The New York Times highlighted Republican efforts to prevent the Consumer Financial Protection Bureau from functioning, in part by leveraging a recent DC Circuit Court of Appeals' decision that drastically limits the president's power to make recess appointments. But the Times understated the decision's role in continuing GOP obstructionism, even as the corporate lobby appears ready to take advantage of it to undo consumer and labor protections.
In Noel Canning v. National Labor Relations Board, a panel of the extremely conservative judicial circuit responsible for reviewing checks on corporate power issued a decision that rolled back decades of case law on presidential recess appointments. Although the case was nominally about one company's challenge to an adverse NLRB decision through a claim that the recess appointments of two board members were illegitimate, the ensuing opinion was so overbroad that the threat to other recess appointments - such as that of the current CFPB director - was immediately apparent.
In reference to Noel Canning's effect on the CFPB, the Times editorialized:
The bureau cannot operate without a director. Under the Dodd-Frank law, most of its regulatory powers -- particularly its authority over nonbanks like finance companies, debt collectors, payday lenders and credit agencies -- can be exercised only by a director. Knowing that, Republicans used a filibuster to prevent President Obama's nominee for director, Richard Cordray, from reaching a vote in 2011. Mr. Obama then gave Mr. Cordray a recess appointment, but a federal appeals court recently ruled in another case that the Senate was not in recess at that time because Republicans had arranged for sham sessions.
That opinion, if upheld by the Supreme Court, is likely to apply to Mr. Cordray as well, which could invalidate the rules the bureau has already enacted. The president has renominated Mr. Cordray, but Republicans have made it clear that they will continue to filibuster, using phony arguments to keep the agency from operating.
By declaring hundreds of recess appointments - including those made by Reagan and both Bushes - no longer valid under its new interpretation of the Constitution, the court of appeals directly undermines agencies that rely on recess appointments because of Republican senators' refusal to consider nominees. Both the CFPB and the NLRB have been targets of this Republican obstructionism, the latter incessantly.
As revealed in a recent memo, the U.S. Chamber of Commerce sees quite clearly the decision's potential to nullify consumer and labor protections it was unable to defeat legislatively. Indeed, the Times is underselling the importance of Noel Canning to right-wing strategies to neutralize agencies such as the CFPB and NLRB, which are crucial curbs against corporate abuses. In the memo, the Chamber advises businesses to wield the decision as the means to ignore or challenge NLRB decisions, despite the fact that the decision itself is not yet in effect, will almost certainly be appealed, and only technically applies to the one disgruntled company that brought the lawsuit. As reported by The Wall Street Journal:
The U.S. Chamber of Commerce is advising companies to try to reverse rulings the National Labor Relations Board made against them in the past year, following a court decision that has undermined the federal panel.
The chamber's push, outlined in a memo the business trade group began distributing to its members Wednesday, is the latest fallout from last week's federal court ruling that voided President Barack Obama's three recess appointments to the five-slot labor board.
The U.S. Court of Appeals for the District of Columbia Circuit ruled that an NLRB decision against soda bottler and distributor Noel Canning was invalid because the three board appointees were made outside of the recess window the court believes is stipulated in the Constitution.
The chamber and labor lawyers this week are telling other parties that they, too, may be able to use the ruling to reverse NLRB decisions they don't like. The board supervises union elections and referees disputes in private-sector workplaces.
Companies have already started to take the Chamber's advice, one going so far as to ask the Supreme Court to approve their efforts. Egged on by right-wing media and conservative think tanks, it is likely that even more companies will use Noel Canning as an end-run around not only the NLRB, but the CFPB as well. The radical DC Circuit opinion is enabling the worst tendencies of a Republican caucus that refuses to legislate and the conservative nature of the circuit only validates Republicans' refusal to allow moderate picks for this crucially important court.
Appointment filibusters strengthened by judicial filibusters: the Republican Party's refusal to allow the President to govern continues. The media shouldn't underestimate the significance of Noel Canning to this democracy-eroding effort. The Chamber isn't.