In Biden v. Nebraska, the Supreme Court ruled that President Biden’s student-debt cancellation plan was an impermissible interpretation of a provision in the post–9/11 HEROES Act that allows the secretary of education to “waive or modify” loan terms in certain emergencies. In finding the secretary’s interpretation of that limiting language too much of a stretch, the Court recognized that executive-branch officials can only enforce duly enacted congressional legislation rather than taking action that goes beyond those parameters to make new law. Chief Justice John Roberts’s majority opinion also cited a backup argument, known as the “major questions doctrine”—holding that the Court will not assume that Congress has, without explicitly saying so, delegated the power to regulate significant economic or social matters.

Lurking in the background of Biden v. Nebraska are two key issues in administrative law: the nondelegation doctrine—the foundational claim that Congress can’t relinquish its own lawmaking power—and questions of judicial deference to agencies. The nondelegation doctrine currently lacks meaningful definition, and Congress does delegate vast authority to executive and independent agencies. Meantime, deference doctrines have grown to such an extent that courts broadly yield to agency interpretations of their own operative statutes (established in the 1984 Chevron case), as well as agency reinterpretations of their existing regulations (the 1997 Auer case, as circumscribed by the 2019 Kisor case).

Under these conditions, the executive branch—as well as whatever branch “independent agencies” inhabit—tends to usurp both legislative and judicial authority, weakening the separation of powers. The major questions doctrine arose in the last decade as a kind of makeshift “hydraulic” force—as Justice Neil Gorsuch put it in dissenting in the 2019 Gundy case, in which the Court declined to find an inappropriate legislative delegation regarding the federal sex-offender registry—to circumscribe executive overreach.

Consider a new Competitive Enterprise Institute report that provides a timely overview of these issues. Its authors, Dan Greenberg and Devin Watkins, note that agencies “investigate and prosecute,” “issue rules with the force of law,” and “conduct hearings, trials, and appeals”—executive, legislative, and judicial functions, respectively. Such agencies as the Federal Trade Commission are often accountable only to themselves: an FTC investigation is adjudicated by FTC administrative-law judges and appealed to FTC commissioners. And agencies act on “relatively broad and vague statutes” from Congress that authorize them to “plug the legislative gaps that Congress has left open.” Hence, Greenberg and Watkins aim to “divest non-executive powers from federal agencies” and “banish the specter of unlimited government.”

The report makes two proposals for judicial and legislative reform. First, Greenberg and Watkins propose that Congress “end all relevant funding for all binding adjudicators and quasi-judicial bodies housed in executive and independent agencies” and create a new system of magistrates with the same function as current administrative courts, whose rulings would then be appealable to existing federal circuit courts. Second, they propose that Congress stop using appropriation riders and instead “provide funding for two new congressional committees” to produce “supplementary legislation” that would be responsible for much of what agency rulemaking does now: elaborating and explaining gaps in the law.

The process of passing supplementary legislation would be somewhat complex. But the upshot is that in the process of congressional sausage-making, the majority and minority parties would offer their own proposals, with a failsafe presidential-choice provision. The primary incentive is congressional action: each house would be motivated to pass a consensus proposal.

The judicial reform would be a bold and necessary move. In the last two decades, repeated court rulings have revealed significant weaknesses in the legitimacy of agency structures, particularly in how they adjudicate cases. Replacing administrative-law judges with federal magistrates would indeed rebalance federal power.

Such measures would solve many of the battles over deference doctrines and nondelegation. Agencies would receive room to undertake their traditional functions in line with Justice Gorsuch’s Gundy dissent, which Chief Justice Roberts and Justice Clarence Thomas joined. The Supreme Court has long held that Congress can, on subjects “of less interest,” delegate “power . . . to fill up the details” as long as Congress sets standards “sufficiently definite and precise” to enable the other branches and the people to know “whether Congress’s guidance has been followed.” Congressional delegations are permissible only if the power delegated is “already within the scope of executive power”—for example, prosecutorial discretion. Thus, the Gundy dissenters would be fine with executive or independent agencies’ doing some of the work Greenberg and Watkins would give to their new committees, so long as the agencies’ functions are limited and within the scope of Congress’s “relevant policy decisions.” But that would all depend on a robust nondelegation doctrine and curtailed Chevron deference.

The Court takes up many of these issues next term. In SEC v. Jarkesy, it will consider a delegation problem regarding agency adjudication. The Court is likely to reconsider the nondelegation doctrine as the Gundy dissenters suggested, this time joined by Justices Samuel Alito (who expressed a willingness to do so outside Gundy’s “freakish” facts) and Amy Coney Barrett. In Loper Bright Enterprises v. Raimondo, the Court will consider whether to overrule Chevron. And in Consumer Financial Protection Bureau v. Consumer Financial Services Association, the Court will consider whether the CFPB’s funding, which comes directly from the Federal Reserve rather than as allocated by Congress, violates the Constitution’s Appropriations Clause.

If you liked the student-loan ruling, stay tuned for what should be an exciting year for pushing back on hitherto-unchecked agency power.

Photo by Kevin Dietsch/Getty Images


City Journal is a publication of the Manhattan Institute for Policy Research (MI), a leading free-market think tank. Are you interested in supporting the magazine? As a 501(c)(3) nonprofit, donations in support of MI and City Journal are fully tax-deductible as provided by law (EIN #13-2912529).

Further Reading

Up Next