Businesses Fear Politicization as Trump Gains More Power Over U.S. Agencies
A Supreme Court ruling that presidents can fire independent regulators without cause has added volatility for industries that prefer stable enforcement.
A Supreme Court ruling that presidents can fire independent regulators without cause has added volatility for industries that prefer stable enforcement.
Companies are bracing for the fallout of a decision by the Supreme Court last week that allows the president to fire members of federal regulatory boards for any reason, stripping those regulators of their independence from the White House.
The decision has implications for more than a dozen agencies that oversee power companies, railways, investment banks, labor disputes and the biggest technology companies. Now, corporate executives and lawyers are grappling with the potential for these agencies — which set the rules and enforce them — to become even more political.
The decision “enables a lot more mischief,” said Douglas Melamed, a former general counsel at the chip maker Intel and a former senior official at the Justice Department. “The president is totally free to micromanage things and really squeeze these agencies.”
The ruling adds to the unpredictability of doing business in the United States, where regulation has heavily depended on which party is in power. Republicans tended to loosen the rules, while Democrats tended to add restrictions.
Under the Biden administration, for example, regulators limited drilling on public lands, banned noncompete agreements and sued Adobe and Live Nation, arguing that the companies broke antitrust and consumer protection laws. After President Trump took office a second time, his appointees quickly reversed or abandoned those decisions and settled those lawsuits.
These policy swings tended to be moderated by the federal agencies, which have long held bipartisan leadership. And federal law forbade the president to fire the regulators without cause.
