After a bruising and highly partisan confirmation fight, Justice Brett Kavanaugh took his seat on the Court as the term began. Replacing the predictably unpredictable Justice Anthony Kennedy, Justice Kavanaugh seemed poised to move the Court in a decidedly rightward direction. But looks can be deceiving. In a few high-stakes cases and, especially, petition rejections and other votes on the “shadow docket” (as opposed to fully briefed and argued cases), Kavanaugh demonstrated a dynamic — not wholly originalist/​textualist or “conservative” — jurisprudence. Notably, he was the swing vote to allow a questionable antitrust lawsuit to proceed against Apple.

And Kavanaugh has tried to keep a low and agreeable profile, easily becoming the justice most often in the majority (over 90 percent of the time). He also showed how different he was from his fellow Trump appointee Justice Neil Gorsuch, who is rapidly becoming a libertarian darling. Kavanaugh actually aligned about as much with Justice Elena Kagan as with Gorsuch.

While Chief Justice John Roberts recently has become, by some metrics, the swingiest member of the bench, there could in future be a reinvigorated conservative block that comes to dominate the Court — especially if President Trump is given the opportunity to fill another seat on the bench. Yet for all the doomsday prophesying from progressive court-watchers, eight cases saw one “conservative” justice cast the deciding vote alongside his “liberal” colleagues (four of them involved Justice Gorsuch, in criminal procedure cases). Indeed, of the twenty 5–4 decisions this term, only seven had a “conventional” split of conservatives over liberals. In a more typical term, with more high-profile cases with ideological salience, perhaps we’ll see the conservative bloc flex its muscle, but not this year.

Cato filed amicus briefs in 16 cases that the Court heard in the 2018–2019 term, including whether Congress may delegate to the Attorney General the authority to modify sex offender registration requirements (implicating the nondelegation doctrine), to the validity of a state law that refused liquor licenses to people failing to satisfy in-state residency requirements (in potential conflict with the dormant Commerce Clause). Mirroring last year’s 11–3 win-loss count, Cato’s side prevailed at a 12–4 clip.

Overall, the term had its fair share of winners and losers. Among the winners were American Legion v. American Humanist Association and Knick v. Township of Scott. In the former, a seven-justice majority held that a WWI memorial cross in a municipal park did not violate the Establishment Clause (“separation of church and state” in not wholly accurate layman’s terms). In the latter, the Court ruled that challenges to state or local eminent domain actions could be brought in federal court, without claimants first having to exhaust their state-court options. Both were clear victories for liberty and speak to the two newest justices’ commitment to our constitutional order. Among the losers was Gamble v. United States, in which the Court upheld the “separate sovereigns” doctrine that allows both state and federal courts to convict an individual for the same underlying action.

Here’s the full breakdown, in the order the opinions arrived:

Winning side (12): Weyerhaeuser Company v. U.S. Fish & Wildlife Service; Timbs v. Indiana; Garza v. Idaho; Frank v. Gaos; Merck Sharp & Dohme Corp. v. Albrecht; Return Mail, Inc. v. U.S. Postal Service; Manhattan Community Access Corp. v. Halleck; American Legion v. American Humanist Association; Knick v. Township of Scott; Iancu v. Brunetti; Tennessee Wine & Spirit Retailers Association v. Thomas; Kisor v. Wilkie.

Losing side (4): New Prime, Inc. v. Oliveira; Gamble v. United States; Gundy v. United States; Mitchell v. Wisconsin.

Next term is shaping up to be an exciting one. This fall, the Supreme Court will hear cases striking at the heart of the culture war — and others that, though less controversial, are of great national import. The Court will decide whether to apply to the states’ the Sixth Amendment’s guarantee of a unanimous jury verdict for criminal convictions, if Title VII of the Civil Rights Act protects transgender and homosexual employees from gender- and sexual-orientation-based discrimination, and the constitutionality of New York City’s ban on transporting locked and unloaded handguns. Unfortunately, the Court declined to take up a case that could have limited the president’s congressionally delegated power to impose tariffs in the oft-flimsy name of “national security.” But in light of Justice Samuel Alito’s concurrence in Gundy – indicating a willingness to join his dissenting colleagues in reexamining the Court’s expansive reading of Congress’s delegation of legislative power — we’re hopeful that the Court changes course at some point. But for now, we must continue to wait.

I’ll have more to say in future commentary, but if you’d like to learn about all these cases and trends, from the perspective of Cato-friendly scholars and lawyers, register for our 18th Annual Constitution Day Symposium, which will be held September 17 (Constitution Day). That’s also when we’ll be releasing the latest volume of the Cato Supreme Court Review, the editing of which has now passed to my colleague Trevor Burrus as I rediscover what it’s like to use August for vacation and other summer fun rather than checking citations and turning galleys.

A constitutional wrong to which there is no remedy? For decades the Supreme Court has held severe partisan gerrymandering to be a violation of equal protection, but for just as long it has proved unwilling to convert that holding into any sort of solid remedy. In last year’s Cato Supreme Court Review I described the resulting situation as the “ghost ship of gerrymandering law,” drifting on as precedent, yet abandoned by a majority crew.

Today in Rucho v. Common Cause and Lamone v. Benisek Chief Justice Roberts as expected recruited the votes of newcomers Neil Gorsuch and Brett Kavanaugh for the position identified with Justices Sandra Day O’Connor and Antonin Scalia that gerrymandering is a political question to which the Constitution provides no judicial remedy. 

If partisan gerrymandering is a substantial evil worth fighting — and I believe it is — we should now get serious about finding that remedy through other means. The Constitution’s Elections Clause provides that “The Times, Places and Manner of holding Elections for Senators and Representatives, shall be prescribed in each State by the Legislature thereof; but the Congress may at any time by Law make or alter such Regulations,” and in fact Congress has in the past prescribed to the states standards for districting. These include standards on compactness, a vital principle of good districting that all by itself would disallow many of the most garish gerrymanders by which U.S. House members reach the Capitol. Countering the gerrymandering of state legislatures is a tougher challenge, but even in states without a process for ballot initiatives it is a natural issue for reformist governors and others who run in non-districted races. 

Around the country, machine politicians must be thinking they’ve got a free hand to draw maps even worse than the ones last round. We shouldn’t let them. 

Democratic candidates for president gathered last night to debate, and moderators asked, what would you do to address the number of people crossing illegally? The discussion devolved into the question of whether crossing should remain a crime (punishable by prison time) or just a civil infraction (punishable by deportation). No one stated the obvious: that Congress should make it legal, not to trek through Mexico and swim the Rio Grande, but to board private U.S.-bound airplanes and come to the United States to work.

According to the Department of Homeland Security, the average Central American is paying north of $8,000 to make it to the U.S.-Mexico border where they are brutalized in Mexico and in the United States. Round-trip airfare from El Salvador, Guatemala, and Honduras is under $300. People are dying on the way to make that illegal crossing. When will politicians step up and say clearly, “We think it should be legal to travel to America.” 

Sen. Klobuchar came the closest by arguing for the “the economic imperative” to allow immigrant “workers in our fields and in our factories.” But no one made the explicit connection between the availability of visas—which allow noncitizens to board U.S.-bound flights—and illegal crossings. It is not that the civil v. criminal debate isn’t important. It is. But it ignores everything up to the moment where a father makes a fateful decision to jump into a river and cross illegally.

For nearly a century and a half, it was not illegal to travel to the United States (unless you were Chinese after 1882). Immigration restrictions otherwise exlusively focused on criminals, valid public health concerns, and people likely to end up on public welfare. Cato’s first policy analysis on immigration from 1981 argued that the United States should return to this system. The author wrote, “In all the debate over immigration, no one seems to be considering the possibility of returning to America’s traditional open immigration policy.”

The Democratic candidates’ debate has shown how little has changed. The reality of the matter is this. By the end of 2019, nearly 730,000 immigrants from Central America’s Northern Triangle will enter Border Patrol custody. But the U.S. government will issue fewer than 10,000 work visas to nationals of those countries. This disconnect is the cause of the immigration crisis. 

Strangely, former-Congressman Beto O’Rourke ended up tacitly defending the continued criminalization of illegal crossing (for anyone except asylum seekers), yet his immigration plan contains the most explicit declaration in support of a free market in international labor. His plan contains a line that states that he would “increase the visa caps so that we match our economic opportunities and needs … to the number of people we allow into this country.” This seems like a round-about way of saying: let supply and demand function in international labor markets. Perhaps he forgot about that part.

The government doesn’t even need to issue visas to everyone who could conceivably want to come in order to resolve this problem. It just needs to issue enough visas that people can see that legal immigration is the easier path in the future than crossing illegally. The goal should be to lower the cost of legal immigration to at least the point that it is less costly to follow that path than to come to the border.

In a piece for The Bulwark last month, I argued that the government should charge immigrants a fee that is less than what they would pay to smugglers to allow migrant workers to come to the United States. This is essentially what the folks at IDEAL Immigration have proposed. This would cover any fiscal costs associated with the immigrants’ arrivals, bankrupt smugglers, and cure the illegal immigration problem.

Such a plan would increase revenues. Yet the bipartisan consensus in the House and Senate right now is to spend billions more on the border detention camps. If immigrants had a viable route to come here legally, U.S. taxpayers wouldn’t need to spend billions every year to fund detention camps, nor would immigrant children be forced to go without toothbrushes and soap while detained. How many more dead children will it take to make politicians decide that this is better?

Sometimes it’s possible to lose in name only. Consider, for example, Cato’s position in Kisor v. Wilkie, which the Supreme Court yesterday decided.

By a 5 – 4 vote, the Court upheld the Auer doctrine, or binding judicial deference to an agency’s interpretation of its own regulation. Only four Justices actually validated the Auer doctrine; Chief Justice Roberts provided the fifth vote solely out of respect for precedent. In a brief supporting the petitioner, Cato had argued that the Court should overturn Auer, so technically our position lost.

Nevertheless, the opinion of the Court “reinforced” and “expanded on” the doctrine’s limits. In Part II.B, Justice Kagan set forth several “markers” to guide lower courts regarding the boundaries of Auer deference. In practice, these limits gut the doctrine. As rightly observed by Justice Gorsuch, Auer emerges “maimed and enfeebled.” And because Auer deference has been rendered impotent, opponents of the doctrine effectively “won,” even though we officially “lost.”

So, how did the Court reduce Auer deference to a “paper tiger”? Justice Kagan set forth three big limitations.

The first is a requirement for courts to discern whether the regulatory text is ambiguous. While it might seem obvious that judges should ensure that a legal text is ambiguous before deferring to an agency’s interpretation, courts routinely skipped any meaningful textual analysis before assuming a deferential posture under the Auer framework. In an empirical study, I found that circuit courts failed to meaningfully examine the regulatory text about 35 percent of the time when they applied the Auer doctrine over a 15-year period. The upshot is that there’s a lot of room for courts to improve their craft when it comes to reviewing regulatory interpretations.

Kisor’s second limitation on Auer deference is a requirement that an agency’s regulatory interpretation reflect agency expertise. I expect that this “marker” on Auer’s domain will have the greatest influence on controversies over how to interpret an agency’s procedural regulations. After all, courts are more expert than agencies where due process is implicated. As a related aside, it bears noting that Kisor pertained to a dispute over the regulatory term “relevance” in an evidentiary context, which seemingly rests squarely in the wheelhouse of judicial expertise. Justice Kagan, however, did not draw this connection.

The third significant limitation on Auer was Kagan’s concession that binding deference is “rarely” warranted when an agency has changed its regulatory interpretation. This is huge; by itself, this call for interpretive consistency would have provided a mortal wound to the Auer doctrine. If a regulatory provision is of any consequence, and if it has existed for longer than one presidential administration, then there are vanishingly small odds that the agency’s interpretation has remained consistent. By holding that these interpretations would “rarely” achieve deference, the Court performs most of the work that goes into “enfeebling and maiming” the Auer doctrine.

Today’s unsung hero is the Solicitor General of the United States, Noel Francisco. Justice Kagan didn’t come up with these “markers” on her own. Rather, she borrowed them from the SG’s brief. As I previously explained, the SG’s unusual Kisor brief asked the Court to check the Auer doctrine, even though such a reform would diminish the government’s power. During oral arguments, Justice Kagan seemed concerned about the government’s anti-Auer argument, and she questioned in passing whether the petitioner and government were sufficiently adversarial. Given these apparent reservations, I’m a bit surprise she wholesale adopted the government’s arguments. In any case, the Solicitor General deserves kudos.

As the Court often does, in Kisor v. Willkie, it made a big correction in an important legal area without formally overruling a weak or misapplied precedent. All nine justices agreed that courts need to work harder to ensure that a regulation truly is ambiguous before giving the agency re-interpreting it any sort of deference.

In other words, the Court limited the number of cases where judges defer to agencies, while setting out standards for evaluating those cases that boil down to “when the agency is correct and brings its expertise to bear, having considered the reliance interests of those being regulated” rather than just making legal or political judgment calls willy-nilly. That sounds like reining in the administrative state!

At first blush, Justice Neil Gorsuch’s magisterial opinion that concurred only in the judgment (joined by three colleagues), which would’ve thrown out the Auer deference doctrine altogether, reads like a dissent in all but name. But Chief Justice John Roberts (who joined the majority opinion, largely on stare decisis grounds), echoed by Justice Brett Kavanaugh (who joined Gorsuch’s concurrence), shows that in practice the distance between the two isn’t all that great. And this particular case illustrates that point, given that the lower-court opinion is vacated because all nine justices agree that it didn’t rigorously vet what the agency did.

At bottom, Kavanaugh makes the perfect analogy that sums up the unanimous Court’s position: “Umpires in games at Wrigley Field do not defer to the Cubs manager’s in-game interpretation of Wrigley’s ground rules.” Administrative agencies are now on notice that it’s not “anything goes” when they decide to rewrite their own rules, that judges will hold their feet to the statutory fire.

In short, while Kisor didn’t overturn Auer, it represents a pretty good start at limiting executive-agency overreach.

See here for more background and to read Cato’s brief in the case, which was joined by superstar law professors Jonathan Adler, Richard Epstein, and Michael McConnell.

Earlier this month New York State enacted a new rent regulation bill. The bill applies to the entire state but has a significant impact on New York City where 2.4 million people live in close to a million regulated apartments. The City’s two regulatory frameworks, rent control and rent stabilization, differ on which units qualify and the rules that govern rent increases, but in general they both cap the amount that a landlord can increase rents each year leading to rents that are much lower than the market rate. The new law creates permanent regulations that severely limit the ability of landlords to raise rents in special circumstances (for example, after tenants move out or landlords invest in building improvements) and to deregulate units.

As my colleagues have argued time and time again, rent regulations are counterproductive. Though the rules aim to address a lack of affordable housing, setting the rent below market rates creates a supply shortage that exacerbates the problem. Traditionally, economists have understood rent control to benefit current tenants, who pay lower rents, at the expense of future tenants, who have more difficulty finding affordable apartments.

This view accurately captures the future supply shortages created by rent controls but misses the negative impact the rules have on current tenants. In the winter 2018–2019 issue of Regulation, Richard McKenzie and Dwight Lee explain how current renters are made worse off by the strategies landlords use to respond to the decreased rent and reduced competition as demand outpaces supply. Without any rent regulations, landlords balance the rent they receive with the features and amenities they offer to tenants, including things like maintenance and air conditioning, in order to compete for prospective tenants. Limiting the amount landlords can charge and the competition they face incentivizes them to reduce the amenities and features they offer.

In the longer-term, this means landlords may allow apartments to deteriorate and newly built apartments will be of lower quality. Even in the short run, landlords can institute new rules (such as limiting the number of tenants in each unit), withhold maintenance, remove or restrict access to amenities, or convert units to condos to offset their lost revenue. The value of the diminished apartment quality nullifies tenants’ reduction in rent and, accounting for the decrease in quality, tenants may end up paying a higher effective rent than they would have paid without rent controls.

A shortsighted response to this could be to prohibit these sorts of strategies. But this discounts the ability of landlords to find creative ways to recoup their losses. They can always create new fees (such as charging for repainting or the use of amenities like a pool or gym) or find opportunities to reduce costs, even in ways that no regulation can address (for example, saving time by being less responsive and helpful to tenants). Even if a particular prohibition does succeed in limiting landlords’ ability to make up for their reduced rent revenue it simply further compounds the supply shortage.

Proponents of rent controls don’t anticipate both the supply shortages the rules create and the ability of landlords to make up for lower revenues by reducing quality. The best way to address the need for affordable housing is to loosen regulations to allow more housing units to be built and encourage increased competition, not to introduce more counterproductive regulations.

Written with research assistance from David Kemp.

This morning, in a win for wine-drinkers and freedom-lovers alike (but I repeat myself), the Supreme Court struck down a heavily restrictive Tennessee law that prevented anyone but longtime state residents from getting liquor licenses. The provisions required applicants for an initial license to have lived in the state for two years and for a renewal of that to reside for 10 years, and prevented corporations from getting licenses unless all stockholders were residents. This hurt both would-be small business owners and large distributors like Total Wine & More (one of the parties; full disclosure: I have reserve status in its loyalty program).

It’s terrific that a lopsided majority of justices (7–2) thus preserved economic liberty and interstate commerce, as against a flawed claim that the 21st Amendment (which repealed prohibition and gave states the power to regulate the importation of alcohol) somehow gives states the power to impose otherwise unconstitutional business regulations. As Justice Samuel Alito put it in his majority opinion, Section 2 of the 21st Amendment “is not a license to impose all manner of protectionist restrictions on commerce in alcoholic beverages.”

To put a finer point on it, states’ power to regulate alcohol doesn’t include the power to protect established businesses against newcomers that want to serve Volunteer State consumers. When a state law discriminates against interstate commerce or favors in-state economic interests over out-of-state interests, the Supreme Court has generally struck down the statute without further inquiry. This fundamental rule stems from the Framers’ concern that, left unchecked, states would enact commercial regulations favoring their own residents at the expense of non-residents. To prevent that type of differential treatment between state residents and non-residents, the Framers adopted both the Commerce Clause and the Privileges and Immunities Clause. As the Court has recognized, the clauses have a “mutually reinforcing relationship” that ensure citizens of their right to access the markets of other states on equal terms.

In legal terms, the negative or “dormant” Commerce Clause means that, just as Congress has the power to regulate (“make regular”) interstate commerce, states can’t interfere with that commerce. Now, Justice Neil Gorsuch (here joined by Justice Clarence Thomas) has other views, being skeptical of this unwritten or implied constitutional doctrine — and actually that’s the only constitutional jurisprudence on which I’ve ever found myself in disagreement with him. (Here Gorsuch adds a special solicitude for alcohol, given state practice after ratification of the 21st Amendment.)

In any case, the justices can now have a gulp of wine ahead of tomorrow’s climactic end to an otherwise low-key term. I, meanwhile, am off to Total Wine, which coincidentally just sent me a marketing email.

The case is Tennessee Wine & Spirit Retailers v. Thomas. See here for more background and to read Cato’s brief.