Free Enterprise Fund v. Public Company Oversight Board Page 2

Free Enterprise Fund v. Public Company Oversight Board general information

Media for Free Enterprise Fund v. Public Company Oversight Board

Audio Transcription for Oral Argument - December 07, 2009 in Free Enterprise Fund v. Public Company Oversight Board

Audio Transcription for Opinion Announcement - June 28, 2010 in Free Enterprise Fund v. Public Company Oversight Board

John G. Roberts, Jr.:

The President cannot hold the commissioners accountable for the board's conduct because the commissioners cannot remove the board at will, they are not responsible for everything the board does.

They are only responsible for their determination of whether the act’s rigorous would cause standard is met and even if the President disagrees with their determination, he cannot intervene on that basis alone.

This arrangement is contrary to Article Two’s vesting of the executive power in the President.

Without the ability to oversee the board or to attribute the board's failings to those whom he can oversee, the President is no longer the judge of the board's conduct.

He does not decide whether board members are abusing their officers or neglecting their duties.

He cannot ensure that the laws are being faithfully executed and he cannot be responsible for board member’s breach of faith.

That consequence undermines the principle of accountability that is at the heart of our democratic republic.

After all none of us get to vote for SEC commissioners or for members of the public company accounting oversight board, instead as Alexander Hamilton explained in the Federalist papers the people look to the President to guide the assistance and deputies subject to his superintendence, without a clear and effective chain of command the people do not know, again as Hamilton put it on whom the blame for “a pernicious measure or a series of pernicious measures ought really to fall" that is why Madison insisted that the chain of dependents be preserved, that the lowest officers, the middle grade, and the highest will depend as they ought on the President and the President on the community.

This much is basic for the people to govern they must be able to hold an elected official responsible for the conduct of the executive branch, that official is under the Constitution the President.

For the President to be accountable, he must have the power to control the executive officers who assist him in carrying out his duties.

This fundamental principle is captured in one of the most famous political axioms in our nation's history.

The one that was on the sign on Harry Truman's desk in the Oval Office, “The Buck Stops Here”.

The Act before us today grants the board, executive power without effective Presidential oversight, under this law the buck stops with the public company accounting oversight board.

The law is therefore incompatible with the Constitution's separation of powers.

The government, the board and the dissent in this case all resist this conclusion.

We have considered their arguments carefully but we disagree.

Respondents for example, argue that the second layer of insulation from oversight does not matter.

They say that the commission has general oversight over the board's functions if not its members that this power is enough but broad power over board functions is not equivalent to a power to remove board members.

The SEC cannot wield a free hand to supervise individual members if it must destroy the board in order to fix it.

Moreover the commission's power over the board is not plenary.

The board has significant independence from anyone's control in determining its priorities and enforcing the laws in the name and with the power of the United States.

The dissent too dismisses the importance of removal as a tool of accountability.

It concludes that the President's practical influence depends on many things such as budgeting authority, relationships between agencies, the influence of Congress and whether unelected official support or resist the President's policies.

But the framers of our Constitution did not rest our liberties on such bureaucratic minutiae.

We think it plain that when the President cannot fire the commission when he wants and the commission cannot fire the board when it wants, the boards independent -- independence from the President is greatly expanded.

The President can always choose to restrain himself in dealing with his subordinates.

This is a case about whether power exists, not about how it should be exercised.

With sincere respect we think that the dissent does not place sufficient weight on the on the constitutional need for accountability.

The dissent points to the vast and varied functions of the federal government, stresses the need for regulation by technical professional experts and portrays the board’s dual levels of insulation as necessary to a workable government.

But you can have a government that functions without being ruled by functionaries, a government that benefits from expertise without being ruled by experts.