Today’s News in the Administrative State

Today may go down in history as one of the crucial turning points in the reversal of the Administrative State. The Supreme Court is hearing Oil States Energy v. Greene’s Energy, where the issue of whether administrative law judges beholden to executive agencies, rather than bona fide Article III judges and juries at trial, can decide whether or not patent property rights deserve protection. The Wall Street Journal editorial page has a nice review and summary of the case if you are a subscriber. If not, take our word for it. I have a busy day so I doubt I’ll be able to listen in to the oral argument, but I’ll be checking the news reports to see what sense people have of how it goes.

Meanwhile, across town in DC there is a showdown over who actually runs the Consumer Financial Protection Bureau (CFPB), which the Democrats set up to be so autonomous that it doesn’t even have to get an appropriation from Congress to operate: it sets its own budget and requisitions operating funds from the Federal Reserve—a constitutional violation so easy and clear to make out that even a first grader could spot it. Trump has appointed Nick Mulvaney to be the acting director, as the CFPB statute Vacancies Reform Act (but also basic constitutional logic) indicates is his right to do, but outgoing CFPB chair Richard Cordray attempted to appoint his own successor.

And so today at CFPB we have two acting directors vying for control of the agency, in circumstances that sound similar (though not identical) to the case of Luther v. Borden, the 1849 controversy that involved competing claims in Rhode Island as to which governor and legislature had been properly elected. In 1849 the Supreme Court decided not to intervene, leaving it up to Rhode Island to sort out its mess (which, by the looks of things there, they never did). The courts can’t punt the CFPB matter—either the president wins, or the permanent bureaucracy wins.

In any case, the scene today at CFPB may look something like this:

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