The campaign to gut Washington’s power over corporate America

The campaign to gut Washington’s power over corporate America

Politico reports:

A decade-long conservative crusade against financial regulators will come to a head soon with a crucial Supreme Court ruling, part of a legal strategy that has spread across multiple Washington agencies into a broad attack on a core power of the federal government.

The court’s ruling on Securities and Exchange Commission v. Jarkesy, a case challenging the power of in-house federal judges, could hobble a whole range of agencies in unpredictable ways, cutting the powers of antitrust enforcers, labor regulators and consumer finance watchdogs.

Driven by an alliance of tech billionaires, conservative legal activists and the business lobby, the legal campaign that has arisen around Jarkesy is a little-appreciated but significant version of the “war on the administrative state” that Donald Trump promised but largely failed to deliver.

The decision is one of three Supreme Court fights this term over efforts to undermine key powers of the federal government. On Thursday, the justices came down in favor of regulators by upholding the funding of the Consumer Financial Protection Bureau. Another pair of cases awaiting decision could overturn a crucial 40-year precedent that allows agencies to broadly interpret federal law.

Jarkesy itself is a challenge to the legal legitimacy of the SEC’s internal system of judges and courts, which hear cases and impose fines. Such internal courts are key to enforcement at many federal agencies. Critics say they give bureaucrats an unchecked, almost shadowy power when cracking down on business malfeasance — a power they believe properly belongs with the U.S. court system.

“I support the right to a jury trial. Period, end of story,” said billionaire entrepreneur Mark Cuban, who has agitated against the SEC’s courts for years, after beating insider trading allegations brought by the agency a decade ago. “There is no constitutional reason or support for the SEC or any government agency to supersede that.”

Since Jarkesy was filed, companies including Meta, SpaceX and Amazon have escalated it into a broader fight against federal power by suing other agencies over their own courts — a way of fighting unfavorable judgments by attacking the system that delivered it. [Continue reading…]

Comments are closed.