The Limits of Administrative Power

Sep 18, 2023

With federal agencies increasingly unmoored, judges hoping to protect the constitutional order must step in.

Last year, when the Environmental Protection Agency claimed the power to use an obscure provision of the Clean Air Act to shut down coal and natural-gas electrical-generation plants, the Supreme Court ruled that its action was not authorized by the law. Concurring in the judgment of West Virginia v. EPA, Justice Neil Gorsuch wrote that the Court's decision was based on the nondelegation doctrine—the idea that the Constitution authorizes only Congress to make the law and limits the legislature's ability to sign away that lawmaking power. With other administrative agencies now following the EPA's lead, judges hoping to preserve the constitutional order may have to rely on that principle.

Take the Federal Trade Commission's recent turn under chairwoman Lina Khan. The FTC has authority to sue companies to halt "unfair" practices affecting commerce. It gets to decide what "unfair" means, since Congress provided no guidance in the legislation that created the agency.

Khan is using that powerful tool to reshape American business to fit her ideological goals. For instance, according to the Select Subcommittee on the Weaponization of the Federal Government, Khan's FTC posted more than 350 requests on Twitter shortly after Elon Musk took over the company—asking for the identities of the "Twitter Files" journalists and for documentation on Musk's firing of James Baker, the former FBI general counsel who used his position at Twitter to stop the release of internal documents that showed how the company had suppressed the Hunter Biden laptop story. None of those requests has anything to do with protecting consumers from unfair business practices, but they do serve partisan political purposes.

Until now, courts have turned a blind eye to the vast delegation of legislative power to administrative agencies, citing the "increasing complexity of human activity." But turning over legislative authority to administrative agencies poses a danger against which the framers of the Constitution sought to guard.

The Constitution entrusts lawmaking to our elected representatives, who are divided into two chambers. The people who wrote and ratified this plan of government were justifiably suspicious of a "ruling class of . . . unaccountable ‘ministers,’ " as Gorsuch put it in the EPA case. Indeed, one of the complaints against the Crown made in the Declaration of Independence was that the king had created new government offices and "sent hither swarms of Officers to harass our people, and eat out their substance." The Constitution made lawmaking purposefully difficult in order to protect individual liberty and to ensure as broad as possible a consensus on the laws governing day-to-day life.

Rule by unelected administrators runs contrary to the plan of government set out in the Constitution. Khan's FTC demonstrates why this is a bad idea. One FTC commissioner recently resigned because, in her view, Khan focuses on her own social goals rather than on consumer welfare. Vague legislative authority and a judiciary that, until recently, has been unwilling to enforce the separation of powers enables her caprice.

Consider another recent example of the FTC's abuse of power. Kochava is a company that buys geo-location data from social-media firms and sells the data sets to advertisers. If you search for the nearest Burger King or McDonald's on Google, then advertisers can use that information to send you targeted ads about specials at your favorite burger joint. The FTC is suing Kochava, which lawfully purchased such data from larger firms, out of concern that someone might purchase geo-location data to see who is visiting "reproductive health clinics, places of worship, homeless and domestic violence shelters, and addiction recovery facilities." No evidence exists that anyone tried to purchase data sets from Kochava for this purpose, or that Kochava has created such specific data. In fact, before the FTC contacted Kochava, the company was already working to create a filter that would block the use of its data sets for such purposes. That's not enough for the FTC under Khan, however, which asserts that the company is engaging in unfair trade practices.

An unmoored FTC shows the wisdom of limiting administrative power. Congress never considered that the selling of lawfully acquired data for lawful purposes could be considered "unfair." In many ways, Kochava's selling of these data helps consumers by allowing companies to send relevant advertisements—information that consumers are likely to want. Our laws are supposed to reflect our wishes, as enacted through our representatives in Congress. Rule by unaccountable ideologues doesn't meet that test.

Anthony T. Caso is a senior legal fellow at the Claremont Institute and a retired professor at Chapman University's Fowler School of Law.

Photo: FinkAvenue/iStock

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