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12/09/2021

Richard Epstein and Mario Loyola on Chevron Deference and American Hospital Association v. Becerra
Michael Ramsey

In the Wall Street Journal, Ricahrd Epstein and Mario Loyola: The Supreme Court’s Chance to Rein In the Regulatory State (discussing American Hospital Association v. Becerra, argued 11/30/21).  From the introduction: 

The Supreme Court heard oral argument last week in a technical case that could have major implications for American government. American Hospital Association v. Becerra involves Medicare drug reimbursement schedules to hospitals. It presents the Court with an opportunity to revisit its landmark 1984 decision in Chevron v. Natural Resources Defense Council, a major milestone in the rise of the administrative state. Chevron ushered in a perilous era of judicial deference to agency interpretations of laws deemed “ambiguous,” often by judges who think that no text is clear.

And from later on:

The Constitution gives federal courts the power to interpret federal statutes. This principle, which is vital for ensuring that Congress and the executive branch comply with the law, is confirmed by the 1946 Administrative Procedure Act, which explicitly provides in Section 706 that in reviewing an agency’s action, courts “shall decide all relevant questions of law” and “interpret constitutional and statutory provisions” de novo—from scratch.

The court in Chevron never cited Section 706. Instead, it invented out of whole cloth a “two-step” rule for reviewing agency interpretations of law: First, courts are to give effect to the “unambiguously expressed intent of Congress.” Second, if a court finds that the statute is ambiguous, as courts too frequently do, then it is bound to respect any plausible agency interpretation.

In conclusion: 

Agencies aren’t impartial participants in these cases but have an interest in interpreting the law in ways that expand their powers. Last week Justice Gorsuch sounded exasperated by yet another example of the “government’s seeking deference for a rule that advantages it.” He seemed sympathetic to Justice Amy Coney Barrett’s observation that AHA presented a “classical problem of statutory interpretation that a court should resolve” without judicial deference. Justices Clarence Thomas and Samuel Alito both bluntly asked if Chevron should be overruled.

Chipping away at Chevron won’t by itself solve the larger problem in the rise of the administrative state, which as James Madison warned, is that “the accumulation of all powers, legislative, executive, and judiciary, in the same hands . . . may justly be pronounced the very definition of tyranny.” But curbing abuses in agency rulemaking by returning to the Administrative Procedure Act would be a good start.

Perhaps it is Chevron, not Roe v. Wade, that is in greater danger of being overruled.