Mind the Gap: Supreme Court Contraction of Legal Discretion for the Executive Branch

Abstract

The Supreme Court, for the first time, elevated economic calculation to function as the fulcrum leveraging and allocating law-making power between the branches of government.

The federal agency regulation before the Supreme Court was estimated by the agency to impose approximately $9.6 billion in costs annually on the U.S. economy, to realize direct public benefits of $4-5 million annually. This is approximately a 2,000:1 negative cost/direct benefit ratio, before counting indirect ‘co-benefits.’ There is now new pressure to “change the math” by which the agency performs the now-required cost consideration. Incidental ‘co-benefits,’ if allowed to be considered, change the result.

This closely divided Supreme Court decision changes Chevron deference previously routinely afforded pursuant to this most-cited administrative decision in U.S. history. Every aspect of this new regulatory frontier is a matter of first impression for the Court.