How Groupthink Works

A fascinating phenomenon in human affairs is how large groups of people in close or semi-close association with each other will claim to believe exactly the same thing about some large and complicated subject.  As Exhibit A, entire nations and peoples will proclaim belief in the same religion, not just the broad generalities, but all the details and particulars of doctrine and dogma.  How many Arabs, for example, will say they are not Muslims?  In some cases like that one, the official group belief may be enforced at times with highly coercive measures, up to and including beheadings and mass executions.  But there are less extreme enforcement techniques with remarkable levels of effectiveness.

Here in the U.S., and among the forces of the Left, we don't so much have religion in the traditional sense, but the closest substitute is the Church of Global Warming, to which most everyone associating with the Left claims to belong.  You often read about a supposed "consensus" that human activities contribute to global warming.  The methodology used to claim that consensus is rather bogus, but more interesting is that the dogmas of the Church extend far beyond the proposition that human activities have some impact on global temperature, and include increasingly dubious tenets such as: mandatory support for government subsidy of renewable energy, mandatory support for restrictions on use of fossil fuels, mandatory support for EPA efforts to ban the use of coal, mandatory support for transfer payments from rich to poor countries as climate reparations, and so forth.  There are even important Church tenets that are manifestly contrary to empirical data, like "the earth is warming" (actual best data from satellites show completely flat trend for 18+ years and declines in the most recent months) and "polar sea ice is disappearing" (actual best data from satellites show record high levels of Arctic plus Antarctic sea ice during 2014-15).  Sorry, but if you want to be accepted as a member into this Church, you must subscribe to all of the tenets, even the ones that are just false statements of fact.

And how do we deal with the apostates?  A fascinating example is playing out with the case of Larry Tribe, celebrity professor of Constitutional Law at Harvard, teacher of Con Law to the likes of Barack Obama, John Roberts, Elena Kagan and even to the Manhattan Contrarian (way back in 1974), arguer of many cases in the Supreme Court, seemingly stalwart icon of the Left, and even Al Gore's lead lawyer in the great Bush v. Gore controversy of 2000.  And now somehow this guy has done the unthinkable and signed on as lawyer for Peabody Coal in challenging pending EPA "clean power plan" regulations designed to shut down the use of coal to generate electricity in the United States.

The official excommunication got under way a little over a week ago with an op-ed in the New York Times by Ricky Revesz, recent ex-Dean of NYU Law School, covered at MC here.  That was only the start.  It is followed with a lengthy article on the front page of Tuesday's print edition,  "Harvard Professor vs. Star Pupil in Climate Case."     Key quote:

To many Democrats and professors at Harvard, Mr. Tribe is a traitor.

Ouch!  As examples, the article cites two of Tribe's fellow Harvard Law professors, Jody Freeman and Richard Lazarus, heaping scorn upon the Con Law arguments he has advanced in support of Peabody:

 “The administration’s climate rule is far from perfect, but sweeping assertions of unconstitutionality are baseless,” Jody Freeman, director of the environmental law program at Harvard Law School, and Richard Lazarus, an expert in environmental law who has argued over a dozen cases before the Supreme Court, wrote in a rebuttal to Mr. Tribe’s brief on the Harvard Law School website. “Were Professor Tribe’s name not attached to them, no one would take them seriously.”  Mr. Tribe’s legal claims, they concluded, are “ridiculous.”

The Times omits any discussion of the merits of Tribe's arguments, or evaluation of their strength.  Are they aware of lengthy concurrences by Justices Thomas, Alito and Scalia in two recent cases making many of the same points?

One of the last lines of the article is the best:

Mr. McKenna, the Republican lobbyist, said dryly, “He’s about to be banned from a lot of cocktail parties.”

McKenna may have said that in jest, but I have no doubt that it is true.  Mr. Tribe, you are now a traitor and a pariah.  That's what happens when you publicly dis the groupthink.  But there is an upside: you are suddenly allowed to think for yourself.  It's liberating!  Now that you have been cast out of the Church, who knows what other dogmas you may think to disagree with?

In other climate news:

• In an interview with ABC News yesterday, President Obama was asked why Americans should care about climate change, and he pointed to one of his daughters' childhood asthma attacks:  "[I]f we can make sure that our responses to the environment are reducing those incidents, that’s something that I think every parent would wish for.”  Huh?  Careful Larry, if you try to rejoin the Church you'll next be asked to buy into the idea that CO2 in the air causes asthma.   Did I hear somebody claim that Obama is "smart"?
• Meanwhile, over in Japan, where they have been short of power since the Fukushima nuclear accident a few years ago, there is now a solution at hand:  40+ new coal power plants!

Federal Student Loan Update: How Huge A Disaster?

While our federal government continues to chase many mortgage lenders for so-called "predatory lending" practices, perhaps we should check in on the situation of far and away the biggest predatory lender of all, the federal government itself.  Its most odious practices are in the area of student loans.  I find the term "predatory" a stretch when applied to a mortgage loan for a house, given that in the worst case the borrower got to live in the house, and even if he gets foreclosed and has a deficiency balance he can normally discharge that in bankruptcy.  Not a pleasant process, but sometimes life can be tough.  Compare that to federal student loans, where the government lends inexperienced 18 - 24 year-olds open-ended amounts, often for dubious and overpriced trade schools, and then flatly forbids discharge in bankruptcy.  Many borrowers' finances are ruined for life, and they don't even have marketable job skills to show for it.  Now that's predatory!

I first covered the student loan situation in November 2012.  That's less than two and a half years ago.  At the time total student loan debt outstanding had just hit $1 trillion, and the default rate reported by the Federal Reserve had just suddenly gone from 8.5% in Q2 2012 to 11% in Q3 2012.  I also pointed out that close to half of the outstanding trillion were loans in deferment, grace period, or forbearance -- meaning that the actual default rate on loans in repayment status could be as high as 22%.  And I asked: "Once the Federal credit card gets behind something, how far and fast can it blow up and explode?"

We are now seeing how fast this kind of pushing of "free" federal money can blow up and explode.  Two articles in the Huffington Post (March 27, 2015 here and August 20, 2014 here) collect the data.  First, the upward march of loans outstanding continues unabated, reaching $1.096 trillion as of June 30, 2014 (and undoubtedly well over $1.1 trillion today).

And how much of that will ever be paid back?  You almost can't believe how fast this is going south.  According to the August 2014 post (citing Education Department data as of June 30, 2014), the delinquency/default rate had reached 18%.  Oh, but with another 34% in deferment, forbearance or bankruptcy, meaning that of those supposed to be repaying, almost 27% were in default.  Then in late March 2015 the Department released a new set of numbers on the performance of its largest loan servicing contractors.  The new data are not completely comparable to the prior data, omitting about a quarter of the universe, and counting as delinquent anyone more than 5 days behind on payment, while the old data required 30 days to be counted as delinquent.  With that said, the new delinquency figure is 33%.  8.5% to 33% in barely two years!

And we haven't even gotten to the question of whether you can trust any number coming out of this crooked government.  In the student loan area a big issue is how many borrowers pay nothing and yet still qualify for "current" payment status.  How could that be possible?  Because the government has so-called "income-based" repayment options.  Show little or no income, and you qualify for a zero or near-zero monthly payment and yet you go in the "current" category.  And how many of such people are there?  Actually, they don't give out information on that.  From the August 2014 article:

At a December Education Department conference in Las Vegas, Brian Lanham, then an executive at student loan giant Sallie Mae, said that more than 40 percent of borrowers who enroll in so-called income-driven repayment plans have a zero monthly payment.  It's "something that's really boosted our income-driven repayment application rates," Lanham said, according to a recording of the event the department posted on YouTube. "If they're struggling," he said of borrowers, "it's an option."  The Education Department did not respond to inquiries regarding the number of borrowers enrolled in plans that require them to pay nothing to keep current on their loans.

In other words, a very large percentage of those counted as "current" are actually paying nothing.  But they won't say exactly how many.  So if you add "supposedly 'current' but paying nothing" to the officially delinquent, what's the percent then?  40%?  50%?  More?  (By contrast, delinquency rates on normal consumer debt like credit cards and car loans tend to be around 6%.)  In an April 2013 article I predicted that the government would be lucky to get back half of its trillion of student loan debt.  Today, that "half" is looking wildly optimistic, and the trillion has grown another 10+%.  Don't worry though -- none of this shows up on the federal balance sheet.

And those "supposedly 'current' but paying nothing" people have been put into a completely hopeless mess.  If they actually try to get ahead, they'll just find the government sucking away all their increased income to pay the loans.  How come I'm not reading about this outrage in the New York Times?  

Competition For The World's Largest Extortion Racket: Justice Department v. SEC v. The Mob

Reading the government-cheer-leader press, you probably have the idea that over in Russia the government can take your property (or even put you in jail) on a whim, but here in the U.S. we have the rule of law.  To counter this naive notion, the Manhattan Contrarian is running a contest starting today to identify the "World's Largest Extortion Racket."  I'll put up the first few candidates today, and I invite readers to make nominations of their own.  Funny, but two of my three initial nominations are agencies of the U.S. federal government.  The one exception is "The Mob."  Does it have any chance of winning?

Nomination #1: Justice Department.  Some may say that the Justice Department actually prosecutes some real criminals, and if you look hard enough you can find some of that, but is there any doubt that their main business is shakedowns?  There's been plenty of coverage of some of those on this site, often to the tune of billions of dollars.  But today let's just focus on the latest one to hit the news.  On Wednesday the New York Times had a long article titled "Prosecutors Ease Crackdown on Buyers of China-Bound Luxury Cars."  It seems that many luxury cars like Mercedes, BMWs and Porsches that sell in the U.S. for $50,000 or $100,000 or even more can be sold in China for double or triple the U.S. price.  Some ambitious U.S. entrepreneurs have figured out the arbitrage and gotten into the business of buying as many of the luxury cars as they can get their hands on, shipping them to China, and making the arbitrage profit.  Does that sound to you like normal business?  To me too.  So how does the federal government get involved?

Here the Times article doesn't do a good job of giving the background, but reading between the lines, it seems that the car manufacturers want to keep the China profits for themselves, and therefore attempt to restrict the ability of customers to buy the cars in bulk.  The arbitrageurs are cleverer than that, and according to the Times, come up with "straw buyers" to make the purchases.  And that's where the federal prosecutors get their hook.

At this point you are undoubtedly asking yourself, why exactly is this a matter of interest for federal criminal prosecutors?  Not that they don't have at least some hook -- after all, essentially anything that can be described as "fraud" is a federal crime, and if the manufacturers are smart they are getting some kind of representation from the buyers that may be false.  But these manufacturers are big boys, and they have their own civil remedies that they can pursue against their customers if a contract term is breached.  Why exactly should taxpayer resources be devoted to doing the bidding of big auto manufacturers to protect their profits?  Here's the argument that the feds have made:

Federal authorities have argued that using straw buyers is a deceptive practice that potentially deprives American consumers of a chance to buy the luxury cars and limits the ability of automakers to keep tight control over sales to domestic dealers and to foreign countries.

"Deprives American consumers of a chance to buy luxury cars"?   That's pretty transparently bogus -- if there is come kind of supposed shortage, then explain why these companies spend by the tens of millions to fill the airwaves with their ads trying to get people to buy more cars.  But keep reading and the real reason for the federal intrusion becomes obvious: The prosecutors are stealing the cars, by the hundreds.  OK, they have a more genteel word than "stealing" -- they call it "civil forfeiture."

Since 2013, raids by the Secret Service have resulted in hundreds of Mercedes-Benzes, Land Rovers, BMWs and Porsches being seized, many of them just as they were waiting to be loaded onto cargo ships. . . .  Civil forfeiture is a powerful tool that prosecutors can use when pursuing cases involving money laundering, terrorism, drug dealing or other illegal activity. But it is a particularly punitive measure because the burden is often on the defendants to prove that any property and cash that are seized were obtained through lawful activities.

So first they seize the cars, and then they make you sue them to try to get your property back, in a proceeding where everything is stacked against you.  According to the Times, they have recently been "settling" some of these cases by giving back half the cars and keeping the rest.  The Times article also suggests that recent reforms of civil forfeiture by the Holder Justice Department may be reducing abuses in this area somewhat.  I'll believe that when I see it -- everything I've seen about these "reforms" indicates that they are extremely modest and in any event don't change the law in any way, so that the prosecutors can just go back to the old abuses as soon as no one is looking.

Nomination #2: SEC.  Crain's New York Business reported this week that on Monday March 30 the SEC had brought an enforcement proceeding against one Lynn Tilton, accusing her of "hid[ing] poor performance in three funds managed by her private equity firm Patriarch Partners."  The enforcement action seeks return of some $200 million in fees to which the SEC says Ms. Tilton was not entitled.

Oh, did I mention that the enforcement proceeding was brought not in court before an Article III federal judge (and potentially a jury), but rather in a so-called SEC administrative proceeding where the matter will be heard by one of the Commission's Administrative Law Judges?  Is there any problem with that?  Well, there is the small problem that the Constitution says that the "judicial power of the United States" is to be "vested" only in courts that have the characteristic that judges are appointed by the President, confirmed by the Senate, and serve for life -- all things that might lead someone to believe that the judges have some independence from the leaders of the agencies and might decide cases impartially.  How about the ALJs?  They are employees of the agency that prosecutes the cases.  In October 2014 the Wall Street Journal published an analysis of previously unpublished data on the SEC's record before its own ALJs, and found that in the 12 month period from September 2013 to September 2014 the ALJs had found in the SEC's favor in every single case.  Recent press reports have repeatedly observed that the SEC is steering an increasing percentage of its cases to its own ALJs as opposed to the legitimate courts.  A recent Reuters analysis showed that the SEC's win rate before juries in federal court was only 58%, and listed the string of high-profile cases that it had lost in 2013 and 2014.  Could the SEC's move to its own ALJs possibly be related to its likelihood of victory?

Two days after its initial article, Crain's had a follow up in which it reported that Ms. Tilton had hired Skadden Arps and had sued the SEC in federal court challenging the Commission's authority to prosecute its claim before its own ALJ.  Ms. Tilton tweeted:

"I hold hope that our nation will allow a fair fight for truth, to defend integrity and intent against allegations, and provide fair forums."

I do too, Ms. Tilton, but that's not how these people operate.  Don't worry, if (I mean when) you lose before the ALJ, you can always "appeal" -- to the Commission itself!

Nomination #3:  The Mob.  Puh-lease.  Nothing that The Mob does is within even an order of magnitude of the shakedowns perpetrated by the federal government.

RELATED: The Second Circuit Court of Appeals has denied the request of the U.S. Attorney for the Southern District of New York for rehearing en banc of the decision in United States v. Newman and Chiasson.  See prior coverage here and here.  No judge dissented.  The Wall Street Journal this morning urges Mr. Bharara to take his case to the Supreme Court, where it is confident he will receive an even more definitive thrashing.  But the betting in the legal press is that the Supremes will decline the case if asked, since there is no split among the circuits and no inconsistency of the Second Circuit's opinion with prior Supreme Court authority.  Meanwhile, how many of Bharara's vaunted collection of 80+ "insider trading" convictions have been undermined by the decision:  20? 30? 40? more?  Seems like it will still be a long time before we find out.  

The Poverty Scam In Action: Tom Vilsack

In the weekend edition, the Wall Street Journal gave Agriculture Secretary Tom Vilsack space on the op-ed page to defend the food stamp program, aka SNAP, against Republican efforts to turn it into block grants to the states.  It is remarkable to me that the Wall Street Journal would allow their pages to be used for government deception at this level.

In the federal pantheon of programs, the food stamp program has a role that is literally magical.  When the government wants to claim that there is lots of poverty in the country in order to sell the people on more "anti-poverty" spending, then food stamps don't count in the measure of poverty.  (Food stamps are defined as an "in-kind" benefit that the Census Bureau omits entirely in determining the official "cash income" measure of poverty.)  When the government wants to claim that there is lots of "hunger" in the country in order to sell the people on more government spending to combat "hunger," it designs a survey that completely ignores food stamps.  (The government's annual "food insecurity" surveys -- often cited by people including President Obama as measuring "hunger" -- are specifically designed to obtain the answer of "I felt food insecure" from food stamp recipients.)

So we now find ourselves in a position where we spend $80 billion per year on the food stamp program, only have poverty by the official definition not budge at all, and the number of people feeling "food insecure" not budge at all.  Actually, that was the whole idea -- if the program dramatically reduced measured poverty and food insecurity, people might think that those problems had been solved, and the political support for continued spending increases could dry up.  Still, you would think that these people would have some shame about their failure.  How is it even conceivable that we spend $80 billion per year on a food-for-the-poor program that has exactly zero effect on reducing measured poverty and food insecurity?  But if you think they would have some shame, you just don't understand how government works.

As Secretary of Agriculture, Vilsack not only runs the food stamp program, he also is in charge of the annual "food insecurity" surveys that prove that his $80 billion program has no effect whatsoever in improving the chosen metric.  So, Tom, what's your defense?

SNAP continues to reduce poverty. . . .   More than 4.8 million Americans, including 2.1 million children, are lifted out of poverty when SNAP benefits are counted as income. . . .  Rather than arbitrarily taking a budget axe to a program with a proven record of effectiveness and declining costs, common sense tells us that we should instead be working together to put those SNAP recipients who can work back to work.

Did you catch where he snuck in there that SNAP reduces poverty "when SNAP benefits are counted as income"?  Except, Tom, that SNAP benefits are not counted as income when the Census Bureau measures poverty.  Have you asked them to change their methodology?  And can't you be honest with us and tell us that the success you are claiming is actually not shown at all in the official government poverty numbers?

And you have to admire the brazenness of his describing SNAP as "a program with a proven record of effectiveness."  By the principal metrics that the government provides, namely the official poverty and "food insecurity" rates, SNAP is literally the most ineffective use of money that it is possible to imagine.  $80 billion per year and neither metric ever budges or ever will budge, even if spending is doubled. 

Desperate Efforts To Rescue The Poverty Scam

I spent the morning today attending a conference with the title "Can We End Poverty?", put on by the Cato Institute at Columbia University.  I came away disappointed.  This was a serious effort by some earnest and well-meaning people.  But in my opinion even the committed libertarians among the presenters gave way too much credence to the government's fake poverty measurements, and way too much credence to the idea that government "anti-poverty" programs are bona fide efforts to alleviate poverty as opposed to being intentionally structured to keep measured poverty from ever going down and thereby justifying and promoting never-ending ineffective expansion of the government.  All participants who addressed the subject agreed that governments (all levels) have spent over $20 trillion on the "war on poverty" since it began in the 1960s, and about $1 trillion per year today, and the rate of "poverty" by the official government measure started at about 15% and is still at about 15%.

The conference was structured in panels, with participants on the libertarian side balanced with others from the Left.  The participants from the Left seemed to view their role as figuring out a way to claim that the "anti-poverty" programs have actually accomplished something other than trapping the intended beneficiaries in a lifetime of poverty.

Most remarkable to me was a guy named Christopher Wimer, identified as a Co-Director of Columbia's Center on Poverty and Social Policy at its School of Social Work.  Wimer, along with several colleagues, claimed to have come up with a new and improved measure of "poverty" called the "Anchored Supplemental Poverty Measure."  He described it in qualitative terms, but without enough specifics to enable a detailed critique.  But the basic idea seemed to be to answer critics of the official measure by giving credit for the huge in-kind transfers passed out these days, and also to adjust the standard of deprivation poverty upwards to account for today's overall higher standards of living.  And the result: poverty today under this measure is just about exactly the same as by the Census Bureau official measure, about 15%.  But under this measure the poverty rate in the 60s would have been close to 30%, and much of the decline is credited to the handouts that have arisen since.  A couple of comments:

• Since he could have picked whatever standard of "poverty" he thought appropriate for today, it is clear that his standard was reverse-engineered to come to approximately the same figure as the Census Bureau.  We must maintain the official party line that almost 50 million Americans are "poor"!
• If the poverty rate in the mid-60s was close to 30%, then very likely he has defined my own family of the time into "poverty."  We lived in quite modest circumstances, but no way did we consider ourselves to be in or near poverty, and we would have found it insulting to suggest such a thing.

The guy gave an impression of being sincere, but all I could think was, how is this anything other than a completely cynical effort to keep alive the poverty scam?  For those who haven't read my prior articles, by the "poverty scam" I mean the intentional effort to keep the number of people supposedly in poverty high despite the trillions in government expenditures, in order to justify further growth of the government to cure the problem.

And along very similar lines, consider the op-ed from the Times's Thomas Edsall from Tuesday titled "How Poor Are The Poor?"  (Note that I have previously criticized Edsall for his "appalling ignorance" of the poverty scam.)  Edsall writes on the article appearing in the April 2 edition of the New York Review of books by Harvard's Christopher Jencks titled "The War On Poverty: Was It Lost?"  Edsall first notes that Jencks has analyzed the government's poverty rate calculations and made some simple adjustments to take account of the value of government handouts and inflation, and as soon as you do that the poverty rate gets cut to about a third, from about 15% to under 5%:

Jencks makes three subtractions from the official level to account for expanded food and housing benefits (3 percentage points); the refundable earned-income tax credit and child tax credit (3 points); and the use of the Personal Consumption Expenditures index instead of the Consumer Price Index to measure inflation (3.7 percentage points).  Jencks’s conclusion: “The absolute poverty rate has declined dramatically since President Johnson launched his war on poverty in 1964" [to 4.8%]

Edsall calls Jencks' 4.8% "the lowest poverty estimate by a credible expert in the field."  Well, I guess I have just been called "not a credible expert in the field" (OK, I wasn't very flattering toward Edsall either), but I would say that Jencks has only just begun with the needed adjustments to the so-called poverty rate.  He hasn't even started to account for the large numbers of affluent people counted in "poverty" because they don't have measurable "cash income" this year -- students living on scholarships and family support, early retirees with substantial savings and million dollar houses who haven't taken social security yet, people who take a year off from work to change careers or maybe travel.  Don't believe that these categories distort the statistics?  Take a guess what the official "poverty" rate is in affluent Ithaca, New York.  Ready?  It's 55.6%.  They just shamelessly count thousands of students (nationwide, it's millions), many from rich families, and hope no one will notice.

Wait a minute!  If you keep this up you're going to get the "poverty" rate down to about 1 or 2% -- how can that possibly justify additional trillions of government spending that I want for myself and my friends?  Well, Edsall says he went out and talked to a bunch of "experts," and they have the answer -- a measure of poverty that defines the concept in relative rather than absolute terms.

[An alternative measure of poverty] is to count all those living with less than half the median income as poor. There are strong theoretical justifications for the use of a relative poverty measure. The Organization for Economic Cooperation and Development puts it this way:

In order to participate fully in the social life of a community, individuals may need a level of resources that is not too inferior to the norms of a community. For example, the clothing budget that allows a child not to feel ashamed of his school attire is much more related to national living standards than to strict requirements for physical survival.

Using one-half of the median income estimates the number of poor people at over 70.6 million, far above the 45.3 million official number, according to Shawn Fremstad, a senior fellow at the Center for American Progress, a liberal think tank.

Sounds to me like they're getting desperate.  The American people have so far shown themselves remarkably easy to scam with the poverty statistics, but the purveyors of the statistics at least go to major effort to hide the scam in complicated survey techniques and program definitions that take a lot of work to penetrate.  When you go to the so-called "relative" measure of poverty, isn't it immediately obvious to everybody that the whole idea is to have something that by its very definition cannot go down no matter how much the government spends to fix it?

And I love that part from the OECD about a "child feeling ashamed of his school attire."  I lived the bulk of my childhood in hand-me-downs from friends and relatives -- and so did lots of other kids I knew.  Do they think I felt "ashamed"?  Really, that's obnoxious.  Now, if my family had taken government handouts to buy new clothes so that I wouldn't have had to wear hand-me-downs, then, yes, I would definitely have felt ashamed. 

Can The Administrative State Ever Be Reined In?

A couple of weeks ago on March 9, two Supreme Court cases came down on relatively obscure issues of administrative law.  They are Perez v. Mortgage Bankers Assn. and Dep't of Transportation v. Ass'n of American Railroads.  Both were unanimous reversals of the lower courts, and neither one attracted much attention in the press at all.  But there's something unusual and very remarkable about these cases that I did not notice at the time: both contain lengthy concurrences by several of the Justices (Alito, Scalia and Thomas) that call into question in fundamental ways the whole basis of the administrative state.  Thomas, most notably, wrote a separate concurrence of 23 pages in one case and 27 in the other.  This is by no means an every day event.

What do I mean by the administrative state?  It is the vast extra-constitutional apparatus of agencies and rules that sprang up mostly starting from the New Deal and has only accelerated since.  Read the Constitution and you will find only three grants of power, one to each of the three branches of government: "All legislative Powers herein granted shall be vested in a Congress of the United States . . ." (Art. I); "The executive Power shall be vested in a President of the United States . . . ." (Art. II); and "The judicial Power of the United States, shall be vested in one Supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish. . . ." (Art. III).  What could be simpler and more elegant?  Three sorts of power allocated to three separate branches, who do not work for each other and can check each other's power in various ways.

Even though the Constitution has not been amended in any respect on this subject, here's how it works today: Dozens of administrative agencies, some within the executive departments and some not, promulgate thousands upon thousands of pages of rules purporting to bind the American people.  Then agency staff prosecute the people for violations of those rules before "administrative law judges" who are also employees of the same agency; and if you lose before the ALJ (which almost everyone does -- they are not impartial in any meaningful sense) your "appeal" is to the head of the agency, who is also the boss of the prosecutors and of the ALJ.  Then, assuming that you have infinite resources to continue a fight against the ultimate deep pocket, you have a theoretical right to take further appeals into a court system, but that court system under Supreme Court precedent gives so-called "deference" about 99% of the time to agency determinations.  And by the way, every federal official involved in this gigantic charade has taken an oath to uphold the Constitution.  Has anybody here even read it?

And thus, to take just one example among zillions, we now have EPA in the process of promulgating "regulations" having the purpose and effect of forcing the shut-down of the entire coal-based portion of electricity generation in this country, which until recently was almost half of our electricity.  If those regulations are to be generally applicable to the American people and govern private conduct, don't they have to be passed by both houses of Congress and signed by the President?  Or how about the SEC purporting to ban what they call "insider trading" by non-insiders -- something that Congress has never made illegal -- and then seeking to prosecute "violators" before its own ALJs?

There's not nearly enough room in a post here to describe the sorry history that got us into this predicament.  But I do recommend reading all of these concurrences in their entirety.  If you take an hour with that project, you will get a good grounding in some of the most fundamental constitutional principles, and with any luck you will also unlearn a good deal of the looking-glass constitutional law that you have undoubtedly ingested from the likes of Linda Greenhouse and Adam Liptak (of Pravda).

Just a few key quotes to give you a taste.  This is from Justice Alito's concurrence in Association of American Railroads:

The principle that Congress cannot delegate away its vested powers exists to protect liberty. Our Constitution, by careful design, prescribes a process for making law, and within that process there are many accountability checkpoints. See INS v. Chadha, 462 U. S. 919, 959 (1983). It would dash the whole scheme if Congress could give its power away to an entity that is not constrained by those checkpoints.

From Justice Thomas's concurrence in Association of American Railroads:

We have held that the Constitution categorically forbids Congress to delegate its legislative power to any other body . . . but it has become increasingly clear to me that the test we have applied to distinguish legislative from executive power largely abdicates our duty to enforce that prohibition. . . .  I would return to the original understanding of the federal legislative power and require that the Federal Government create generally applicable rules of private conduct only through the constitutionally prescribed legislative process.

All of these concurrences cite and rely to varying degrees on the excellent current book by Columbia Law Professor Philip Hamburger, Is Administrative Law Unlawful?  Hamburger has done an unbelievable job of tracing the history of the rule of law and separation of powers back into Renaissance and even medieval times.

So the answer to the question in my title is, yes the administrative state could be reined in, and dramatically so, by the right Supreme Court.  However, currently a plurality (but maybe a small plurality) of our justices think that micromanagement of the people by unaccountable government "experts" is the way to go, and if the Constitution doesn't seem to say that, we'll just find some way to let it happen.

Thanks to Michael Greve of Library of Law and Liberty for pointing me to these decisions and the concurrences.

UPDATE March 26, 2015: I had some time on the subway this morning with nothing better to do than read the op-eds in today's New York Times (now that's desperate!) and I came across one by recent NYU Law dean Ricky Revesz complaining about Harvard Con Law Professor Larry Tribe (he taught Con Law to President Obama -- and also to me!) filing a comment on behalf of Peabody Coal raising constitutional objections to EPA's currently proposed "Clean Power Plan" regulations mentioned above.  The objections raised by Tribe include violation by EPA of "the Constitution's nondelegation doctrine, which bars agencies from exercising legislative power"  -- exactly the subject of the Alito, Scalia and Thomas concurring opinions described above.  Tribe also raised additional constitutional issues under the Tenth Amendment and the Takings Clause of the Fifth Amendment.  Revesz continues:

In the estimation of his Harvard Law School colleagues Jody Freeman and Richard Lazarus, “Were Professor Tribe’s name not attached to” these arguments, “no one would take them seriously.” But even if his claims don’t help Peabody in federal court, they are undoubtedly useful in the court of public opinion, where sentiment can be swayed by legal arguments, however weak, from a scholar of Professor Tribe’s reputation. 

You are observing how they use shaming to enforce the official groupthink in the groves of legal academia.  Well, Mr. Revesz, maybe you can call me "nobody," and maybe even Michael Greve and Philip Hamburger, but Alito, Scalia and Thomas?  Really?

My bet is that Revesz does not even know of the existence of Hamburger's book or of the Alito, Scalia and Thomas concurrences in the Perez and Ass'n of American Railroads cases.  Don't worry -- none of the New York Times readers know about those things either!