The Daily - The Fishermen Who Could End Federal Regulation as We Know It

Episode Date: January 19, 2024

On its surface, the case before the Supreme Court — a dispute brought by fishing crews objecting to a government fee — appears to be routine.But, as Adam Liptak, who covers the court for The Times explains, the decision could transform how every industry in the United States is regulated.Guest: Adam Liptak, a Supreme Court correspondent for The New York Times.Background reading: How a fight over a fishing regulation could help tear down the administrative state.The case is part of a long-game effort to sap regulation of business.For more information on today’s episode, visit nytimes.com/thedaily. Transcripts of each episode will be made available by the next workday.

From New York Times, I'm Michael Barbaro. This is The Daily. This week, the Supreme Court heard a case that, on its surface, appears to be a routine dispute over a government fee. In reality, it could transform how every industry in the country is regulated. My colleague, Adam Liptak, explains. It's Friday, January 19th. Adam, welcome back to the show.

Hello, Michael. So, Adam, remind us of the show. Hello, Michael. So, Adam, remind us of the essential facts of this case that just ended up before the Supreme Court a few days ago, a case that I know you see as among the most important and consequential of this Supreme Court term. What on paper is it about? So, this case is about herring fishermen in Cape May, New Jersey. I went to visit them, and among the people I talked to was a fisherman named Bill Bright. Well, I'm actually a first-generation fisherman. I've been fishing for 40 years.

I actually quit my union job to try fishing, and I've been fishing ever since. Can I ask you how old you are? 64. I'm 63, so you're older than me. Probably not wise. And they told me that they have long been living under a 1976 law that requires them to take federal observers out with them on their fishing trips. They go out for a week at a time, and those observers gather data to prevent overfishing.

What has the role of government been over the years? The role of the government has slowly been increasing, which has been warranted in a lot of situations because we do need quotas for every fishery. We know that. And what they told me was that they like the observers. They think the observers are valuable. They're on board, so to speak, with the observers. So overall, fisheries management and the role of the government

has been a good thing overall because we know without that, most of us would not be fishing today. But come 2020, the agency in charge of this program, called the National Marine Fisheries Service, takes a turn and says, not only do you have to take the observers out with you, but you have to pay for the privilege. Hmm. Why? Partly because the agency was low on funds, partly because they wanted to expand the program,

and the fishermen had a problem with that. They had a practical problem, they told me. Give me a sense of the actual dollars and cents. How much did they want you to pay for the monitors? And what percentage? At the time, but this is pre-pandemic price, was $700 a day. Because that is a significant cut of their profits? That's the monitor would get $5,000. That's pretty close at 5% of a good trip that a crew member would get. So he would get the same on a good trip that a crew member would get.

So he would get the same on a good trip that a crew member would get. But on a bad trip, he still gets a $5,000 and they get next to nothing. Right. And they have a kind of philosophical legal problem with it too. They say the 1976 law doesn't authorize these payments and that the agency shouldn't be allowed to interpret the law to say that it does. So what's your reaction to the idea that you should not only host the monitor but pay for the monitor? I don't think it's fair. And I also now with everything that we have going with the rising costs, especially after the pandemic, to tack that onto us, that tax is going to be very burdensome to a business that's very burdened in the beginning. So this feels like a pretty small scale dispute over basically who should pay for the implementation of this government regulation that there be monitors

on these boats? Yeah, it barely feels like a Supreme Court case, right? Right. It's a routine legal dispute, but it has embedded in it a huge question. And that's the question of who gets to decide what this 1976 federal law means or what any federal law means? Is it the agency in charge of implementing it? Or should it be a judge without giving any particular kind of deference to the agency? And that takes us to a 1984 landmark Supreme Court case, one of the most cited, most influential cases in our history, called Chevron v. Natural Defense Resources Council.

That case gave rise to a concept called Chevron deference, which is not about deferring to Chevron, the oil company, but about the precedent set out in that case about who should get deference. Chevron deference says that if a statute passed by Congress is ambiguous, the agency gets to interpret what it means, so long as its interpretation is reasonable. And courts have to defer to the agency's interpretation. That is, judges who are ordinarily in charge of saying what the law means and what statutes mean have to put the thumb on the scale in favor of federal agencies, expert agencies, on what congressionally enacted statutes mean. So under the Chevron deference doctrine, these fishermen don't really seem to

have much of a legal case here, right? The doctrine says that if that 1976 law is in any way unclear on the question of who pays for these monitors, a government agency is going to make that call, and a government agency has made the call that the fishermen pay. So that's more or less that. That's right. And when they sue, a federal appeals court says, That's right. And when they sue, a federal appeals court says, the statute's ambiguous. That means the agency gets to decide law and has done work for decades to resolve cases on things like protecting the environment, workplace safety, consumer protection, nuclear power, almost everything you could imagine from all of the many federal agencies. The entire legal system is rooted in this idea that in cases where a statute is ambiguous, agencies rather than courts are going to be kind of at the front line in deciding what the law means. Because, the thinking goes, they're the experts. They know their subject matter areas, and they should have a role in the process of deciding what Congress meant to do.

in the process of deciding what Congress meant to do. Congress, of course, can't anticipate every development. And the thinking behind Chevron is that it has at least implicitly delegated to agencies the opportunity to fill in the gaps and make statutes work on the ground. It's very clear to me, Adam, how this doctrine benefits the executive branch and the dozens of agencies within it and all their experts because it forces judges to defer to them. However, if I'm in an industry being regulated by these agencies and these government workers like these fishermen, I clearly view this differently. Right. Business groups especially are very hostile to Chevron, hostile to what they call the administrative state, the power of executive agencies generally. And they have been looking for some time now to find the perfect vehicle to take down the Chevron doctrine, to do away with

it. For practical reasons, they don't like being regulated. For philosophical reasons, they think judges should take the leading role in saying what the law is. And these fishermen in New Jersey, along with another group in Rhode Island, are represented by well-funded conservative groups with financial ties to Charles Koch, the conservative billionaire. And this case seems to be a very likely vehicle to undo the key precedent in this area of the law. Got it. So we should not be viewing this case as simply the story of local fishermen who don't want to pay for the monitors on their boats who are counting up how many fish they catch.

We should view it in the much broader landscape of an ongoing conservative effort to dismantle regulation and prevent the government from playing the role that it does in regulating the companies like the ones that Charles Koch runs. Yeah, this case is both small and easy to understand and huge and a little complicated but extremely consequential. Because if the fishermen win, it will be on the ground that Chevron deference goes out the window and all of American law, to a probably larger extent to the courts, and regulation becomes harder to implement. Across the board? In every imaginable federal setting, yeah. We'll be right back. So, Adam, how do these oral arguments in the case unfold?

So, Wednesday morning. We'll hear argument first this morning in case 22-12-19. The court hears arguments, starting with Roman Martinez, a lawyer for the Fisherman. Mr. Chief Justice, and may it please the court, for too long, Chevron has distorted the judicial process and undermined statutory interpretation. Who makes a couple of basic points. Article 3 empowers judges to say what the law is. It requires them to interpret federal statutes using their best and independent judgment. Chevron undermines that duty. That the separation of

powers gives the judiciary in Article 3 of the Constitution the obligation to say what the law is, and that Chevron was wrong from the start. There's no reason to think that Congress intends every ambiguity and every agency statute to give agencies an ongoing power to interpret and reinterpret federal law in ways that override its best meaning. And can be overruled, notwithstanding the usual rule that the Supreme Court should not discard precedents unless they were egregiously wrong and have proved unworkable. If we have the best view of the statute, we should win this case. I welcome the court's questions. the statute, we should win this case. I welcome the court's questions.

So Martinez's argument is that the Chevron deference doctrine is egregiously wrong and should be discarded, and that under it, far too much power to interpret regulations is being automatically given to government agencies rather than judges. That's right. Let me give you a few more examples along the same lines, Mr. Martinez. And that almost immediately gets pushback from the liberal justices who do everything they can to try to save the doctrine. And one of the things they do, which is what judges do, is throw out hypothetical questions,

testing what the world would look like if we didn't have Chevron. So I was thinking, what is the next big piece of legislation on the horizon? And who knows, don't have a crystal ball, but I'm going to say, I'm going to guess that it's artificial intelligence. Justice Elena Kagan imagines, not a huge feat of imagination, that Congress may sometime pass a law addressing artificial intelligence. Congress knows that there are going to be gaps because Congress can hardly see a week in the future with respect to this subject, let alone a year or a decade in the future. That law would, by nature, have to be general, have to contain ambiguities, because it's such a fast-evolving part of modern life.

Does the Congress want this court to decide those questions, policy-leading questions of artificial intelligence? And Congress would probably expect that, she says, an expert agency would interpret it, fill in the gaps, make it applicable, make it useful, and not some random judge somewhere in the country with no expertise at all. And what she's really getting at, Adam, is that the virtue of the Chavon Doctrine is that it ensures that subject matter experts within these agencies are going to take the reins when Congress inevitably writes that necessarily ambiguous rule.

And she's picking AI because it's a perfect test case of the most complicated area in the universe in which you'd want that subject matter expert to weigh in. That's right. And in truth, many statutes are necessarily ambiguous and can't anticipate the future. But that doesn't answer the question of who should decide under our constitutional system. And what Roman Martinez says is, listen, you can take account of what the agency says, but it's the judge's job in the end to make the decision without, he would say, abdicating the judicial role to, I'm going to put words in his mouth,

an unelected bureaucrat. My point is, it's really convenient for some members of Congress not to have to tackle the hard questions and to rely on their friends in the executive branch to get them everything they want. Another lawyer, Paul Clement, representing the fishermen, made the point that Chevron also makes life too easy for Congress. Ambiguity is not ours as a delegation. And more often, what ambiguity is, I don't have enough votes in Congress to make it clear. So I'm going to leave it ambiguous and then we'll give it to my friends in the agency and they'll take it from here. That Congress is incentivized to pass ambiguous laws when it could pass more careful ones.

And that Congress kind of likes that because it is easier and gets them in less political trouble if they say general things rather than specific things. And Congress should not kind of delegate to the executive branch the lawmaking function. It's an interesting argument, and it puts a whole lot of confidence in members of the United States Congress. As a matter of political theory, it makes a lot of sense. As a matter of political reality in 2024, it's pretty hard to imagine that this Congress is going to be able to enact many sensible laws at all, much less intricate ones closely addressing

the major problems of our time. General Prelogar. Mr. Chief Justice, and may it please the court. And when the lawyer for the government, Solicitor General Elizabeth Prelogar, gets up defending the Chevron doctrine, she says that undoing a system we've lived with for some 40 years would result in chaos. Congress, agencies, states, regulated parties, and the American public have all relied on Chevron and the regulations upheld under it to make important decisions that could be upended by overruling that framework.

And the court should not lightly make that step when Chevron, she says, has served us well. And Prelager also points out that the court has heard cases like this before, at least in a related setting, and it has declined to overrule precedents that would cause so much chaos. The court observed that it would be the rare overruling that would introduce so much instability into so many areas of the law all in one blow. Overruling Chevron would be an even greater and unwarranted shock to the legal system.

I welcome the court's questions. And what's the response from the justices that overturning this doctrine would basically create the legal equivalent of an earthquake that would kind of shatter the system? Well, one interesting response came from Chief Justice John Roberts. Counsel, you began by saying Chevron is foundational. We get a lot of statutory interpretations from agencies. And I don't know whether it was 14 or 16 years, we haven't relied on Chevron over that time. I mean, have we overruled it in practice? Even if we've...

We sort of said, what's the big deal? We haven't cited Chevron in years. It's sort of dead to us already. And that's true. And that's because the court, as we've often talked about, Michael, has shifted to the right. And one of the projects of the conservative legal movement, they've placed recent conservative justices on the court, has been hostility to the administrative state and to Chevron. So in a sense, this is already happening at the Supreme Court level. And you can see this from some sharp questions from one of Donald Trump's appointees, Justice Brett Kavanaugh. But the reality of how this works is Chevron itself ushers in shocks to the system every four or eight years when a new administration comes in, whether it's communications law or securities law or competition law or environmental

law, it goes from pillar to post. He says the idea that Chevron is a force for stability is exactly backwards, that executive agencies change their positions as administrations change. Every four or eight years, he says, you get a different answer to the question of what does the law mean. That is not stability. And so I think to hold up stability and reliance is a little tough given just watching how it operates every four years. It feels like there could be some truth to that. What is the government lawyer's response to what Kavanaugh is claiming here? Prelogar responds that if there's authentic ambiguity in the law that Congress passed,

then Congress would know that different presidential administrations might have different ways of thinking about it. And she says there's nothing inherently wrong with that. She says getting rid of Chevron, though, would create a whole new level of instability. But there are 800 district court judges around the nation, and I think it's fair to say they will likely have different takes about how to ultimately fill the gap in administering the statute. If you let every district court judge in the country decide for him or herself what a given regulation means, that's going to give rise to a kind of chaos, to a kind

of patchwork where people in Georgia are subject to different regulations than people in California. And that's not a desirable result, she says. Thank you, counsel. The case is submitted. result, she says. Thank you, Your Honors. Thank you, counsel. The case is submitted. Okay, so Adam, this is the part of any oral arguments episode where I need to ask you to kind of cut through the two sides of the argument and the liberal interrogations of the lawyers and the conservative interrogations of the lawyers, and tell us with your predictive eye how this case is likely to be decided. Is the Chevron doctrine basically dead? Chevron is either dead or will survive in a kind of zombified, hollowed-out version where it doesn't do very much work or it does work in a very narrow band of cases. But the short answer is that this is probably the case this term that overrules a major precedent, like affirmative action in the last term, like abortion in the previous term.

The right side of the court usually has one big project, and I think this is the project for the current term. That project being to overturn decades of deference to government agencies and clear a path for pretty sweeping deregulation in the United States. Right. So the conservative legal movement has kind of social aspects to it, and abortion and Roe v. Wade was long a target. But Chevron is the equivalent for that part of the conservative legal movement that really hates what they call

the administrative state, and taking down Chevron would be a huge victory for them. Adam, there's something distinct about this case if, as it turns out, it's the latest victory for the conservative movement. I mean, overturning Roe was about discouraging abortion, which the conservative movement abhors, ending affirmative action, banned racial preferences, which conservatives view as unfair. This case, if conservatives win it, is going to end up giving a tremendous amount of power to the judiciary, as you've explained. And if you know anything about the American conservative movement, you know that for the longest time it has complained that unelected judges, especially they say liberal judges, already have far too much power. So there's a kind of irony to the fact that this is a case that's going to put even more power into the hands of judges. That's a good point.

And it may be irony or it may be opportunism. The right was unhappy with liberal judges when there were a lot of liberal judges and when the court was reaching liberal results. Now that the right controls the Supreme Court and is very powerful in the lower courts, it may take a different view. It's also the case that the Supreme Court, in general, likes to be the decider. It seems to decide every consequential social issue in the land. And getting rid of Chevron, among other things, increases judicial power, which the Supreme Court likes. This Supreme Court likes. That's right.

Well, Adam, thank you very much. We appreciate it. Thank you, Michael. We'll be right back. to stop what it said was an imminent attack on ships in the Red Sea. Despite repeated U.S. attacks, American officials say they have damaged or destroyed only about 20 to 30 percent of the Houthis' offensive capability, suggesting that the group's attacks are likely to continue. And...

Mr. President, we have good news for America. There will not be a shutdown on Friday. On Thursday, Congress passed a last-minute short-term funding bill that barely avoided a partial government shutdown. The bill, which would fund the government through March, was adopted over the strenuous opposition of far-right Republicans who have demanded deep cuts to spending. And it marks the third time this fiscal year that Congress, unable to pass a long-term budget, has extended spending on a temporary basis. Today's episode was produced by Will Reed, Michael Simon-Johnson, and Aastha Chaturvedi.

It was edited by John Ketchum, contains original music by Dan Powell and Marion Lozano, and was engineered by Chris Wood. Our theme music is by Jim Brunberg and Ben Lansford of Wonderland. That's it for The Daily. I'm Michael Barbaro. See you on Monday.