Judge Amy Coney Barrett’s nomination to the Supreme Court has brought the public’s attention to divisive social issues like abortion rights, but replacing the late Justice Ruth Bader Ginsburg with a more conservative figure could have an equally important effect on business regulation and the U.S. economy.
“Barrett is likely to be a pro-business justice, to restrict the ability of government to adopt some economic regulations, and would likely vote to expand the constitutional rights of business,” said Adam Winkler, constitutional law professor at UCLA and author of the book “We the Corporations: How American Businesses Won Their Civil Rights.”
That could be good news for stock-market investors, as analysts have long pointed to the Trump Administration’s efforts to roll back Obama-era regulations and slow the implementation of new rules as a major driver of recent stock-market gains. Since President Trump’s election in November of 2016, the S&P 500 index (SPX) has returned 60.4%, according to FactSet. But it is a potentially troubling proposition for workers-rights advocates and environmentalists who have increasingly relied on agency regulation to achieve their policy goals.
One contentious issue being litigated in federal courts is Environmental Protection Agency regulations that limit electric power plants’ ability to emit greenhouse gases. President Obama’s Environmental Protection Agency argued that the 1972 Clean Air Act requires it to issue such regulations, resulting in the 2016 Clean Power Plan. The Trump Administration subsequently rolled back those regulations, instituting a more business friendly Affordable Clean Energy rule.
But some conservative lawmakers, legal thinkers and activists argue that the Supreme Court should go further and strike down the EPA’s ability to regulate greenhouse gases whatsoever. Jonathan Wood, attorney at the conservative Pacific Legal Foundation, told MarketWatch that many federal judges have questioned, on constitutional grounds, the ability of federal regulators to use old laws to make new regulations on issues that weren’t on the minds of Congress when those laws were passed, and a more conservative court could potentially make this view the law of the land.
“The idea that the Clean Air act in 1972 answered the question of how to address greenhouse gas emissions is sort of laughable,” he said. “But because courts have been so willing to defer to agency interpretations of statutes, they’ve gotten away with stretching statutes and trying to create policy without having to go back to Congress and say, ‘Oh, we’ve run into a new challenge, we need you to write new legislation to deal with it.’ ”
Of central importance to this debate is the doctrine of Chevron deference, which the Supreme Court established in 1984, and which requires judges to defer to agency interpretation of statutes as long as that interpretation is reasonable. Conservatives have long railed against this principle as one that has led to the growth of the administrative state.
“[Chevron (CVX) deference] has become a direct threat to the rule of law and the moral underpinnings of America’s constitutional order,” wrote Sen.