Regulatory failure? Blame the DC Circuit

There's a lot of talk these days about how Washington has become dysfunctional. While most of the focus has been on Congress, the inability to perform even basic functions also extends to the agencies that are charged with protecting workers, consumers and investors. Unfortunately, it often takes a global financial crisis or a deadly coal mine explosion to remind us of the serious consequences of regulatory failure.

Much of the blame belongs with regulators who have been captured by the industries they are meant to oversee or have been swept up in the general political drift toward deregulation. But, as we were reminded by a case this week involving the Federal Communications Commission, another big culprit is the U.S. Court of Appeals for the District of Columbia Circuit, which over the past decade has intimidated, undermined and demoralized the regulatory apparatus. Many of the D.C. Circuit judges have long since stopped pretending to defer to the factual determinations and policy judgments of duly appointed regulators, as the law requires. Deference has now given way to skepticism, hostility and contempt that can easily be read between the lines of overly legalistic opinions that routinely ignore the plain language of statute and the clear intent of Congress.

It's gotten so bad that top regulators said that they routinely put aside consideration of needed new initiatives because they assume they will be foiled by the hostile appeals court.