Musk and Ramaswamy's Misreading of Supreme Court Rulings: The Illusion and Reality of Regulatory Rollback

Musk and Ramaswamy's Misreading of Supreme Court Rulings: The Illusion and Reality of Regulatory RollbackElon Musk and Vivek Ramaswamy, two influential figures in the tech and business worlds respectively, plan to utilize recent Supreme Court decisions to dismantle a significant portion of federal regulations. Appointed by President-elect Donald Trump to head the newly created Department of Government Efficiency (DOGE), they believe that the 2022 ruling in West Virginia v

Musk and Ramaswamy's Misreading of Supreme Court Rulings: The Illusion and Reality of Regulatory Rollback

• Elon Musk and Vivek Ramaswamy, two influential figures in the tech and business worlds respectively, plan to utilize recent Supreme Court decisions to dismantle a significant portion of federal regulations. Appointed by President-elect Donald Trump to head the newly created Department of Government Efficiency (DOGE), they believe that the 2022 ruling in West Virginia v. EPA and this year's Loper Bright Enterprises v. Raimondo decision have curtailed federal agencies' regulatory power, creating an opportunity for large-scale deregulation. However, this view is widely contested by legal and regulatory experts who argue that Musk and Ramaswamy significantly misinterpret the Supreme Court rulings, potentially making the elimination of existing regulations far more difficult in practice.

The True Meaning of the Supreme Court Rulings: Restriction, Not Deregulation

In a recent op-ed, Musk and Ramaswamy claimed the Supreme Court rulings indicate that numerous existing federal regulations exceed Congress's delegated authority. Through the DOGE, they plan to present President Trump with a list of regulations to be suspended via executive action, followed by a review and repeal process. They believe this action will "liberate individuals and businesses from unlawful regulations never passed by Congress and stimulate the American economy."

This optimistic assessment is strongly refuted by legal experts. Nicholas Bagley, a University of Michigan Law School professor and administrative law expert, notes that while these cases do limit agency discretion, they do not grant the executive branch additional power to revisit older regulations. Federal agencies still need to follow lengthy administrative procedures to overturn regulations, including issuing new rules to replace old ones, demonstrating the necessity of the changes, and allowing for public comment on the proposed rules. This process is notoriously cumbersome, time-consuming, can take years to complete, and the final outcome remains vulnerable to legal challenges.

Richard Pierce Jr., a law professor at George Washington University, adds: "This is a very cumbersome, very difficult process, and it will likely fail in most cases." This starkly contrasts with Musk and Ramaswamy's vision of simply eliminating regulations.

Loper Bright and West Virginia: Profound Implications for Regulation

• In Loper Bright Enterprises v. Raimondo, the justices overturned long-standing judicial precedent. Previously, courts typically deferred to federal agencies' rulemaking when statutory language was ambiguous. The new ruling means courts will scrutinize agency actions more rigorously, undeniably increasing the difficulty of repealing regulations.

• West Virginia v. EPA curbed the power of federal agencies to address major problems without explicit congressional authorization. While seemingly providing space for regulatory reduction, it also raises the bar for repeal, as any such action would require clearer and more explicit congressional mandate.

Staff Reduction and Regulatory Reform: A Contradictory Strategy

Musk and Ramaswamy also suggest in their op-ed that the number of federal employees reduced should be "proportionate" to the number of regulations repealed, anticipating a smaller workforce needed for future rulemaking and enforcement. Experts deem this short-sighted and misleading. James Broughel, a senior fellow at the Competitive Enterprise Institute, points out that these very staff members are needed to review regulations; significant progress on the massive backlog would require retaining personnel with long-standing experience with those regulations. Cutting them would be counterproductive, delaying or even thwarting regulatory reform.

• Trump, during his first term, also pledged significant deregulation, but this largely involved slowing the pace of new regulations rather than repealing existing ones en masse. A 2019 report by his Council of Economic Advisers estimated that Trump's deregulatory actions would increase US household income by $3100 after 5-10 years, but emphasized the importance of minimizing new regulationsa far cry from Musk and Ramaswamy's envisioned wholesale repeal of existing ones.

The Congressional Review Act: A Limited Path to Repeal

There are, of course, avenues for regulatory repeal. Republican lawmakers can use the Congressional Review Act to overturn regulations issued in the final months of the Biden administration, bypassing the Senate filibuster. This means they only need 50 votes in the Senate to eliminate these new regulations. According to Public Citizen, a consumer advocacy organization, roughly 100 regulations might qualify. However, this targets recently enacted rules, not the vast amount of existing regulations Musk and Ramaswamy aim to eliminate.

Conflicts of Interest and Real-World Considerations

As CEOs of X (formerly Twitter), Tesla, and SpaceX (Musk) and a biotech entrepreneur (Ramaswamy), their interests are directly tied to deregulation. Their criticisms of existing regulations stem largely from their potential impact on their substantial businesses. Musk has repeatedly criticized government regulations, claiming they hinder his companies' development, such as Neuralink's brain-computer interface technology.

In conclusion, Musk and Ramaswamy's interpretation of the Supreme Court rulings is overly optimistic, bordering on misreading. Their plan for economic stimulus through mass deregulation faces significant legal and practical hurdles. Lengthy administrative procedures, the need for specialized personnel, and potential conflicts of interest make their goal challenging to achieve. Their initiative might ultimately prove counterproductive, leading to regulatory chaos and potentially hindering economic growth. Instead of relying on simplistic mass repeal, a focus on more effective and legally sound regulatory reform would be more prudent.