The Original FTC

Abstract

In 1914, Congress established the Federal Trade Commission. At the outset, the agency had a limited set of powers that it exercised in aid of Congress and the courts. Congress provided that the commissioners of the FTC were generally to be free from presidential removal. And in Humphrey’s Executor v. United States, decided in 1935, the Supreme Court upheld these protections as constitutional. The Court in that case rested its holding on the quasi-judicial and quasi-legislative nature of the FTC’s functions. Today, Humphrey’s Executor looms large—its holding suggests that the President cannot remove FTC commissioners at will, even 90 years after the Court decided the case.

That is incorrect. In the years since Humphrey’s Executor, Congress has expanded the FTC’s powers dramatically. It is no longer the quasi-judicial and quasi-legislative agency that the Court in Humphrey’s Executor evaluated. Thus, because the statutory scheme evaluated in Humphrey’s Executor no longer exists as it was when the Court decided the case, the Court’s holding no longer applies to the modern FTC. The difference between the original FTC and the modern FTC compels the following conclusion: The President can remove FTC commissioners at will without contravening Humphrey’s Executor or any other precedent of the Supreme Court. 

Keywords: constitutional law, administrative law, executive power, separation of powers, presidential removal power, antitrust, federal trade commission