Steven Pearlstein
Steven Pearlstein
Columnist

The judicial jihad against the regulatory state

A favorite pastime of the business community these days is to complain about how dysfunctional Washington has become. They’re right about the dysfunction, of course, but they have nobody to blame but themselves.

After shoveling a billion dollars in campaign cash to elect politicians who pledge never to compromise on anything, business leaders are now shocked — shocked, I tell you — to discover that partisan gridlock once again threatens to send the government off yet another fiscal cliff.

Steven Pearlstein is a Pulitzer Prize-winning business and economics columnist at The Washington Post.

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And then there’s the business community’s penchant for whining about “regulatory uncertainty” while spending tens of millions more to mount legal challenges to every new regulation, appealing all the way to the Supreme Court if necessary.

The dirty little secret is that dysfunctional government has become the strategic goal of the radical fringe that has taken over the Republican party. After all, a government that can’t accomplish anything is a government that nobody will like, nobody will pay for and nobody will want to work for. For tea party conservatives, what could be better than that?

Nowhere has this strategy been pursued with more fervor, or more success, than the U.S. Court of Appeals for the District of Columbia Circuit, where a new breed of activist judges are waging a determined and largely successful war on federal regulatory agencies.

Their latest salvo came just before Labor Day, when a divided three-judge panel threw out rules requiring states to control the air pollution that wafts over their borders into other states. These rules were first ordered up by Congress back in 1970, have been more than 20 years in the making and had already been the subject of two challenges before the D.C. Circuit.

According to estimates by the Environmental Protection Agency, these regulations would prevent between 13,000 and 34,000 premature deaths, 15,000 non-fatal heart attacks, 19,000 hospital and emergency room visits and 1.8 million days of missed work or school for each year. The projected annual compliance cost is $2.4 billion, compared with the annual health benefits of anywhere from $120 billion to $280 billion.

But in reading the 60-page opinion by Judge Brett Kavanaugh, you’d have no clue of this historical, political, economic or health context.

You’d have no idea that hundreds of dedicated, highly trained scientists, analysts and statisticians at the EPA might have spent more than a decade devoted to the extremely complex task of figuring out how much of the ozone or sulfur dioxide in the air in Rhode Island originated in Indiana.

You’d have no idea that legions of government lawyers and economists might have spent a decade listening to, and negotiating with, state officials, industry groups and environmental advocates on an equitable formula for reducing pollution in the least costly way.

You’d have no idea that, in earlier decisions, the same court had found it a reasonable formula resulting in reasonable compliance costs, but sent an earlier version back to be reworked because it didn’t make the air clean enough.

Instead, what you get is 60 pages of legal sophistry, procedural hair-splitting and scientific conjecture.

You find a judge without a shred of technical training formulating his own policy solution to an incredibly complex problem and substituting it for the solution proposed by experienced experts.

You find an appeals court judge so dismissive of the most fundamental rules of judicial restraint that he dares to throw out regulations on the basis of concerns never raised during the rule-making process or in the initial court appeal.

Kavanaugh offers two reasons for sending the EPA back to the drawing board.

The first is that the agency had required states to come up with implementation plans for curbing cross-border pollution before it gave them the yardsticks necessary to evaluate such plans, as required by the law. The only problem is that the Clean Air Act makes no mention of such yardsticks or any obligation on the part of the EPA to provide them. Indeed, the only reason the EPA even came up with those yardsticks is that it needed them to design a federal implementation plan after 26 states failed to meet the statutory deadline for coming up with credible plans. This alleged violation of cooperative federalism turns out to be a figment of Kavanaugh’s imagination.

Kavanaugh’s other grounds for blocking the regulations is that they might someday require some state to eliminate more interstate pollution than it produces. I won’t bore you with the tortured logic that led Kavanaugh to this conclusion other than to point out that, in 60 pages, he wasn’t able to cite a fact or a study or even an example of a single state where this over-regulation was likely to result. As it happens, the EPA had looked into that possibility and concluded that it would be “extremely unlikely.”

This is precisely the kind of “judicial engagement” that we have come to expect from Kavanaugh, who was one of Ken Starr’s loyal lieutenants in the effort to impeach President Bill Clinton, who rushed to Florida after the 2000 election as part of the Bush legal team and who helped to win appointment of fellow members of the Federalist Society to the bench while working in the Bush White House. For all his intelligence, Kavanaugh is nothing more than a partisan shock trooper in a black robe waging an ideological battle against government regulation.

It is a hallmark of “conservative” judges that they genuflect before the tabernacle of judicial restraint even as they throw themselves lustily into pit of judicial activism. So it was with Kavanaugh, who in his opinion takes the rather unusual step of listing by name and citation all the recent regulations that his court has not thrown out on appeal. Perhaps the judge doth protest too much.

What Kavanaugh fails to mention is that this is the same court that last year struck down the regulation that would allow shareholders the right to nominate directors of the companies they own — a regulation that Congress expressly ordered the Securities and Exchange Commission to promulgate in the wake of the financial crisis.

It is the same court that this summer struck down a regulation by the Food and Drug Administration requiring cigarette companies to include graphic warnings against smoking on each pack in addition to the traditional verbal warning. In that case, Judge Janice Rogers Brown, another Federalist Society libertarian, declared that the public health experts at the FDA were simply wrong in concluding that graphic warnings would have some additional impact.

And it is the same court that is almost certain to rule on a case filed last week by the Chamber of Commerce and the American Petroleum Institute against an SEC regulation — also explicitly ordered up by Congress — that would require public companies to disclose all payments to foreign government for rights to develop oil, gas and mineral resources. The chamber and the oil companies argue that such “required speech” violates their First Amendment rights.

The prospect that some balance might be restored to the nation’s second-most powerful court has long since faded after Senate Republicans successfully filibustered every nominee put forward by President Obama for the three vacant seats on the D.C. Circuit. The only hope now is that Chief Judge David Sentelle and some of the court’s more intellectually honest conservatives will move to rein in the judicial radicals before they turn the courts into just another dysfunctional branch of a dysfunctional government.

 
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