Thanks for joining this episode of the No.
86 lecture series, where we discuss Administrative Law, including the history of the administrative
state and modern debates about its powers. Today’s episode features Christopher J.
Walker, who is a Professor of Law at the University of Michigan Law School. As always, the Federalist Society takes no
position on particular legal or public policy issues; all expressions of opinion are those
of the speaker. In this episode, I want to focus on the relationship
between federal courts and administrative agencies. When do courts review agency actions? The second half of the Administrative Procedure
Act deals with judicial review. In other words, the Administrative Procedure
Act sets the default rules for how federal courts should review agency actions. So the agency acts, there's a final agency
action, and the Administrative Procedure Act then says that in almost all circumstances,
if you're not happy with what the agency did to you, you can go to federal court and seek
review. Federal courts don't re-review everything
federal agencies do. It's not as if they get to rejudge what happened
in an immigration court. Instead, what the Administrative Procedure
Act does, is it provides for a very agency friendly, deferential review of those agency
actions. For instance, the Administrative Procedure
Act says, defer to the agency so long as they didn't act arbitrarily, or didn't abuse its
discretion. It doesn't allow, in most circumstances, for
the court to reweigh evidence, to hear witnesses or the like. Instead, it's reviewing the administrative
record and reviewing it for reasonableness with a very heavy deferential standard. And that's an important compromise that was
reached in the Administrative Procedure Act. When you think of judicial review of agency
actions, it's helpful to divide the world of judicial review into kind of two separate
buckets. On the one hand, courts review how agencies
interpret statutes that govern the agency. Those are review of legal questions. On the other hand, courts also review how
agencies act. The factual findings they make. The policy decisions they make. These are two different types of judicial
review. The reason why we distinguish between questions
of law and everything else agencies do when we think about judicial review, gets us back
to Marbury vs. Madison. The case where Chief Justice Marshall said
that it is the emphatic duty of the courts, of this court, to say what the law is. In other words, when we usually think about
interpreting laws, the primary interpreter is the court. Not the agency, not the president, not congress,
not the public. Courts really should play that primary role
in interpreting saying what the law is. And so, when we're thinking about how to review
agency actions, or any action for that matter, we might view factual determinations, policy
judgements, in one category. But, when it comes to the law it plays a special
role for courts to be the ultimate adjudicator of what the law means. What is the Chevron doctrine and where did
it come from? The Chevron doctrine commands courts to defer
to agency interpretations of statues that they administer, so long as they're reasonable. In other words, courts do not decide what
the meaning of the statutes are, if agencies have the authority to implement that statute. Instead courts have to defer. This Chevron deference doctrine is a bedrock
principle of administrative law, and it comes from a decision during the Reagan administration,
in 1984. There the environmental protection agency,
under president Reagan, was trying to deregulate. They were trying to make it easier for businesses
to grow and develop The NRDC opposed this move by the Reagan EPA,
because it would not be as stringent in enforcing environmental protections. The case made it all the way up to the Supreme
Court, and the question was, can an agency just change its position on a question of
law with the definition of stationary sources under the clean air act? Or is it stuck with that position that the
prior administration made? At the time, I don't think that the Supreme
Court thought it was doing anything remarkable. Justice Stevens, writing the opinion for the
Court, said that an agency can change its position, so long as the statute is ambiguous,
and the agency's interpretation is reasonable. Now importantly, what the court said was,
it is not our duty or responsibility to provide the best interpretation of the statute. We might not agree with the agency that this
is the best interpretation of the statute, so long as it is reasonable, the agency wins. And that started, or clarified a deference
doctrine that has controlled for the last three decades, how federal courts review agency
actions. One reason why we have a law fact distinction
in judicial review, why courts review more searching legal questions than factual questions
is one of comparative expertise. A court is the expert on saying what the law
is. Whereas, they're not the experts, especially
appellate courts on determining facts, or making policy judgements. And so, we structure judicial review in a
way that a court is reviewing de novo, or saying what the law is. And yet, it's deferring to fact finders to
trial courts, to juries, to federal agencies, to presidents, on what factual and policy
determinations is. In administrative law, that actually still
isn't the case. In administrative law, there's deference doctrines
even with respect to factual questions. And that brings us to one of the law hottest
debated questions in administrative law today of Chevron deference, the level of deference
the court should give to agency interpretations of statutes. Does Chevron deference really matter? Does it significantly impact court rulings
in favor of agencies or is that exaggerated? I think it's a mistake to say that Chevron
deference doesn't matter. For kind of two different reasons. First, the vast majority of agency rules never
make it to the Supreme Court. They're reviewed by the lower courts. By the courts of appeals, and often times
by the district courts. And at that level, Chevron deference matters. Kent Barnett and Christy Boyd, at the university
of Georgia, and I, have spent the last several years reviewing 11 years of published circuit
decisions, over 1,500 decisions in the federal courts of appeals that involve Chevron deference. And our findings have shown the Chevron has
a tremendous effect on whether an agency wins before a lower court. In fact, there's a 25 percentage point, in
fact, there's a 25 percentage point different between agency win rates when the court decides
to apply Chevron and when they don't. So, it's a mistake to argue it doesn't matter. On another level though, beneath the surface,
it affects how agencies act, and how parties litigate. I've spent time surveying agency officials
at 11 different agencies, asking them about how they draft regulations and interpret statutes. And the tool that most, the biggest winner
of the study, the tool that most agency officials said they use, is Chevron deference. And when I asked more about why, how do they
use it. Their suggestion, the federal agencies are
more aggressive when they know they're going to get Chevron deference than when they're
not. That they're going to advance interpretations
of statutes that are not as conservative, that are not as faithful to their statutory
mandates, when they know that they have a better chance of winning in court. So, if we were to get rid of Chevron deference,
or narrow Chevron deference, agencies are going to lose more in court, but more importantly,
agencies are then going to adjust how they approach their statutory obligations, and
be more faithful to their statutory mandates. Are there constitutional issues with Chevron
deference? In recent years, Chevron deference has come
under attack by academics, by judges, and on the Hill. For instance, pending in congress is the separation
of powers restoration act. Which would eliminate Chevron deference, and
tell courts they need to review De Novo, without any deference agency interpretations of law. You also see a number of federal judges criticizing
Chevron deference. Most notably Justice Gorsuch at his confirmation
hearing, Chevron deference was front and center. Because as a judge on the 10th Circuit court
of appeals, had raised constitutional concerns about Chevron. Justice Thomas has raised constitutional concerns
about Chevron. And most recently Justice Kennedy has raised
constitutional concerns about Chevron. So, what are these constitutional concerns? What's going on? What's wrong with Chevron? Why should we get rid of it? I think before we get to the constitutional
concerns, we should return to the Administrative Procedure Act. The Administrative Procedure Act commands
courts to determine questions of law and the constitution. There's nothing in the Administrative Procedure
Act itself, in the text, that says the court should refer to agencies. Now, there's historical debates about whether
deference doctrines were codified, backdrop principles of common law were codified. But, the text itself doesn't say anything
about deference. And that's an important fact when we're determining
what to do with a deference doctrine. Now, when we're looking at the constitutional
concerns, they kind of come in two main flavors. The first is that there's an article three
concerns under the constitutional Chevron deference. As Justice Thomas has explained, under Marbury
vs. Madison, it's the duty of courts to say what the law is. Chevron deference by contrast says that it's
the agency's primary authority to say what the law is. In other words, even if the court thinks an
agency's interpretation is the not the best interpretation, the right interpretation of
a statute. The court still has to defer, so long as it's
reasonable. So, that could raise some article three judicial
concerns about Chevron. The other types of concerns that Justice Gorsuch
has explored, are the article one concerns. The non delegation concerns. In other words, Chevron deference may encourage
congress to delegate too much lawmaking power to federal agencies. And that creates problems of non delegation,
because congress isn't playing it's proper role to legislate. And agencies are playing too much of a role. And so, when you combine these two constitutional
concerns, with the fact that Administrative Procedure Act says nothing about deference,
Chevron deference, you might have an opportunity here to eliminate to doctrine. Is it realistic to get rid of Chevron deference? Are there any alternative doctrines that could
replace it or improve it? If we're going to reform the Chevron doctrine,
how do you do it? Obviously, the easiest answer would be just
to get rid of it. Actually, it's not that easy. There are lots of complications of what will
remain if Chevron disappears. Whether there will still be some type of deference
or not. But, putting that aside, we're not going to
get rid of Chevron deference, what else can we do? Once thing that we can do is something, one
way that we can narrow Chevron deference is by adjusting when it applies. One way that the court has done this in recent
years is the major questions doctrine. The major question doctrine, featured most
prominently in a case called King v. Burwell, which was a statutory challenge to the affordable
care act. There were numerous plausible arguments that
the statute was ambiguous. And therefore, it should've gotten Chevron
deference, and the agency should've won. But, Chief Justice Roberts writing for the
court refused to apply Chevron deference. Instead, he invoked the major questions doctrine. And what he said is that when a statutory
ambiguity implicates a major question, a question of significant political or economic important. Here, billions of dollars in a market, we're
not going to assume that congress intended for the agency to answer that question. Another way is to provide for more search
and review of what we call Chevron step one. The question of whether the statute is ambiguous. This was Justice Scalia's approach for a narrow
Chevron. . .For Justice Scalia, he seldom ever reached
Chevron step two. He almost always found the statute unambiguous. Found no discretion of the agency, because
the statute was clear. Most federal judges, however, are much more
willing to find statues ambiguous. And so, one way to limit that is to require
a more heightened intellectualist inquiry at step one. Another way to limit Chevron deference is
to have a more invigorated step two of Chevron. So now, step two of Chevron is the reason
most inquiry. After we determine that a statute is ambiguous,
the court then proceeds to ask is the agency's interpretation of the statute reasonable? In recent years, the Supreme Court has grafted
onto this reasonable requirement, both the substantive reasonable requirement and a procedural
reasonable requirement. So, you see now the Supreme Court, for instance,
in a case by Justice Kennedy and Encino Motor Cars, saying, if the agency changes its position,
it better provide good reasons or it's not going to get Chevron deference. Or if the agency doesn't follow the right
procedures, even if substantially it's a reasonably decision, we're not going to give it Chevron
deference, because they didn't follow the right procedures. So, when you're thinking about how to reform
Chevron deference, short of actually getting rid of it, you have three main options. One, you make it harder for it to apply, by
taking a closer look at whether the court thinks that type of ambiguity is one that
congress meant to delegate to the agency. Two, you don't find ambiguities as often. You use all the tool of statutory interpretation
to figure out what the right answer is. And three, if you do find an ambiguity, the
court does a more search and review of both the process and the substance, to figure out
whether it was reasonable, and whether it complied with the law. Are there any benefits to courts using Chevron
deference? One of the main benefits of Chevron deference
is that it removes politics from judicial decision making. In other words, the Chevron court itself recognized
this political accountability rationale for Chevron, and said, "You know what, agencies
are more politically accountable than courts. So, if we're going to have an interpretation,
we should have an agency, whose directed by the president and reports to congress, make
that decision." Having just reviewed 11 years of every published
circuit court decision dealing with Chevron deference, we have found that it has a powerful
constraining role. In other words, judges are much less likely
to vote in favor of an agency interpretation that matches their own political preferences
when Chevron applies, than when it doesn't. And so, when we're thinking about political
accountability, and thinking about what to do with Chevron, if we want to remove politics
from judging, Chevron might be one of our strongest tools. Most of the attacks on Chevron deference are
coming from conservatives, from the right. And yet, the Chevron doctrine itself is a
conservative doctrine. It was born in the Reagan Administration as
a way to help agencies deregulate. In a way to remove agencies from the law making
process. And it was also born in a way to remove politics
from judicial decision making. So that judges don't second guess the political
branches. They defer, if the political branches are
acting reasonably. And these are core principles of judicial
conservatism. Of deference to political branches. Of allowing for elections to matter. For the federal regulatory state to shift,
to deregulate, to be able to move in response to electoral politics. If we care about the administrative states
vast and deep interactions with it on a daily basis, courts are really only a small part
of the answer. If we care about reforming the administrative
state, we have to think a lot more about congress' role in oversight, in the legislating, in
the controlling federal agencies. And also thinking about the president's role
in ensuring that federal agencies act within its proper authority. And so, it's a mistake to think about, or
to focus too much on courts as a safe guard in our constitutional republic. But the rise and rise of the administrative
state, we have to look to the political branches as well to play their proper role. Thank you for listening to this episode of
the No. 86 Lecture series. The spirit of debate of our Founding Fathers
animates all of the No. 86 content, encouraging discussion and critical reflection relative
to how each subject is widely understood and taught in law schools and among law students. Subscribe to the No. 86 Lecture series on
your favorite podcast platform to have each episode delivered the moment it’s released. You can also go to fedsoc.org/no86 for lectures
and videos on Federalism, Separation of Powers, the Judiciary and more. Thanks for listening. See you in class!
