The Law & Economy Spectator

Rex Quondam, Rex Futurus

A new constitution for a 21st century empire.

By From the October 2012 issue

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OVER THE LAST 250 YEARS there have been four American constitutions, each giving us a very different form of government. The first constitution was that of the pre-Revolution Crown colonies, under which royal governors dominated the elected assemblies. These were swept aside by the American Revolution, and (after the interregnum of the Articles of Confederation) the Framers, at their convention in the summer of 1787, produced the second constitution, one of congressional government, with power centered in the Senate and House of Representatives. The seeds of the third constitution were found in the second constitution and emerged over the Republic’s first 50 years, as the president became popularly elected and his office emerged in the form of the modern executive: commanding, decisive, and possessing all the authority of the only person elected by the nation at large.

With Obama, we have now entered into a fourth constitution, one of strong presidential government, in which the president has slipped off many of the constraints of the third constitution’s separation of powers. He makes and unmakes laws without the consent of Congress and spends billions to reward his friends. His power exceeds that of any American ruler since the Revolution. He is rex quondam, rex futurus—the once and future king.

The election next month is a choice between two very different ideas about the role of the state, between free markets and crony capitalism, between fiscal prudence and financial profligacy, between a forceful foreign policy and a fainéant one. It is also a referendum on which constitution is to govern us, and what we decide will determine what kind of country we will have for many decades to come.

The President’s Legislative Powers

ARTICLE I, SECTION 1 OF THE CONSTITUTION bars presidential law-making by specifying that “[a]ll legislative Powers herein granted shall be vested in a Congress of the United States.” Nevertheless, Congress has quietly acquiesced to the expansion of presidential power through a succession of laws which, drafted in the broadest terms, delegate the details of their implementation to the executive branch, which can be seen as a grant of legislative powers to the president.

The Dodd-Frank financial regulation statute provides a striking example of this abdication. The act created two new federal agencies, the Financial Stability Oversight Council and the Consumer Financial Protection Bureau, each with enormous and ill-defined discretion over a large sector of the American economy. The CFPB is empowered to proscribe “unfair, deceptive or abusive” consumer loans and “predatory” lending, open-ended standards that place little discernible limits on the regulators. The CFPB is also immunized from Congress’s power of the purse, because the agency has a claim to more than $400 million from the Federal Reserve each year and because Congress is prohibited from reviewing that budget. Just what these agencies will do depends on who is appointed to run them, and that decision lies with the president.

The controversy over the CFPB was heightened by the manner in which it got off the ground. The agency could not begin its work until its director was appointed. This would have required Senate confirmation, however, and Republicans filibustered the appointment. To get around this, Obama made a “recess” appointment of Richard Cordray in January 2012, at a time when the Senate, according to its rules, was not in recess. Instead, it was in a “pro forma” session, which means that senators appear periodically for a few minutes to bang the gavel. Before 2012, this tactic had worked for five years to prevent two administrations from making an appointment without Senate confirmation, and Cordray’s recess appointment was therefore a precedent-setting expansion of executive power.

The courts have been complicit in the grant of presidential legislative powers, by stripping Article I, Section 1 of any discernible content. The section should prevent Congress from delegating legislative powers to the president, but this non-delegation doctrine was last heard when the Supreme Court struck down the National Recovery Act in 1935. It is unlikely to fetter future presidents.

The President’s Non-Reviewable Veto Power

THE CONSTITUTION gives the president the power to veto any bill, subject to a two-thirds override by both houses of Congress. In recent years, however, presidents have enjoyed an expanded, non-reviewable veto power. They might simply decide not to enforce a law.

Presidents have frequently issued signing statements in which, without vetoing a bill, they declare that they do not consider themselves bound by some of its provisions. In the past, however, they have always asserted a constitutional basis for doing so, and this was not a shocking exercise of executive power. Were Congress to pass a law abridging the right to practice one’s religion, for example, no one would expect the president to enforce it while waiting for the Supreme Court to strike it down.

Obama has now expanded the non-reviewable veto power in two ways. First, he has announced that he won’t defend laws passed by prior Congresses. In 1996, Congress enacted the Defense of Marriage Act, which defines marriage, for federal purposes, as being between a man and a woman. The act was passed by large majorities in both houses of Congress and signed into law by Bill Clinton. In 2011 Obama’s Department of Justice announced that it regarded the law as unconstitutional and would no longer defend it in court. Because DOMA is the subject of ongoing lawsuits, this comes down to an effort to veto a law which Obama lacks the votes in Congress to repeal.

Second, Obama has asserted the right not to enforce laws that are constitutionally unobjectionable, simply as a matter of prosecutorial discretion. Congress refused to pass Obama’s DREAM Act, which would have given conditional permanent residency to some illegal immigrants, and so he issued an executive order that they not be deported. The new program of formalized “Deferred Action for Childhood Arrivals” could allow an estimated 1. 7 million young undocumented immigrants to live and work in the United States

Most recently, the administration released a policy directive that allows states to receive a waiver for the work requirements that were at the heart of the 1996 welfare reform law, passed after a lengthy debate over how to get people off welfare. The act’s authors foresaw the possibility that subsequent administrations might seek to gut its workfare requirements, and they therefore made them non-waivable. Administration officials say only waivers that improve outcomes will be approved, and Utah’s GOP governor has defended his state’s request for one. That said, whatever one thinks of waivers, they mark a remarkable assertion of presidential power. The non-reviewable veto trenched on both the spirit and the letter of the major legislative initiative of the Clinton presidency.

The executive obviously possesses a degree of discretion in the manner in which it enforces laws, but if this permits a president to disregard them in the face of congressional opposition, one might reasonably ask whether any limits can be set to the nonreviewable veto power. The president’s assertion that he can decide not to enforce a properly enacted and constitutionally unassailable statute violates both the vesting power of Article I, Section 1, and the presidential veto power of Article I, Section 7. (Why veto a bill, and risk an override by Congress, if a president can simply decide not to enforce it?) It also violates Article II, Section 3 of the Constitution, which enjoins the president to “take Care that the Laws be faithfully executed,” to say nothing of the separation of powers itself. As such, the non-reviewable veto is constitutionally suspect, but if this is a breach, it is one without a legal remedy, since there is no sanction for failing to enforce a law short of an exceedingly improbable impeachment. Only a political remedy exists, in the requirement of a referendum on the administration in a popular election.

The President’s Spending Power

THE PRINCIPLE that taxing and spending authority is vested in the legislature was one of Parliament’s hard-won victories in 17th-century English constitutional history. In recent years, however, the power of the purse has passed to the president, particularly under the 2009 stimulus package, which appropriated $787 billion and was the source for the ill-fated $500 million Solyndra loan guarantee. The Solyndra guarantee was not made out of the blue, but only after frequent meetings between Solyndra executives and White House officials, who touted the project as an example of the president’s support for green energy.

The 2009 GM-Chrysler bailout was an especially remarkable example of the presidential spending power. More than $80 billion in TARP funds was used to bail out the two car manufacturers, even though this unconstitutionally contravened the appropriation statute. Congress had authorized that the TARP monies be spent on “financial institutions” such as banks, savings and loan associations, credit unions, and insurance companies—not on car companies. Bush had sought approval for the automobile bailout from Congress but had failed to overcome a Senate filibuster

The New Monarchists

ONE MIGHT HAVE EXPECTED the media to take notice of the expansion of presidential power under Obama. With far less cause, they were quick to decry the “imperial presidency” of George W. Bush. Now, however, the earnest republicans in the media and the Democrats have discovered the joys of monarchism. They move seamlessly from the party to the media (George Stephanopoulos, Chris Matthews), from the White House to a lucrative consultancy job (David Axelrod), from the Justice Department to a $4-million-a-year job at Fannie Mae (Jamie Gorelick). They are the pampered fops at the feet of the king, presidential courtiers who will not have to wait for the next world to see their loyalty rewarded. Their motto is “We look after our own!” 

For the monarch’s loyal subjects: power, preferment, privilege; for the misguided and disloyal subjects: the full force of the law. We have given you Chevy Volts, and you persist in driving Ford Explorers? Very well, our EPA will mandate fuel-efficiency standards to take away the keys to your gas guzzlers. Your every thought and word reveals deep-seated racism? Very well, we will audit you and sue you and subject you to all the scorn that the media can direct your way. Lèse-majesté has no place under the fourth American constitution, any more than it did under the first.

And what of Congress? Its inspectors general have been taught not to make waves, lest they be fired in the humiliating manner that Gerald Walpin was dismissed when he questioned payoffs to the president’s cronies. Congressmen still control the purse strings, but in a showdown with the president can be expected to blink. They do serve one purpose, however. Without them, how could we have a State of the Union Address?

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About the Author

F.H. Buckley is Foundation Professor at the George Mason University School of Law.