Rudimentary U.S. civics courses teach that the federal government has three branches: executive, legislative, and judicial. Each possesses a distinct power set. In Article III, the Constitution vests in the courts the bulk of judiciary authority. These fundamental facts of America’s constitutional order were just affirmed by the Supreme Court in the cases Axon Enterprise, Inc., v. Federal Trade Commission.
The Supreme Court ruled unanimously this month that Article III courts — not executive agencies’ administrative law judges (ALJs) — have jurisdiction to review constitutional challenges raised against the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC). The notion that agency bureaucrats have the expertise or authority to determine the constitutionality of their own entities is a dangerous precedent. Thankfully, the Supreme Court rejected this absurdity in their ruling.
Respondents Axon Enterprise, Inc., a police-equipment manufacturer, and Michelle Cochran, a certified public accountant, were targeted by the FTC and SEC, respectively. The FTC and SEC regularly use ALJs, who function somewhat like district court judges. Their rulings are subject to review by their respective commissions. Only after the completion of these protracted and costly proceedings can the accused seek relief in a federal appeals court. The respondents sought to avoid such proceedings by filing suits in federal courts, each disputing the constitutionality of the ALJ system itself.
Though the Axon decision marks another successful skirmish between the increasingly textualist Supreme Court and the bloated, extraconstitutional administrative state, the more significant battle will occur when judges litigate the Axon and Cochran cases on the merits. They have won the case on structure but still have a battle ahead against the respective agencies.
In anticipation, Justice Clarence Thomas’ concurring opinion provides a legal and philosophical foundation from which to curtail ALJs’ authority.
Transferring the judiciary’s core authority to executive agencies by divesting it of original jurisdiction is likely unconstitutional, Thomas writes. Further, this “may violate the separation of powers by placing adjudicatory authority over core private rights—a judicial rather than executive power—within the authority of Article II agencies,” even though the judiciary retains the authority to review agencies’ actions on appeal. As Article III itself acknowledges, fact-finding is a core element of judicial power.
Thomas distinguishes cases that involve private rights — encompassing the individual’s rights to life, liberty, and property — from those that involve public ones — rights possessed by society at large. As a matter of history and constitutional law, Article III judges must have jurisdiction when the government seeks to deprive a citizen of a private right, he posits.
According to Thomas, the agencies’ actions against Axon and Cochran clearly implicate the respondents’ private right to property. Therefore, he concludes, “they likely must be adjudicated by Article III courts and juries.” Should a future Supreme Court majority adopt this position, the ALJ system would be fundamentally compromised — and rightly so. (RELATED: The Proposed New Fuel Economy Standards: Quintessentially Bidenesque)
“This mixed system—primary adjudication by an executive agency subject to only limited Article III review—is unlike the system that prevailed for the first century of our Nation’s existence,” Thomas writes. This changed during the Progressive and New Deal eras, when enterprising lawmakers shaved down the judicial branch’s jurisdiction to insulate their regulatory proposals from judicial review. The FTC Act of 1914 and the Securities Exchange Act of 1934 were two such measures.
Indeed, the desire to free bureaucrats from democratic constraints in large part defines progressivism. Politicians like Woodrow Wilson chafed at democracy’s inefficiencies and the counter-majoritarianism of constitutional checks and balances. Instead, they sought to concentrate power in small platoons of disinterested experts, largely unbounded from oversight and accountability.
Progressives’ “rule by unaccountable expert” is certainly more efficient than democratic republicanism. As Justice Neil Gorsuch notes in his concurrence with the judgement, “From 2010 to 2015, the SEC won 90% of its contested in-house proceedings compared to 69% of the cases it brought in federal court,” and the FTC has had similar success.
Yet the framers knew that procedural efficiency for its own sake often facilitates bad governance. Thus, they eschewed both unfettered democracy and an all-powerful executive, seeking instead to safeguard individual liberty. Separation of powers, federalism, and post-constitutional procedural mechanisms such as the Senate’s filibuster disrupt the tyrannical ambitions of any majority, coalition, or individual.
“If men were angels, no government would be necessary,” James Madison famously wrote in The Federalist No. 51. Less often quoted is the Virginian’s next sentence: “If angels were to govern men, neither external nor internal controls on government would be necessary.” Given that no angels exist amongst men, the need for well-structured constitutions persists.
Lawmakers and bureaucrats shouldn’t lay ruin to Madison’s handiwork for political expediency. Neither should judges. If Axon or Cochran return on appeal to the Supreme Court for adjudication on the merits, the justices should take Thomas’ lead and protect America’s well-balanced constitutional order.
David B. McGarry is a policy analyst at the Taxpayers Protection Alliance.
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