Removal as a Political Question

Article excerpt

INTRODUCTION
  I. DOCTRINAL FOUNDATIONS
     A. Removal Before Free Enterprise Fund
     B. Free Enterprise Fund
     C. The Political Question Doctrine
 II. REMOVAL AUTHORITY AS A MEANS OF BUREAUCRATIC CONTROL
     A. The Plural Technologies of Bureaucratic Control
     B. The Removal Power in Institutional Context
        1. Variable marginal effects
        2. Interaction effects
     C. Theorizing Removal's Limits
        1. Information asymmetries
        2. Transaction costs
     D. Empirical Evidence of the Removal Power's Limits
        1. Historical and contemporary U.S. evidence
        2. Comparative evidence
        3. Private contracting
III. THE WEAK LINK BETWEEN PRESIDENTIAL CONTROL AND DEMOCRATIC
     ACCOUNTABILITY
     A. Interaction Effects of Presidential Control
     B. Presidential Control as a Democratic Accountability Mechanism
     C. Unpacking Democratic "Accountability"
 IV. THE REMOVAL POWER WITHOUT COURTS
CONCLUSION

INTRODUCTION

Until now, federal courts have played only a small role in elementary design decisions about the regulatory state. Instead, the political branches select policies, while agencies created by the political branches interpret and enforce those policies on the ground. (1) Courts, to be sure, play a supporting part policing the use of delegated authority, (2) but their influence on the administrative state's basic architecture has to date been minimal. (3)

Suddenly, the status quo is in doubt. A recent Supreme Court decision portends a larger judicial role in drawing up blueprints for federal agencies. The holding of Free Enterprise Fund v. Public Company Accounting Oversight Board (4) is modest. But it rests on an underlying principle with wider potential implications. In Free Enterprise Fund, the Court invalidated a single provision in the Sarbanes-Oxley Act of 2002. (5) Among other reforms, the Act created the Public Company Accounting Oversight Board (PCAOB) to protect investors by supervising the audits of public companies. (6) The challenged provisions seriously restricted the President's authority to remove PCAOB members. (7) In the Court's view, the Act permitted removal of PCAOB members only by the Securities and Exchange Commission (SEC) and then only on a showing of good cause; SEC commissioners also could be removed only on a showing of good cause by the White House. (8) This "dual for-cause" regime created a buffer between the PCAOB and the President that, the Court held, conflicted with the promise of democratic accountability immanent in Article II of the Constitution. (9) This specific holding rested on a more general syllogism. First, the Court held that power to remove a bureaucrat was essential to establish control over that official's policy decisions. (10) Second, the Court reasoned that absent presidential control, the democratic accountability demanded by Article II would be wanting. (11) Based on these two premises, the Court concludes that Article II entails a quantum of presidential removal authority respecting agency officials in order to preserve democratic accountability.

If this principle could easily be cabined to the "dual for-cause" regime at issue in Free Enterprise Fund, it would warrant only passing attention. (12) But big things often have small beginnings. The Free Enterprise Fund principle cannot easily be limited to "dual for-cause" regimes. Rather, the decision's fundamental logic "calls into question the constitutionality of hundreds of other governmental positions" buffered from presidential control, (13) even those positions protected by only a single layer of for-cause removal limitations. The opinion thereby invites judges to hunt through the U.S. Code, striking out tenure protection rules. (14) Hence, the limited scope of short-run consequences from Free Enterprise Fund for the PCAOB itself belies a more important long-term ramification: dramatic enlargement of judicial authority to dictate elementary parameters of agency design. …