July 10, 2018 / 1:50 AM / 5 months ago

Breakingviews - Trump's court pick a deregulatory gift to business

U.S. President Donald Trump introduces his Supreme Court nominee judge Brett Kavanaugh in the East Room of the White House in Washington, U.S., July 9, 2018. REUTERS/Leah Millis

NEW YORK (Reuters Breakingviews) - President Donald Trump has given a deregulatory gift to business with his nominee for the Supreme Court. As a federal judge, Brett Kavanaugh has ruled against the Consumer Financial Protection Board and net neutrality. His staunch conservatism ensures stiff Democratic resistance. But if Republican numbers prevail, he can tilt the judicial balance to the right for a generation.

Kavanaugh’s pedigree and conservative judicial record won over Trump, probably more than his stint as staff secretary to former President George W. Bush. The Yale law school alumnus has been a judge on the District of Columbia Circuit of the U.S. Court of Appeals since 2006, and opined on several issues that could come up at the nation’s top court.

Businesses will cheer his decisions against regulatory bodies. In a 2016 opinion for a three-judge panel of the D.C. court, Kavanaugh wrote that the CFPB’s structure was unconstitutional because it gave the director unchecked power, and that the president had the authority to fire the director at will. In January, the full appeals court upheld the legality of the CFPB structure and said the director could be fired only for cause. Kavanaugh dissented, arguing independent agencies should be structured like the Securities and Exchange Commission.

Kavanaugh also wrote a dissent against a court decision to uphold the Obama administration’s net neutrality rules requiring internet service providers to treat all content equally, arguing that the Federal Communications Commission had sidestepped Congress. Trump’s FCC chairman, Ajit Pai, scrapped those rules in December. Kavanaugh has also written several opinions critical of the Environmental Protection Agency, arguing, for example, that the agency had to consider the costs of its regulatory measures.

The Washington, D.C. native has twice rejected challenges to Obamacare, leading some conservatives to question whether he would continue to uphold the legislation, as Chief Justice John Roberts has done. Yet Kavanaugh seems likely to be a more-reliable conservative than Anthony Kennedy, the retiring justice who voted with liberals on issues including same-sex marriage. 

The intriguing question is what happens if Kavanaugh has to rule on Trump himself if an impeachment battle reaches the Supreme Court. As an aide to independent counsel Kenneth Starr in the 1990s, Kavanaugh argued that then-president Bill Clinton could be impeached for misleading the public. But in a law review article in 2009, Kavanaugh wrote that it was not in the public’s interest to indict a sitting president.

In the short term, the bigger question is whether Kavanaugh can secure a majority of Senate votes in order to be confirmed. If he can, businesses may have a new friend for life.

Breakingviews

Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.


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