Joshua McKarcher · August 2008
76 GEO. WASH. L. REV. 1342 (2008)
In Motor Vehicle Manufacturers Ass’n of the United States v. State Farm Mutual Automobile Insurance Co., the Supreme Court famously imported D.C. Circuit Judge Leventhal’s requirement for agencies to conduct a “reasoned analysis” when changing course in administering a statute by way of informal rulemaking. In legitimating this form of “hard look” review in State Farm, the Supreme Court did not adopt the position—made by Justice Rehnquist in dissent—that a change in political philosophies concomitant with the coming to power of a new administration can be sufficient justification for a change in agency policy.
Though the subsequent case Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. seemingly allows political philosophy to play a part in an otherwise well-reasoned policy “swerve” based on reasonable interpretations of ambiguous statutory commands, the Court has never fully endorsed Justice Rehnquist’s essential formulation that “[a] change in administration brought about by the people casting their votes is a perfectly reasonable basis for an executive agency’s reappraisal of the costs and benefits of its programs and regulations.” The Court should do so now.
Academic debate rages on about the validity of the judicially created “hard look” rule in light of the judicial-review standards of the Administrative Procedure Act (“APA”). For example, a recent edition of The George Washington Law Review featured an article and two replies discussing the Court’s rulings in Chevron and Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc. and the prospects for a long-sought “Vermont Yankee II” that would relax, among other things, federal courts’ imposition of substantive requirements beyond those required under the APA.
This Essay focuses on one such substantive requirement: State Farm’s “reasoned analysis” standard and the majority’s disregard of the political-philosophy justification advanced by Justice Rehnquist’s State Farm dissent. A change in political philosophies accompanying a change in presidents may at times be a sufficient basis for a reversal of a prior administration’s interpretations of broad, vague, or ambiguous statutory commands, beyond just the more limited interpretive deference accorded under Chevron. In the words of the APA, it is neither “arbitrary” nor “capricious,” nor necessarily an “abuse of discretion,” for administrative agencies “to assess administrative records and evaluate priorities in light of the philosophy of the administration.”
Requiring the version of “reasoned analysis” the State Farm majority contemplated to disprove arbitrariness and capriciousness—or, alternatively, to prove a rational relation between facts and policy—exceeds the APA’s demands. The requirement artificially constricts the modes by which an agency administering broad, vague, or ambiguous statutory commands can prove that it is moving permissibly within and among policy choices Congress chose not to make. This, in turn, disallows a newly elected president either to respond nimbly to the democratically expressed will of the people—or just to act in his or her best judgment as endorsed by the electorate—on a given issue that admits of more than one valid policy answer not given explicitly by legislation.
Part I analyzes applicable sections of the APA. Part II traces the D.C. Circuit case law giving rise to State Farm’s “reasoned analysis” formulation. In particular, this Essay relates the genesis and history of the “reasoned analysis” standard in the D.C. Circuit to evidence that its lineage does not support the application given it by the Supreme Court in State Farm. Part III discusses the imported “reasoned analysis” standard as articulated in State Farm, and the Chevron doctrine that was announced the following year. Part IV concludes with arguments for rescinding the “reasoned analysis” requirement—at least as given effect by the State Farm majority—in reviewing swerves in agency policy resulting from changes in control of the executive branch.
