Examining Merrick Garland vs. small business
President Obama last week nominated Merrick Garland, a judge on the U.S. Court of Appeals for the District of Columbia Circuit, to replace Justice Antonin Scalia on the U.S. Supreme Court. If confirmed he could serve on the Court for at least a decade and tip the balance in favor of the existing block of justices who routinely side with government over employers.
The consequences for the economy, and especially for small businesses, could be harsh and long lasting. That’s why the National Federation of Independent Business (NFIB), the country’s leading advocate for small business owners, has been vetting Judge Garland’s record for weeks. Our legal experts have been pouring over his decisions, rulings, and public statements related to hundreds of cases.
After studying his record, NFIB found that Garland has sided overwhelmingly with regulators, labor unions, trial lawyers, and environmental activists. Small employers have been almost always on the losing end of his decisions.
For example, in NAHB v. EPA, Judge Garland in 2011 rejected a Regulatory Flexibility Act (RFA) claim by the National Association of Home Builders against the Environmental Protection Agency. He did so despite the fact that the RFA is unambiguous. It requires certain agencies to analyze the effect of their actions on small employers. That’s an important protection for small businesses, who struggle with the costs of regulations. In fact, according to the SBA, the typical small business must spend $12,000 per worker annually to comply with federal regulations. There’s little doubt that Judge Garland would defer to regulators as a Supreme Court Justice.
In another case, Rancho Viejo, LLC vs Norton, in 2003, Garland argued that the federal government can regulate private property in California under the Commerce Clause because of the presence of a unique species of toad. The Commerce Clause applies to interstate commerce. The toad wasn’t part of any interstate commercial activity. Nevertheless, Garland twisted the Commerce Clause into a pretzel in order to rationalize federal regulation. Would he be just as creative as a Supreme Court justice in giving regulators more power over private property? NFIB believes that’s very likely.
On the Circuit Court, Judge Garland ruled in many cases involving the National Labor Relations Board (NLRB). The NLRB is “supposed” to be a neutral arbiter of labor disputes. Often, however, it acts more as an agent of the labor unions. That’s been especially true under President Obama. Garland ruled in two cases that when employers are found guilty of violations, not only should their business assets be penalized but their personal assets as well. In other words, according to Garland, a business owner’s personal assets, like homes and retirement savings, are fair game for regulators.
In fact, in 16 major labor decisions, Garland ruled in favor of the NLRB in all but one case. In that case he voted with the union. That’s the pattern throughout his long tenure on the bench. He strongly favors government power over private enterprise. He has deep sympathies for labor unions over employers. And he is certain to bring those views to the Supreme Court, where big decisions affecting the economy are likely to be made in the future.
NFIB is a plaintiff in two very important cases that could land at the Supreme Court soon. It is challenging the EPA Waters of the U.S. rule, which would require local business owners to seek federal approval for even the smallest property improvements as long as there is water nearby. The applications will cost thousands; the delays will be endless; the threat of litigation will hang over every project.
The EPA Power Plan rule is just as potentially damaging. It forces states to switch from coal as a source of electricity to more expensive alternatives. Even the EPA predicts it will significantly increase the cost of electricity. That means higher fixed costs and lower profits for small businesses that are already struggling.
After examining his record, it’s a fair assumption that Judge Garland would readily side with the government in both of these major cases. Small business knows where he stands. NFIB is firmly opposed to this nominee.
Bill G. Smith is the Wisconsin state director for the National Federation of Independent Business (NFIB).
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