Marcantonio and Wagner on the NLRB’s Independence
Everyone should peruse the Congressional Record more often.
“From these facts, by which Montesquieu was guided, it may clearly be inferred that, in saying ‘There can be no liberty where the legislative and executive powers are united in the same person, or body of magistrates,’ or, ‘if the power of judging be not separated from the legislative and executive powers,’ he did not mean that these departments ought to have no PARTIAL AGENCY in, or no CONTROL over, the acts of each other.” - Federalist No. 47
Last month, the Supreme Court’s conservative majority appeared to tee up overturning Humphrey’s Executor with its stay in the case Trump v. Wilcox, where National Labor Relations Board member Gwynne Wilcox and others are suing over being illegally fired by Trump.
The unsigned decision asserts that the president “may remove without cause executive officers who exercise that power on his behalf, subject to narrow exceptions recognized by our precedents” and suggests the NLRB and MSPB “exercise considerable executive power.” The Fed, on the other hand, “is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.” (Read Harold Meyerson for more on that.)
Justice Kagan, in her charged dissent,1 writes that “Congress created [independent agencies], though at different times, out of one basic vision. It thought that in certain spheres of government, a group of knowledgeable people from both parties—none of whom a President could remove without cause—would make decisions likely to advance the long-term public good.”
The legislation that would eventually be known as the National Labor Relations Act, or Wagner Act, was introduced by Senator Robert Wagner, D-New York, in February of 1935, although it was based on prior efforts.
Interestingly, the text of Wagner’s original draft (pgs. 2368-2371 of the Congressional Record, vol. 79) did not explicitly protect members of the NLRB from arbitrary dismissal. But it would have established the board “as an independent agency in the executive branch of the Government.”
And on March 13, 1935, Wagner told the House Committee on Labor that he “cannot urge too strongly that the National Labor Relations Board should be maintained as an independent agency of the Government.”
“For years lawyers and economists have pleaded for a dignified administrative tribunal, detached from any particular administration that happens to be in power, and entitled to deal quasi-judicially with issues with which the courts have neither the time nor the special facilities to cope. With such a tribunal in the offing, its integrity should be preserved,” he stated.
As thankfully preserved in the Congressional Record and assorted House reports, the 1935 debate over whether the NLRB should be an independent agency shows that in explicitly stating NLRB members should be protected from arbitrary dismissal, Congress was actively responding to Humphrey’s Executor and Schechter. Congress was self-consciously exerting powers it had used many times before by trying to maintain a degree of separation between the state’s levers of economic management and transient partisan whims. A separation now seemingly threatened by the Supreme Court’s majority.
In a rare in-person appearance,2 Secretary of Labor Frances Perkins argued before the House Committee on Labor that “the Board should be established in the Department of Labor” rather than as an independent agency (House Report No. 969), mainly on the grounds that it would be more efficient. While at first sympathetic, Congress would eventually reject that proposal following a spirited argument by New York Representative Vito Marcantonio (whom I will quote at length shortly).
Then chairman of the National Labor Relations Board3 Francis Biddle also critiqued Perkins’ argument, writing in a letter to the House committee that “where Congress has defined a policy and created an administrative board to carry out that policy, it has with marked consistency recognized that the board so created should be appointed for comparatively long terms of office and be free of control by the executive departments or by any particular administration” (ibid). Biddle explicitly compared the NLRB to the Interstate Commerce Commission, the FTC, the Communications Commission, and the Reconstruction Finance Commission, as well as the SEC and National Mediation Board.
On June 19, 1935, in a lengthy exchange before the House, Marcantonio defended the constitutionality of the NLRA from its conservative critics,4 namely Howard Smith of Virginia and John Hollister of Ohio. With A.L.A. Schechter Poultry Corp. v. United States, or Schechter, just decided and large swaths of the NIRA freshly unconstitutional, supporters of the NLRA faced accusations that it was similarly an illegitimate aggrandizement of the commerce clause.
And, with Perkins’ amendment to place the NLRB within the Department of Labor similarly before the House, Marcantonio had to argue, with frequent references to Congress’ past actions, that necessity dictated the NLRB be an independent agency:
“I should have thought that even without regard for the past history of the National Labor Relations Board and the testimony before this committee, both of which seem to me compelling upon this point, precedent alone would have induced the establishment of the Board as an independent agency. The Board is to be solely a quasi-judicial body: with clearly defined and limited powers. Its policies are marked out precisely by the law. That such an agency should be free from any other executive branch of the Government has been the recognized policy of Congress. Ready examples are the Interstate Commerce Commission, the Federal Trade Commission, the Communications Commission, the Securities and Exchange Commission, the National Mediation Board, and agencies that are even less judicial in character, such as the Federal Housing Administration and the Reconstruction Finance Corporation.”
Reflecting the times somewhat, Marcantonio also explicitly argued that placing the NLRB under the Department of Labor would make people suspect it was biased towards workers’ interests, rather than being a neutral board capable of hosting impartial arbitrations and ruling against both companies and labor.
“It should be repeated that the National Labor Relations Board is to be purely a quasi-judicial commission. Its prestige and efficacy must be grounded fundamentally in public approval and in equal confidence in its impartiality by labor and industry. If the Board is placed in the Department it will suffer ab initio from the suspicion that it is not a court, but an organ devoted solely to the interests of laboring groups. Far from helping labor, this will impair the work of the Board and render more difficult the sustaining of its supposedly impartial decisions by the Federal court.”
And Marcantonio quoted at length from Humphrey’s Executor to make his case before his fellow members of the House. He plainly argued the Supreme Court had sanctified Congress’ ability to protect some members of the executive branch entrusted with quasi-judicial powers from arbitrary dismissal, and Congress needed to once again make use of that ability in this case.
Placing the NLRB under the Department of Labor, Marcantonio claimed, “invites the risk that under the Myers case the President might have the unrestrained power of removal of the members of the Board during their statutory terms of office, contrary to the intent of Congress.”
The amendment, first suggested by Perkins, to place the NLRB under the Department of Labor was rejected in the House by a vote of 48 ayes to 130 noes.
Later, when trying to reconcile the House and Senate versions, the representatives of the House championed this “amendment no. 7” to add the following sentence to section 3(a) of the NLRA:
“Any member of the Board may be removed by the President, upon notice and hearing, for neglect of duty or malfeasance in office, but for no other cause.”
The conference report of June 26, 1935 (excerpted below) is clear evidence Congress recognized that they were responsible for vesting the President with the power of removing certain officers. There is no hint of a Constitutional power of the president to dismiss any employee of the executive branch they wish, save for Jerome Powell.
If the Supreme Court officially overturns Humphrey’s Executor, or so enfeebles the precedent such that it may as well have been overturned, they will have again acted as partisans of the presidency against the legislature. And the country will be poorer for it.
Today, at every level the American economy is shaped, directed, and restrained by the federal government. At the start of the 20th century, during the Progressive era and the early years of the New Deal, as Congress set about drafting legislation that would remake the American economy, they recognized the forces they were playing with.
Hardly removed temporally from the heyday of Tammany Hall and the Teapot Dome scandal, politicians knew they had to head off open corruption. Members of Congress saw that the public bodies governing markets had to be apolitical and consistent for the invisible hand to properly function. Whether they were tasked with drawing up plans for the FTC, or the SEC, or the NLRB, prudent legislators sought to act as the Founders had and design institutions insulated from malfeasance.
Today, the Supreme Court’s majority evidently recognizes that fact, as their carveout for the Federal Reserve indicates. They have forgotten, though, that while the Constitution does vest the “executive power” in the president, the Founding Fathers did not give us a king.
As a simple reading of the Federalist Papers or the Constitution reveals, the legislative branch was always meant to be predominant, and the president’s authority inseverable from their dictates.
By making the president immune from prosecution for criminal “official acts,” and weakening Congress’ ability to check presidential whims, the Supreme Court is not defending the constitution. They are rewriting it.
Seriously, read Kagan’s dissent if you have a couple of minutes. It’s just seven and a half pages.
Interestingly, although the NLRA was the subject of the hearing, the members of Congress used their opportunity to quiz Perkins about a variety of topics, most frequently unemployment insurance.
The NLRB established by a June 1934 executive order under the auspices of part 7(a) of the NIRA, that is.
This quote is tangential to this post, but I felt I ought at least include it as a footnote: “Unless Congress protects the workers what liberty have they? Liberty to be enslaved, liberty to be crucified under the spread-out system, liberty to be worked to death under the speed-up system, the liberty to work at charity wages, the liberty to work long hours. So far as I am concerned, the present laissez faire policy which we have followed in reference to labor has produced a situation which can be described in the words of Anatole France, when he said: ‘The law in its majestic equality forbids the rich as well as the poor to sleep under bridges, beg on the streets, and steal their bread from the shop windows.’ This bill should pass. It will not settle the capital-and-labor problem, but it is a great step toward a Magna Carta for American labor.”