FedSoc Online Debate- The Pay Czar & Appointment Clause with Profs. McConnell and Flaherty

November 20th, 2009

I have blogged a bit about the President’s Czars and the appointments clause. Recently Professor McConnell posted a great WSJ Op-Ed on this point.

The Federalist Society is hosting an ongoing online debate between McConnell and Professor Flaherty.

Here are the opening salvos.

McConnell thrusts:

There is no doubt that Mr. Feinberg is an “officer” of the United States. The Supreme Court has defined this term (Buckley v. Valeo, 1976) as “any appointee exercising significant authority pursuant to the laws of the United States.” Mr. Feinberg signed last week’s orders setting pay levels for executives at Bank of America, AIG, Chrysler Financial, Citigroup, GMAC, General Motors and Chrysler. They have the force of law and are surely an exercise of “significant authority” pursuant to an Act of Congress. He is not a mere “employee,” acting at the direction of a superior. That means his office is subject to the requirements of the Appointments Clause.

While somewhat more disputable, Mr. Feinberg’s is probably an “inferior” officer, defined as one subject to supervision and removal by a member of the cabinet. Although he has substantial discretion and independence, Mr. Feinberg reports to the secretary of the Treasury, who can fire him any time for any reason. This means that Congress could, if it wished, vest the appointment of the pay czar in the secretary, without any need for Senate confirmation.

Flaherty parries:

Unless one is a Wall Street solipsist, the power to reduce executive compensation does not place Feinberg on par with Hillary Clinton or above Kenneth Starr. It follows that Congress should have had a role in determining the appointment process, either by vesting the power in the Secretary of the Treasury, the President alone, or even a court, such as the D.C. Circuit.

One point, however, calls for clarification. Judge McConnell at first says that “Congress may, if it wished, vest the appointment of the pay czar in the secretary [as Head of a Department], without any need for Senate confirmation.” So far so good. Yet he adds that, in lieu of Congressional action, he could only delegate the Pay Czar power to someone who is subject to Senate confirmation. On one hand, why could he sub-delegate at all? On the other, why not sub-delegate to someone subject to appointment in one of the three ways that the lower track of the Appointments Clause calls for?