Noel Canning, Liberty, and the Coase Theorem

Conservatives have been celebrating Noel Canning, the recent Supreme Court decision on recess appointments, because President Obama lost 9-0. But in reality the case was a loss both for liberty and the rule of law. While the result was unanimous, the reasoning in Justice Stephen Breyer’s five-person majority dramatically diverged from Justice Antonin Scalia’s four-person concurrence.  And it is the reasoning, not the result, that may shape our constitutional future.  Justice Breyer’s majority opinion elevates practices of the President and Congress over the original meaning of the Constitution.  Adoption of Breyer’s principle of constitutional interpretation threatens our liberty.

The Recess Appointment Clause provides: “The President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” Breyer’s majority opinion permitted the President to make recess appointments during intrasession recesses, not only at the end of the congressional session, and to fill vacancies that happen at any time, not only vacancies that happen during recesses.  Those holdings provide the President with potentially substantial recess appointments power, assuming that the Senate in fact takes intrasession recesses.

I will leave to my co-blogger Mike Rappaport, the leading expert on the Recess Appointment Clause, who is heavily cited in the concurrence, to discuss the details of interpretative disputes.  I want to focus instead on the majority’s enthusiasm for allowing the political branches to reach accommodations among themselves that displace the better interpretation of the Constitution. I say better interpretation, because while the majority contends that the meaning of both “ recess” and “may happen” was ambiguous, it did not argue that the meaning it gave to these terms was the best interpretation as an original matter.  And I think any reasonable reader of the two competing opinions would reach the conclusion that Scalia’s interpretation was better.   It was the practices of the branches, not the language of the Constitution, that did the heavy lifting for the majority.

Let us assume that the majority was right that recess appointment practices accepted by the political branches through much of recent  history differed from the better reading of the Constitution. (As Mike Rappaport has shown, this claim is, in fact, largely false.)  The problem with making  political accommodations the lodestar of the separation of powers can be understood by considering the famous Coase theorem.  The Nobel prize-winning economist Ronald Coase showed that, in the absence of transactions costs, the initial assignment of property rights would not affect the outcome – the rights would either remain with or be transferred to the user who values them most highly.  In my academic work, I have suggested that the Coase theorem has similar implications for accommodations among political institutions.  Thus, unless the original distribution of powers is policed, rights will tend to accrue to the political branch that puts the highest political value on them.

One might think such accommodations offer an advantage for political efficiency.  But, as the Court has long recognized, the separation of powers by dividing federal authority into its originally defined spheres is designed to protect liberty, not promote efficiency.   Permitting Coasean bargains is a threat to liberty.  If the branches can make accommodations (i.e., implicit deals) they can aggrandize the sum of their powers.  In this case of expanding the recess appointments power, the President gets most of what he wants—a capacious, even if not unlimited, recess appointments power, and the Senate avoids accountability for voting on some controversial nominees.

Requiring the Senate to confirm nominees provides an important check on the unilateral power of the President to choose unqualified or unrepresentative subordinates.  Expanding the recess appointment power weakens that check.  But the President may at times be more interested in this power than the Senate is in keeping its own power over confirmation. The power of confirmation does not offer much political return and often may require uncomfortable votes. Thus, at times the Senate might not fight hard to retain is full confirmation authority and instead cede a more capacious recess appointment authority to the President.

Justice Breyer’s endorsement of political practices as an important method for resolving constitutional disputes is a threat to liberty that transcends this case.  The opinion permits the political branches to rewrite the Constitution in their interest, not ours.  And it is the people, not the politicians, who ordained the Constitution.  The Supreme Court needs to speak for us, not them.