The Supreme Court Broke Independent Agencies. Here’s a Way to Slow the Damage.

A crypto bill before Congress offers a chance to keep presidents from turning independent commissions into one-party instruments.

(Photo illustration by Bill Kuchman/The Bulwark | Photos: Shutterstock)

THE SUPREME COURT on the next-to-last day of its term ended the commonsense principle that officials serving on independent regulatory commissions can be protected from being fired for nothing more than a policy disagreement. As many legal commentators have noted, in overturning the 91-year-old precedent Humphrey’s Executor, the Court endangered the independence of such agencies as the FTC, the NLRB, the CPSC, and the EEOC—to name just a few from which Trump has fired commissioners or board members.

But the death of independent agencies should not be considered a fait accompli. The Court’s ruling in Trump v. Slaughter just turned a wonky bill focused on the structure of crypto markets into a live test case for whether Congress will let one party’s White House—present or future—singlehandedly control how every industry in the United States is regulated.

Let’s start with some background: Since the nineteenth century, Congress has provided the leadership of federal regulatory agencies—now roughly two dozen of them—with for-cause removal protections, preventing the president from firing officials except in cases of inefficiency, neglect, and malfeasance in office. Such removal protections reflected lawmakers’ belief that the nation’s problems could be solved by, as the Court explained in Humphrey’s Executor in 1935, the “trained judgment” of experts acting with “entire impartiality” rather than loyalty to the White House and its partisan allies.

In addition to removal protections, Congress frequently structured these regulatory agencies in such a way that no more than a bare majority of their membership would come from any one political party. These partisan-balance requirements were intended to ensure that the agencies would yield better-reasoned, more moderate policy through deliberation, negotiation, and consensus-building; the presence of the minority commissioners would serve as a built-in monitoring system to alert the public if the majority swung too far in any one direction.

By a 6–3 vote, the Court declared in Trump v. Slaughter that for-cause removal protections are “contrary to the separation of powers enshrined in the Constitution.” In doing so, the Court also made partisan-balance requirements a practical dead letter, since a commissioner of a party opposite the president’s can be removed if she votes against the president’s wishes—as Rebecca Slaughter was when President Trump removed her from the Federal Trade Commission.

Quorums as a solution

Slaughter need not be the last word on bipartisan policymaking. Although the Court has ruled that the president must be permitted to remove board members and commissioners at will, Congress is still permitted to structure agencies in ways that disincentivize firings.

One partial solution worth pursuing would be to emphasize and clarify independent agencies’ quorum rules, requiring that bipartisan slates of commissioners are seated before agencies take any actions. As sketched out in a new Stanford Law Review article by University of Minnesota Law School professor Nicholas R. Bednar and myself, commissions’ quorum requirements could be structured such that members from both the Democratic and Republican parties must be in office and must not be recused before the agency may advance any action. Such quorums would ensure that even if members of the minority party are not successful in persuading their colleagues of their policy proposals, they are at least in the room when decisions are being made.

This is not to relitigate Slaughter or to try to restore removal protections the Court just took off the table—that fight is over. Rather, it is to propose a narrow speed-bump into the president’s decision-making. The president may certainly fire commissioners as the Supreme Court has permitted, but doing so in a way that breaks the quorum will simply prevent the agency from acting until the Senate confirms replacements. It is a structural guardrail, not a personnel mandate, and it survives the Court’s reasoning because it never depends on anyone’s job being protected, and thus cannot be said to infringe on the powers the Constitution grants to the president.

The time to try quorums is now

A first test of this quorum proposal could come via the CLARITY Act, an important bill Congress is considering that would regulate the sale and trading of digital commodities, enable tokenized real-world assets, and create a binding classification for determining which assets are commodities and which are securities. These are foundational rules for a multi-trillion-dollar asset class that will determine how capital is raised, held, and transferred.

Yet the CLARITY Act’s enactment would not be the end of the lawmaking process. The bill assigns to the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC)—two independent agencies that Congress structured to be bipartisan—responsibility for promulgating a number of crucial regulations that will make or break digital asset markets.

The CLARITY Act has already passed the House and is poised to come to a vote in the Senate within the next few weeks. Legislators should use it as a test case to determine whether agency independence can still exist in light of Slaughter. Senators should refuse to vote to give these commissions authority over hotly contested issues without amending the bill to ensure that the commissions are subject to quorum requirements mandating the presence of both Democratic and Republican commissioners.

Politics and policy are in independence’s favor

Lawmakers understandably may be afraid to make this move, having watched the huge sums of money the crypto industry has been pouring into politics—some $170 million during the 2024 election cycle and already another $189 million to date in the current midterm cycle. It’s not hard to imagine some political squeamishness. But there are still reasons for legislators from both parties to push for quorum requirements in the CLARITY Act.

First, the desire for bipartisan regulatory agencies is not simply a Democratic wish. The Republican chairman of the committee overseeing the CFTC has acknowledged “the importance of having Democrats and Republicans on the Commission.” Although Democrats would be the beneficiaries of quorum requirements today, Republicans would be the beneficiaries under future Democratic administrations.

Second, Republican control of the White House and Democrats’ minority position represent strengths in this context, because Republicans will bear the blame if the CLARITY Act fails. To be enacted, the bill will presumably need seven Democratic Senate votes and White House support, creating a possible stalemate if the White House refuses to preserve the SEC’s and CFTC’s bipartisan nature as Congress intended them. Republicans could in theory pass the bill without Democratic support—the Senate majority can change the filibuster with a simple majority and pass the bill on partisan lines whenever it chooses—although that seems highly unlikely here. The best bet would be for Republicans to join with Democrats in backing a bill that preserves bipartisan policymaking; uniting behind such a bill, it would not be difficult to override a presidential veto.

Third, the crypto industry will not campaign against legislators who support a clear, durable legal framework for digital assets, albeit with quorum requirements. The industry has little incentive to spend against legislators genuinely pushing for a workable bill.

Although the Supreme Court has made its decision, Congress need not let the six justices have the last word on whether agency independence is permitted to exist. Tightening quorum requirements for independent regulatory agencies is not a perfect solution. But it’s a step worth taking. Legislators who oppose volatile, episodic regulation driven by who happens to control an agency at any given moment should use the CLARITY Act as an opportunity to preserve, at least in a limited way, bipartisan, independent agencies while articulating a blueprint for reforming other commissions in the future.

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Todd Phillips is a consultant and most recently taught law as a professor at Georgia State University. His research focuses on financial regulation and administrative law. He has published in the Stanford Law Review and the Yale Journal on Regulation.