Supreme Court Signals It Backs Trump’s Firing of Agency Leaders

The US Supreme Court signaled it’s poised to give the president control over potentially dozens of traditionally independent federal agencies as the court’s dominant conservative wing cast doubt on a 90-year-old precedent.

Hearing arguments in Washington Monday, the justices suggested they will let President Donald Trump permanently remove Rebecca Kelly Slaughter from the Federal Trade Commission despite a law that says commissioners can be fired only for specified reasons. Slaughter’s ouster would leave the consumer-protection agency without any Democratic commissioners.

Regulation opponents are seeking to achieve a long-sought goal by toppling the 1935 Humphrey’s Executor ruling. That decision upheld the FTC job protections and cleared the way for the independent agencies that came to proliferate across the federal government. Reversing Humphrey’s Executor would affect government bodies that oversee labor relations, consumer product safety, transportation safety and employment discrimination.

The court’s liberals blasted that prospect. Justice Elena Kagan said the Trump administration’s position would mean “massive, uncontrolled, unchecked power in the hands of the president.”

But the court’s six conservatives said the real concern was Congress’ creation of agencies that exercise executive power but aren’t accountable to the president. “Tomorrow we could have the Labor Commission, the Education Commission, the Environmental Commission, rather than Departments of Interior and so forth,” Justice Neil Gorsuch said.

Although a far-reaching ruling could undercut the independence of the Federal Reserve, conservative Justice Brett Kavanaugh indicated he would reinforce a carveout the court seemed to create for the central bank in May. Kavanaugh said Monday he has “concerns” about undermining the Fed’s independence.

The court next month will consider Trump’s bid to circumvent that shield by firing Fed Governor Lisa Cook for alleged mortgage fraud. Cook denies the allegations.

Critics say Humphrey’s Executor undermines the separation of powers by leaving powerful executive branch officials unaccountable to the president. Defenders say the Constitution gives Congress the flexibility to create agencies that rely on expert leadership and are insulated from political pressures.

The Supreme Court’s conservative majority has chipped away at Humphrey’s Executor in recent years.

(Updates with excerpts from argument starting in fourth paragraph.)

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Greg Stohr in Washington at gstohr@bloomberg.net

To contact the editors responsible for this story:
Elizabeth Wasserman at ewasserman2@bloomberg.net

Steve Stroth

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