Thoughts A Brewin' Newsletter 5: Blindly Trusting Regulatory Agencies Must Come To An End
Yesterday, the Supreme Court of the United States (SCOTUS), heard oral arguments in Loper Bright Enterprises,Inc. v. Raimondo and Relentless, Inc. v. Department of Commerce. The decision of this case has the potential to shock the conscience of the administrative state and have massive repercussions to the network marketing space and businesses across the United States.
The facts of the case are rather specific to fishing vessels, but the more important question presented to the Court is: “Whether the Court should overrule Chevron or at least clarify that statutory silence concerning controversial powers expressly but narrowly granted elsewhere in the statute does not constitute an ambiguity requiring deference to the agency.
In 1984, SCOTUS heard a case by the name of Chevron v. Natural Resources Defense Council. In that case, SCOTUS reiterated the idea of deferring to the regulatory agencies when it comes to interpreting ambiguous provisions of a statute that Congress has passed. As long as the agency’s interpretation is “reasonable” as to the ambiguity, the deference should stand. This deference to federal agencies has become commonly known as Chevron deference. This deference to agency interpretation has given immense power to the administrative state and has further placed everyday society to the will of the unelected. SCOTUS has not cited Chevron directly since 2016, but the impact the case has is evident.
What does this mean and how has this deference prevailed over the last 40 years?
This deference has been applied across the board from what constitutes a new or existing power plant to what is an internet service provider or an investment contract, to how immigration is implemented against the individual. The most applicable example for the network marketing industry is the FTC Act’s Section 5 provisions granting the FTC the power to prohibit “unfair or deceptive acts or practices in or affecting commerce.” What exactly is an unfair or deceptive act? While we can agree that no company or individual should be free to operate unfairly or deceptively, the lack of clear guidelines from Congress or otherwise permits the FTC and other regulatory agencies to constantly shift according to the political wind of the day.
When the best argument the government has as to not changing a rule is, well this is how we’ve always done it and it would mess up what we have going here, there are serious concerns.
My prediction is that SCOTUS will deliver another victory to network marketing, small businesses, and the little guys across the country as they significantly curtail Chevron deference and return the power to the people. Article I, Section 1 of theConstitution declares, “All legislative Powers herein granted shall be vested in a Congress of the United States.” In short, Congress makes the laws, not an unelected administrative state. It behooves the country to return to this basic founding principle.