibly be easier for a president to control an agency if the agency was headed by a single director.  Justice Kagan implies here that this might expedite the enforcement of statutes rather than force the Bureau to suffer the consequences of deliberation that come with a multi-member commission. Then U.S. Solicitor General Noel Fransisco, arguing in support of Seila Law, responded that “for a single-headed agency, often the only restraint on the exercise of power is a political or democratic accountability restraint. And once you remove that, you’ve now vested enormous executive power in somebody who is not subject to the procedural constraint that multi-member commissions have and are not subject to the political constraint that everyone else has.”

The Solicitor General was precisely correct. By placing officials into positions of incredible power with limited accountability, we open the possibility for abuses of power, or, heaven forbid, agency capture. It is unimaginable that the Secretary of Defense would be given similar treatment with his task of overseeing national defense against our enemies, allowing him to make military decisions without the president’s approval. That would fly in the face of the president’s responsibility to conduct war affairs. Similarly, independent agencies and their for-cause protections shield officers from accountability to the president whose responsibility it is to execute the laws. The Court adopted this argument and subsequently severed the for-cause protection from the statute, leaving the agency to be led by a single director who can be removed at will by the President.

It is worth noting Justice Clarence Thomas’ (partially) concurring opinion that was joined by Justice Neil Gorsuch. Thomas denounced the primary case used in defense of the CFPB, Humphrey’s Executor, the New Deal era case that upheld independent agencies, their for-cause protections, and establishment of multi-member commissions. He and Gorsuch believe the case should be overturned and Myers v. U.S. — a case upholding the President’s ability to remove executive officers decided, a decade prior to Humphrey’s Executor — should be the standard for all executive branch officers.

Concerns over executive power are warranted. The president and his officers today exercise more power over their fellow Americans than at any point in the history of the republic. This can be partially attributed to Supreme Court decisions that have allowed for such expansions of power, typically through the Commerce Clause, or simply by the changing nature of a contemporary era. Yet, the expansive power of the Executive should be primarily attributed to Congress for it is Congress who passes legislation empowering the president with these powers. If Congress did not want the President to enact certain types of regulations or procedures, then legislation should not grant those abilities. Further, if the president were to overstep their bounds in executive authority, Congress should hold them accountable and check their power, regardless of political affiliation. Should Congress find something so pressing as to pass a law for its oversight, it should come with a strict intelligible principle that specifically guides the Executive branch on its administration. The question then is not what restraints to place on him, but what power to give him. Time will tell if this position is adopted in a future separation of powers case, but for now we should be glad with the Court’s decision to maintain the separation of powers in Seila Law