Leah Litman  //  5/19/17  //  Commentary


Next week the en banc D.C. Circuit Court of Appeals will hear oral argument in PHH v. Consumer Financial Protection Bureau. PHH raises the question whether the CFPB’s structure is constitutional. As its name suggests, the CFPB is the agency that addresses predatory business practices that are harmful to consumers, among other things. And the CFPB Director, like other heads of independent agencies, is removable by the President only for cause—that is, for gross malfeasance, incompetence or alike. 

PHH is arguing that the CFPB’s structure is unconstitutional because it infringes on the President’s power to execute federal law. That is, because the President cannot remove the Director of the CFPB, the argument goes, the President does not have a sufficient degree of control over the Director and the CFPB itself.

You heard that right:  The argument for why the CFPB is unconstitutional rests on the claim that the President of the United States does not have enough power over the CFPB.  That argument has an air of …. let’s call it …. poor timing. Last week, President Trump fired the Director of the FBI, James Comey.  While the President has the authority to remove the FBI Director, there is legitimate concern about how the President exercised that authority. The President and his subordinates have indicated the President fired Comey in order to stymie the investigation into Russia-related wrongdoing, because Comey had refused to confirm Trump’s unsubstantiated application that Trump had been wiretapped, or some combination of those and other troubling reasons.

One can imagine how the Comey affair, coupled with President Trump’s other dabbling in authoritarian- and autocrat-like behavior, would make one skeptical of any argument that has as a key premise that the President of the United States does not have enough power.  Recognizing this situation, Jonathan Adler tweeted about a recent op-ed that ran under the title “Make the CFPB accountable by increasing presidential power.” Alder quipped “not exactly the best time to make this argument.”

He’s right.  But unfortunately for PHH (and for Trump’s DOJ, which SURPRISE! is arguing that Trump does not have enough power, at least over the CFPB), the argument that the President does not have enough power over the CFPB can’t be divorced from the constitutional argument against the CFPB. That is the agument: At bottom, the argument that the CFPB’s structure is unconstitutional is an argument that the President does not have enough power over the agency. That’s what the substance of the constitutional claim against the CFPB is—that the CFPB’s structure infringes on the President’s power under Article II.  (If you have any doubts about that characterization of the argument, I’d encourage you to read Judge Kavanaugh’s opinion for the panel in PHH.)

I wrote about this issue after President Trump nominated Justice Gorsuch to the Supreme Court. Justice Gorsuch’s supporters were fond of pushing the narrative that a Justice Gorsuch would be good for the separation of powers because Justice Gorsuch believes in a strict separation between the three branches of the federal government.  As evidence of Justice Gorsuch’s commitment to the separation of powers, his defenders would point to Justice Gorsuch’s criticism of the Chevron doctrine, the doctrine under which federal courts defer to agencies’ interpretation of ambiguous statutes.  

 What irked me about this narrative is that it felt misleading, and some of the people pushing this narrative are thoughtful enough to know it was misleading. In the context of Chevron, Justice Gorsuch’s commitment to the “strict” division of powers between the three branches of the federal government reduced executive power.  If Chevron is overruled, then the executive branch has relatively less power to interpret federal statutes, and the federal courts have relatively more power to do so.  And Justice Gorsuch’s defenders knew that this narrative about Justice Gorsuch limiting executive power would appeal to the media and to the public who were (rightly as it turned out) concerned about how the authoritarian-sympathizing Trump would exercise the substantial powers of the Presidency of the United States.

However, Justice Gorsuch’s commitment to the “strict” division of powers between the three branches of the federal government does not always or even reliably reduce executive power. Sometimes his separation-of-powers formalism (by which I mean the view that there is a strict division of power between the three branches of government) will increase executive power. That doesn’t necessarily mean Justice Gorsuch’s views are wrong; Justice Gorsuch’s views on executive power are shared by many other thoughtful people on the right.* But it does mean that the Justice-Gorsuch-will-invariably-limit-President-Trump’s-executive-power narrative was at least overly simplistic and perhaps misleading.

The current challenge to the CFPB’s structure makes that clear.  (The challenge to the CFPB was the example I used when I wrote about this issue earlier.) I’ll be writing more about the challenge to the CFPB next week.  But as an intro to the case, I wanted to make clear what the substance of the challenge to the CFPB is about—the claim that the President does not have enough power.

*That doesn’t mean Senators should not ask an individual who shares that view what that individual might do about independent agencies, especially if the position to which the individual has been nominated involves supervising independent agencies.

 

 

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