Wayne O'Leary

The Conservative Deregulation Project

“Those who devised the Fourteenth Amendment [aimed] to curb the many who would do to the few as they would not have the few do to them.” — Sen. Roscoe Conkling (R-N.Y.), 1882

Conservatives are at war with something they call the “administrative state,” also known by its more pejorative name, the “deep state.” In reality, there’s no such thing beyond political rhetoric; it’s a purely theoretical construct by right-wing ideologues and libertarian think tanks, one that conjures up shadowy, conspiratorial forces operating secretively throughout the federal bureaucracy, contaminating institutions, implementing a biased liberal agenda, and undermining the American way of life.

Actually, when conservatives refer to the administrative state, they really have in mind the innumerable agencies of government created over time to regulate the national economy and improve the lives of average Americans. Examples include the Federal Trade Commission (FTC), 1914; Food and Drug Administration (FDA), 1931; Federal Communications Commission (FCC), 1934; Securities and Exchange Commission (SEC), 1934; National Labor Relations Board (NLRB), 1935; Environmental Protection Agency (EPA), 1970; Occupational Safety and Health Administration (OSHA), 1970; and, most recently, the Consumer Financial Protection Bureau (CFPB), sponsored by Sen. Elizabeth Warren (D, Mass.) in 2010.

With few exceptions, right-wing Republican activists regard such regulatory agencies as evil creations that interfere with economic “freedom,” objects of scorn deserving to be pared back, rendered impotent, or eliminated outright. This can be done most readily when the right controls the presidency, as during the Reagan years when Anne Gorsuch Burford, mother of Supreme Court Justice Neil Gorsuch, ran the EPA and notoriously ran it into the ground, slashing its budget by a quarter and reducing its personnel by close to a third.

Nevertheless, the Republican crusade against government regulation remained unfulfilled as we entered the 21st century, prompting a renewed effort that reached maturity during the Trump administration. Setting the stage was flamboyant presidential advisor Steve Bannon’s declaration that “deconstruction of the administrative state” would be a primary objective moving forward.

The Trump deregulators, led in particular by Mick Mulvaney at the CFPB, and climate-change deniers Scott Pruitt and Andrew Wheeler at the EPA, did their best to carry out that mission in the four years allotted to them. The EPA, a special target, was eviscerated in the short term, but across the board, the economy was turned over to the narrow interests of business and industry for the duration, following the Trump dictum that two regulations would be eliminated for every new one promulgated by a federal agency.

None of this happened by accident. The American right has systematically created a quasi-academic policymaking infrastructure over the past generation dedicated to providing the rationale and justification for an unleashing of unchecked laissez-faire capitalism. Some institutional manifestations of this infrastructure (for instance, the Heritage Foundation and the American Enterprise Institute) are quite visible and known to the public; others have flown under the radar. Prominent among the latter is Virginia’s George Mason University, a center of right-wing scholarship, and its collection of conservative and libertarian programs.

George Mason boasts the Mercatus Center, a hard-right think tank absorbed with the study of free-market capitalism and government regulation; a law school named for a conservative icon, the late Supreme Court Justice Antonin Scalia; and a law-school affiliate, the Center for the Study of the Administrative State. All are funded by generous donations from the rightist Koch Foundation, which has given the university at least $60 million since 2005, in exchange for influence over faculty hiring and course selection.

A key beneficiary of Koch money has been Neomi Rao, George Mason law professor, conservative ideologue and Republican activist. Rao, a devotee of Scalian jurisprudence, was founder (2015) of the law school’s aforementioned offshoot for administrative-state studies. In 2017, she joined the Trump team as head of the White House Office of Information and Regulatory Affairs, becoming point person for its radical deregulatory agenda.

Fortunately for the causes of good government and a fair society, the immediate and direct Trumpist onslaught against federal regulations terminated with the 2020 election, but the story doesn’t end there. What stalled politically upon Trump’s electoral defeat was simply transferred to the judiciary, coming under the sway of federal judges appointed by Trump, with ultimate power residing in the Supreme Court’s conservative majority. The so-called administrative state is still under dire threat, but now from a federal bench with lifetime tenure and an exaggerated, almost theological regard for the 14th Amendment’s due-process clause as an “originalist” concept guaranteeing property rights.

Thus, the sudden renewed interest in an almost-forgotten Court decision from 1905 as a possible roundabout way for conservative jurists to short-circuit government economic regulation. The decision, in Lochner v. New York, struck down a state health-and-safety statute setting maximum working hours for bakery employees on the grounds it violated their freedom of contract under the 14th Amendment to work longer hours, should they wish.

The amendment prevented states from depriving “any person of life, liberty, or property without due process of law,” and the Court determined the word “liberty” covered the unrestricted purchase or selling of labor. Lochner, savaged in a famous dissent by Justice Oliver Wendell Holmes, was subsequently invalidated by a 1937 Roosevelt-era ruling upholding state minimum-wage laws.

Now, however, Lochner threatens to rise from the ashes. Harvard’s Laurence Tribe, a leading liberal constitutional-law expert, sees the potential for it to upend government regulation of business in the hands of the current fanatic originalist Court. Endangering 135 years of federal economic oversight — the prototype agency of the “administrative state” was the Interstate Commerce Commission, established in 1887 — is the due-process clause inserted into the 14th Amendment in 1868, which has bedeviled American legal affairs periodically since that time.

It’s commonly believed, in the wake of two generations of revisionist historiography, that the 14th Amendment was purely the product of Radical Republican reconstruction — an idealistic effort to guarantee civil rights to emancipated slaves. It was that in part, but it was far more.

The congressional Joint Committee on Reconstruction that wrote the amendment, dominated by business Republicans, deliberately substituted the word “person” (as in corporate person) for “citizen,” enabling future conservative Supreme Courts to rationalize shielding corporate property from public interference or government regulation; this they regularly did down to the 1930s. The current Court apparently hears that siren song again.

Wayne O’Leary is a writer in Orono, Maine, specializing in political economy. He holds a doctorate in American history and is the author of two prizewinning books.

From The Progressive Populist, October 1, 2022

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