Supreme Court Ruling Puts Independent Commissions on Notice

The Supreme Court's recent decision in Trump v. Slaughter has far-reaching implications for executive power and independent commissions. The court ruled that the Federal Trade Commission (FTC) exercises executive power, rendering its members subject to presidential control.

This ruling contradicts traditional notions of independence, which include expertise, bipartisan composition, staggered terms, and institutional continuity. However, the court's decision in Trump v. Cook preserved an exception for the Federal Reserve (Fed), treating 'for cause' as a substantial limitation on presidential removal power.

The Fed's protection is based on its historical lineage and the importance of shielding monetary policy from political interference. However, this protection comes with a qualification: Congress may not add regulatory powers 'attenuated from monetary policy.'

Congress now faces the challenge of clarifying what constitutes cause for removal and defining the Fed's powers in relation to its existing portfolio. A balanced approach is needed to protect monetary policy while also ensuring accountability through reporting and transparency requirements.