Dean Shapiro: A hidden way politics shapes regulation

March 18, 2024

Regulations issued by executive branch agencies often get criticized by regulatory opponents as being made by “unelected bureaucrats,” divorced from political pressures and the messiness of democracy. Partly because of that sentiment, the Supreme Court appears poised to overturn a major precedent in administrative law known as “Chevron deference.”

To show why the idea that regulations are not subject to political influence is misguided, we need only look back to last month, when the Biden administration delayed emission standards for power plants that burn natural gas. The delay will ensure that the burden of the new standards does not fall upon these utilities until after the November election. This move echoed a decision by the Obama administration to delay consideration of ozone standards in 2011 with the 2012 presidential election looming.

These are instances of politics clearly affecting executive branch regulatory decisions. Both Presidents Obama and Biden decided that the political risks of imposing new requirements on industry during a tight presidential campaign outweighed the benefits of doing so.

But politics always affects regulatory decisions. It is not a coincidence that Democratic presidents supported by environmentalists and labor unions tend to impose stricter regulations on industry. Nor is it a coincidence that Republican presidents, often supported by industry, attempt to deregulate and generally impose fewer regulations (except in areas like homeland security and immigration — spaces where their voters support strict regulation).

And that’s okay. We should want a regulatory system that, as a first priority, adheres to the statutes passed by Congress and signed by the president. However, these statutes will necessarily be unable to answer every policy question that appears before a country that grows more complex with every year.

To address these questions, two forces should be brought to bear. The first is expertise, which is housed at the agencies of the executive branch. The second is political responsiveness, which comes from the president. The push and pull between expertise and responsiveness is hard to balance, but few would argue that neither should be present.

Interestingly, there is a Supreme Court decision that embodies this balance. Chevron v. NRDC, decided in 1984, set up a two-step process for judicial evaluation of the legality of agency regulations. The first step is to examine whether the statute the agency is operating under speaks clearly about the area the agency is regulating. If it does, then the analysis is merely whether the agency followed this clear language when it issued its regulation.

If the statute does not speak clearly, then the court must assess whether the agency acted reasonably when it used its discretionary authority to issue the regulation. It is worth quoting the Supreme Court’s opinion here at length: “While agencies are not directly accountable to the people, the Chief Executive is, and it is entirely appropriate for this political branch of the Government to make such policy choices — resolving the competing interests which Congress itself either inadvertently did not resolve, or intentionally left to be resolved by the agency charged with the administration of the statute in light of everyday realities.”

The Chevron decision actually allowed a Reagan administration regulation to stay in place, which made it easier for industrial facilities to comply with EPA regulations. Despite this, in the 40 years since it was issued, opponents of regulation have grown to oppose the “Chevron-two-step.” That opposition has culminated in two cases heard by the Supreme Court in January, Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce. Decisions in both cases will come this spring.

The two cases could lead to the overturning of Chevron v. NRDC. Supporters of Chevron’s demise have argued that doing away with the ruling will give Congress the incentive to write more detailed statutes in the regulatory arena. The current dysfunctional state of Congress makes that claim extremely dubious in the present moment. But even in eras when Congress was more functional, it never had the technical expertise to fully understand and weigh the tradeoffs of, for example, setting an emission standard at 5 parts per million vs. 10 parts per million. Executive branch agencies do have that expertise.

And as the recent Biden administration decision shows, those agencies are still very much influenced by a politically accountable president.

Stuart Shapiro is the Dean of the Bloustein School of Planning and Public Policy at Rutgers University, and a member of the Scholars Strategy Network. Follow him on Twitter @shapiro_stuart.

The Hill, March 15, 2024

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