Easier road seen for Obama regs

Easier road seen for Obama regs
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The Obama Administration’s second-term regulatory agenda should be an easier lift, thanks to changes to the Senate’s filibuster rules that make it easier to fill key agency positions and install federal judges.

The Senate’s move this month to lower the threshold to reach final confirmation votes strengthens President Obama’s hand when it comes to imposing regulations in support of his policy agenda.

Instead of a 60-vote threshold that required support from at least five Republicans, the president can now afford to lose a handful of Democrats and still win Senate confirmation for his nominees with a simple majority vote. 

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Consumer advocates and watchdog groups heralded the action, pointing to 189 executive nominees and 53 judicial nominees now awaiting confirmation.

Vacancies now “should be easier to fill with people who meet the basic criteria of having a commitment to fulfilling the law,” said Lisa Donner, executive director of Americans for Financial Reform.

Congressional Republicans like Sen. Thad Cochran (R-Miss.) criticized the maneuver and said in a statement that the Senate would be turned into “a rubber stamp for any President.”

Three of the judicial vacancies are at the powerful D.C. Circuit Court of Appeals. The court is charged with ruling on challenges to rules imposed by federal agencies, often making it ground zero for battles over Obama’s regulatory agenda.

The court’s bench is currently split evenly between judges nominated by Democratic and Republican presidents. But five of six semi-retired “senior judges” who help with the court’s workload were installed during Republican administrations.

In recent years, the court has dealt a series of blows to the Obama administration’s agenda by striking down regulations on numerous fronts.

The change in the Senate’s rules come at a time when judges are expected to decide major disputes over provisions in the Dodd-Frank financial reform law, ObamaCare and the president's push on climate change, several observers of the court said.

“It removes one set of barriers to having regulations in place,” Donner said.

Beyond blocking regulatory initiatives, the court has had a chilling effect on agencies that regulate the financial sector, advocate groups say.

In 2011, for example, the court struck down a Securities and Exchange Commission rule meant to give shareholders a greater voice in nominating individuals to serve on companies’ boards of directors.

The “proxy access” rule had been drafted under the 2010 Dodd-Frank Act, and the court’s ruling “cast a huge pall” of fear over agencies writing rules under the landmark Wall Street reform law, Donner said.

“Rulemaking ground to a halt,” added Bart Naylor, a financial policy analyst for Public Citizen.

Naylor said that agencies, faced with the potential that their rules would be challenged by industry and struck down by the court, grew needlessly timid.

Last year, the D.C. Circuit rejected the Environmental Protection Agency’s (EPA) regulation of power plant emissions that cross state lines, saying the agency overstepped its authority under the Clean Air Act.

The decision was seen as a major setback for the administration’s air quality agenda.

Environmental groups like the Sierra Club helped push Senate Majority Leader Harry Reid (D-Nev.) to trigger the so-called “nuclear option” and eliminate the 60-vote threshold.

The lower bar could make it easier for Obama to nominate judges who are less likely to strike costly blows to regulations limiting greenhouse gas emissions from coal and gas power plants, a key pillar of the president’s second term agenda.

Aspects of ObamaCare may also be headed to the D.C. Circuit in coming years.

A challenge to the federal government’s ability to offer tax subsidies to people buying insurance through a new insurance marketplace created by the Affordable Care Act is currently working its way through the court system.

The healthcare reform law created a number of new insurance marketplaces in states across the country. People in the 36 states that did not create their own exchanges can shop for insurance on an exchange run by the federal government, which has been under fire lately for a series of technical glitches.

But several groups challenging the subsidies say that Congress never intended to allow people on that federal exchange to get tax credits for buying insurance. The law only allows the subsidies to be doled out to people shopping on state-based exchanges, they say.

“Now, on a matter like that, that involves administrative law, I think having a different center of balance and having a different ideological balance might well make a difference on the court of appeals,” said James Blumstein, a professor at Vanderbilt Law School.

The Senate’s rule change does not apply to nominees to the Supreme Court, however. That could be a backstop preventing potentially controversial judges from deciding the most influential cases.

“My guess is cases like that are so significant that, at the end of the day, the court of appeals will not be final answer,” Blumstein added.

The Senate’s move also clears the way for Obama to nominate people to a range of new positions, including the controversial Independent Payment Advisory Board, a currently empty board designed to keep down costs of Medicare.

Some commentators have noted that the change in filibuster rules might also allow for Obama to replace high-level administration officials without the fear of a lengthy confirmation battle.

“Now it’s possible to pick nominees for agencies that, by their very nature, are controversial or to put forward nominees who in particular are controversial for a post with Medicare, with [the Department of Health and Human Services],” said Mark Hall, a law professor at Wake Forest University.

But Obama is unlikely to suddenly start making contentious nominations, said Maryland law professor Rena Steinzor, who serves as president of Center for Progressive Reform.

Rather, she said, the new Senate rules would help Obama fill long vacant positions at agencies already reeling from strained resources following this year’s sequester cuts.

“I don’t expect a bunch of fiery appointments,” she said.