Supreme Court Gives America Big Win Over Federal Regulations

It's about time.

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The conservative majority on the Supreme Court came through on this one. The ruling against EPA sends a message to bureaucrats: Watch your back. The fun is over. Iain Murray of the Competitive Enterprise Institute comments.

Murray: For some time, the Environmental Protection Agency has wanted to destroy the American coal industry and has issued regulations with that end in mind. Today, the Supreme Court said it cannot do that without a clear grant of authority from Congress. This ruling not only stops environmental zealots in the EPA, but it should also stop major power grabs by bureaucrats at other agencies. It’s a landmark ruling against the agencies that have become like a fourth branch of government.

In the June 30 ruling in West Virginia v. EPA, the Court was concerned with an Obama-era regulation called the Clean Power Plan. The EPA felt it had a duty to reduce greenhouse gas emissions and drew up rules that would force states to do so. In the process, the agency decided the “best system of emissions reduction” was one that the coal industry could not survive under. Regulators relied on a little-used provision of the Clean Air Act that had only ever been used to make emission reduction systems operate more cleanly, not to eliminate them. The Court said they couldn’t do this.

As my colleague Sam Kazman, who has been fighting these bureaucrats for almost 40 years, said: “EPA attempted to transform the statute in the same way that it attempted to transform the power-generating industry. The majority slammed it on both counts, noting that Congress had repeatedly rejected similar legislative proposals in the past.”

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The decision has more far-reaching implications than sending the EPA back to the drawing board, however. As the Court said, “this is a major questions case.” What that means is that major questions of public policy can’t be decided by bureaucrats alone. That power is for Congress and Congress alone.

This should send shivers down the spines of officials all over Washington, D.C. For years, they have relied on ever-broader interpretations of old laws to justify their regulatory power. Several major initiatives already look shaky in the wake of this ruling.

The Securities and Exchange Commission, for instance, suddenly says it has the power to compel companies to compile disclosures on the direct and indirect environmental effects of their activities. This is a radical reinterpretation of the Commission’s role, which has always been to protect investors from fraud.

The Federal Communications Commission wants to reimpose “net neutrality” rules on internet service providers, requiring them to treat all internet traffic equally. Whatever you think of the merits of that policy, it is far from clear that the FCC has that authority, and Justice Kavanaugh (in a 2017 case) has already suggested they don’t.

There is also a host of regulators looking to pounce on the crypto industry. Given that all the laws they rely on were written before crypto was even on Congress’ radar screen, their authority to do so must be questionable. The same goes for all sorts of new technology, like drones…

The biggest losers today are power-hungry bureaucrats. No matter how expert they may be on their subject (and it is an open question how expert environmental lawyers are on the subject of electricity generation), they cannot under our constitutional system of government substitute their judgment for the decision of the people’s representatives in Congress. The administration’s ambitious “whole of government” agenda of trying to insert things like climate considerations into unrelated areas like securities law took an almighty hit in the Court’s ruling. The Court put the power back where it belongs, in Congress. We shall see whether Congress is up to the task.

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