The Corner

Politics & Policy

Regulating the Regulators

Yesterday, during an unrelated White House ceremony to mark the festival of Diwali, President Trump mentioned that he has decided to nominate Neomi Rao for the seat vacated by Brett Kavanaugh on the DC Court of Appeals. Since last year, Rao has been serving as the administrator of OIRA, the Office of Information and Regulatory Affairs within the Office of Management and Budget at the White House. This has made her the administration’s chief regulatory officer, and therefore its chief deregulatory officer.

Rao is simply a fantastic choice for the DC Circuit spot. A former Clarence Thomas clerk and a brilliant legal scholar, she has the right mix of experience and training to be a superb judge (and at 45 years old, she could be a superb judge for a very long time). She also has the temperament every American should want in a senior federal judge—calm and thoughtful, but thoroughly independent-minded and unafraid of thorny controversies.

If the Senate confirms her, as it certainly should, the administration will need someone new to lead its regulatory shop, and it’s awfully important that the job go to someone committed to advancing a durable transformation of the broken and misguided federal regulatory apparatus. Rao has had this vision, and has tried to implement it. But it has to be said that while she has seen through some significant rollbacks of (particularly second-term) Obama-era rules, we have not seen serious changes in the structure of federal regulation in this period, and so the Trump administration’s deregulatory efforts to date are not likely to leave a lasting mark as they now stand.

One crucial change that’s needed, and could be undertaken without new legislation, is to bring the so-called “independent” regulatory agencies more clearly under the control of the executive branch, so that they might be made more answerable to our constitutional system.

From the National Labor Relations Board and the Consumer Product Safety Commission to the Securities and Exchange Commission, the Federal Communications Commission, the Federal Deposit Insurance Corporation, and the rest of the dozen or so commissions that regulate the national economy, these agencies are generally considered independent because there is a limit on the president’s ability to remove their leaders. But as a practical matter, they are also generally independent of the review and coordination process by which the president and his senior appointees oversee the regulatory function of the executive branch. Even the Treasury Department, which is run by a secretary who obviously can be removed by the president, exercises this peculiar form of independence from review.

Bringing these agencies under the umbrella of presidential review and control would be a step toward bringing them more generally into the fold of the constitutional system, which has only three branches of government and no fourth super-branch of regulators. It’s a reform conservative legal scholars have wanted for years—Rao herself prominently among them. And because it would strengthen the White House within the executive branch, a change like that would actually be likely to be retained even by future Democratic presidents. It would be a real step toward putting the administrative state in its place.

Let’s hope the next OIRA administrator takes up that effort from Rao. If the administration is looking for people who fit that bill, they could do much worse than Jeff Rosen, who is one of the foremost conservative administrative-law experts in the country, now serves as Deputy Secretary of Transportation, and would be pretty much perfect.

Yuval Levin is the director of social, cultural, and constitutional studies at the American Enterprise Institute and the editor of National Affairs.

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