The Progressive Era, lasting roughly from 1890 to 1920, saw an explosive growth in the size and reach of the American “administrative state.” Congress created a multiplicity of administrative agencies within the executive branch—including the Food and Drug Administration (1906), the Federal Reserve (1913), and the Federal Trade Commission (1914)—to provide greater efficiency in making and carrying out government policy. The turn to administrative governance reflected progressives’ faith in the power of expertise to address social and economic problems. The federal administrative state truly flourished during the New Deal, when Congress, at the urging of President Franklin D. Roosevelt, created an “alphabet soup” of new executive agencies to combat the Great Depression. These included the Securities and Exchange Commission (1934), the Social Security Administration (1935), and the National Labor Relations Board (1935). Administrative agencies performed a variety of functions, some of which bore similarities to those performed by other branches. When promulgating regulations pursuant to statutory authority, they acted in a quasi-legislative capacity. When they engaged in fact-finding, held hearings, and adjudicated disputes, they performed quasi-judicial functions.

Agency regulations and rulings were sometimes challenged by those affected. In Marbury v. Madison (1803), a case brought against Secretary of State James Madison, the Supreme Court implicitly acknowledged that reviewing the actions of executive branch officials was within the federal judicial power. When Congress built the modern administrative state, it had to determine which of an agency’s actions could be reviewed only within the agency and which could be appealed to the federal courts. In deciding whether to uphold or strike down an agency regulation or whether to affirm or reverse the ruling of an administrative law judge, courts were faced with the crucial question of what degree of deference to grant to the agency action under review. To defer completely to the decisions of agencies would deprive federal court review of any meaning, while evaluating every issue anew, with previous agency decisions given no weight, would be inefficient and make reliance on agency rulings impossible.    

Opinions about the degree of deference courts should give to agency decisions split along ideological lines. Progressives and New Dealers saw federal agencies as protectors of individual rights, particularly against the corporations those agencies often regulated. Reformers believed that allowing agencies wide latitude was a counterweight to the courts favoring corporate interests. Conservatives, on the other hand, viewed governance by unelected bureaucrats as anti-democratic and hostile to the separation of powers. Some, such as the American Bar Association’s Special Committee on Administrative Law, went so far as to call it a step toward totalitarianism. O. R. McGuire, who chaired the committee in the 1930s, asserted that the erosion of the separation of powers could lead only to “anarchy or … a form of government on the Russian, Italian or German models.” Consistent with these views, conservatives called for stringent judicial review of agency action.

Early in the twentieth century, the U.S. courts of appeals did not often defer to administrative agencies.[1] For example, the courts had regularly ruled against the Federal Trade Commission—established to prevent unfair competition in interstate commerce—since its inception. Although the commission’s originating statute provided that its factual findings were to be considered conclusive if supported by testimony, the courts construed this provision narrowly, frequently finding reasons to set these findings aside. Moreover, in Federal Trade Commission v. Gratz (1920), the Supreme Court stated, “[i]t is for the courts, not the commission, ultimately to determine what as a matter of law” constituted unfair competition. The Court also endorsed strict review of agency findings in another 1920 case, Ohio Valley Water Co. v. Ben Avon Borough. In that case, the Supreme Court reversed a state supreme court ruling that required lower courts to defer to findings made by the Pennsylvania Public Service Commission in setting maximum rates for public utilities. When a utility company claimed that a rate was so low as to be confiscatory, the Due Process Clause of the Fourteenth Amendment required that the company be given the opportunity to have that issue decided in a court of law. Lower courts were permitted to make their own factual findings, rather than merely relying on those of the commission, in determining whether a rate was confiscatory.

When the Great Depression began, the Ben Avon precedent worried those who hoped that the administrative state would expand in response to the economic crisis. Another Supreme Court case decided shortly before Roosevelt assumed the presidency added to this concern. In Crowell v. Benson (1932), a case originating before the Employees Compensation Commission, the Court reviewed the commission’s decision to award compensation to an injured maritime worker. The Court noted that the commission could not exercise jurisdiction over the claim unless two conditions were met: that the injury had occurred on the navigable waters of the United States, and that the injured party had been an employee of the respondent. These “jurisdictional facts,” the Court held, were subject to de novo judicial review—a “new” review that accorded no weight to the findings of the commission—because they implicated the constitutional rights of the respondent. In a dissenting opinion, Justice Louis Brandeis argued that the Court’s definition of jurisdictional facts was overly broad and would lead to the second-guessing of too many agency decisions. As the New Deal began, reformers feared that a lack of judicial deference would hinder agencies in carrying out their missions, canceling out the speed and efficiency the agencies were meant to provide in addressing urgent problems.

The early New Deal was hindered by the battle between the White House and the Supreme Court, which struck down several pieces of legislation enacted at Roosevelt’s behest before changing course in 1937. Parallel to the reversal of the tide on the legislative front, New Dealers made gains in administrative law, as the Supreme Court became increasingly deferential in reviewing the actions of executive agencies. By the late 1930s, the Court was generally upholding administrative decisions if they were supported by substantial evidence, even in the face of significant evidence on the other side of the issue. The Crowell decision, while distressing to New Dealers at the time, turned out to be not as dangerous to the administrative state as they had predicted. (Scholars have debated the extent to which the Court’s more deferential rulings in ensuing years can be considered consistent with its holding in Crowell.) Justice Hugo Black wrote in Perkins v. Lukens Steel Co. (1940), a case upholding the right of the secretary of labor to impose wage conditions on companies selling steel to the government, that the Court should not interfere in “fields hitherto wisely and happily apportioned by the genius of our polity to the administration of another branch of Government.”

The Court increased deference to agencies in Skidmore v. Swift and Co. (1944), in which it noted that interpretations of the Fair Labor Standards Act by the Act’s administrator were “entitled to respect.” In overturning a lower court ruling that conflicted with one such administrative interpretation, the Court held that “the rulings, interpretations, and opinions of the Administrator under this Act, while not controlling upon the courts by reason of their authority, do constitute a body of experience and informed judgment to which courts and litigants may properly resort for guidance.” The Court then articulated a standard that came to be known as “Skidmore deference,” under which the deference given to an agency decision depended on the thoroughness with which it was considered, the validity of its reasoning, its consistency with other decisions, and any other factors in favor of its persuasiveness.    

In 1946, Congress sought to standardize administrative procedures and to clarify the standards by which courts should review agency action when it enacted the Administrative Procedure Act (APA). The Act imposed some procedural constraints upon agencies and made judicial review more broadly available in response to complaints of agency overreach since the New Deal era. Section 10 of the Act granted the right to seek judicial review to anyone suffering a legal wrong as the result of an agency action or anyone “adversely affected or aggrieved” by such action within the meaning of a relevant statute. The statute also specified several circumstances under which a court could set aside the action of an agency. These circumstances included a finding that an action was arbitrary or capricious, was contrary to a constitutional right, was unsupported by substantial evidence in a case where a hearing was required, or was unwarranted by the facts in a case where those facts were subject to de novo review by the court.

For the next several decades, the APA provided the basic framework within which the federal courts evaluated the actions of executive agencies. Some believed that the APA did not make substantial changes to judicial review but rather ratified what the courts were already doing in administrative cases. In 1947, Attorney General Tom C. Clark expressed the view that the APA “appears to restate the present law.” By contrast, in Universal Camera v. National Labor Relations Board (1951), the Supreme Court held that the statute had been intended to codify the existing “substantial evidence” standard for the review of factual findings but also to make courts’ varying and often lax applications of the standard both more uniform and strict. Scholars have split regarding the extent to which the APA was meant to change existing practice but have generally agreed that it imposed no dramatic changes.

In 1984, the Supreme Court issued a landmark ruling regarding an agency’s interpretation of its statutory authority in Chevron v. Natural Resources Defense Counsel. In evaluating an Environmental Protection Agency regulation based on the agency’s construction of a provision of the Clean Air Act of 1977, the Court laid out a two-step test for resolving such cases. First was the question of whether congressional intent regarding the statutory provision at issue was clear. If so, that intent would be controlling, and any inconsistent agency action would be invalid. If Congress had not expressed a clear intent, however, reviewing courts were not to supply their own statutory construction but rather to inquire whether the agency’s action was based on “a permissible construction of the statute.” If Congress had explicitly delegated interpretive authority to the agency, the agency’s construction would control as long as it was not arbitrary, capricious, or clearly at odds with the statute. In cases where the delegation was implicit, a court still could not impose its own construction of the statute if that of the agency was reasonable. Subsequently, the standard of review in cases of statutory interpretation was frequently referred to as “Chevron deference.”

Some legal commentators expressed the view that the Chevron opinion, which did not refer to the APA, was inconsistent with the APA’s mandate that “the reviewing court shall … interpret constitutional and statutory provisions.” Others debated whether Chevron had announced an excessively deferential standard or, alternatively, had not changed the landscape of administrative law significantly. In 1997, the Supreme Court set out a deferential standard for an agency’s interpretation of a regulation in Auer v. Robbins. Auer established that an agency’s interpretation of its own regulation was controlling unless it was “plainly erroneous or inconsistent with the regulation.” Both Chevron and Auer deference continued to be subjects of debate within the legal community. While the Supreme Court upheld Auer in 2019, it overturned Chevron in Loper Bright Enterprises v. Raimondo (2024). In that case, the Court held that the APA required courts to exercise independent judgment as to whether agencies had acted within their statutory authority.

[1] Generally, appeals from administrative decisions have been filed in the U.S. courts of appeals, which Congress established in 1891. In a limited number of cases, appeal to a three-judge U.S. district court followed by direct appeal to the Supreme Court was possible, but in 1950 Congress eliminated all such appeals other than those from the Interstate Commerce Commission, which remained available until 1975. On some occasions, Congress has created specialized courts to hear appeals from administrative agencies. The first of these was the Commerce Court, which heard appeals from the Interstate Commerce Commission during the court’s short existence between 1910 and 1913. During World War II, the Emergency Court of Appeals heard challenges to regulations promulgated by the Office of Price Administration. The court’s jurisdiction was expanded to hear other types of agency appeals before being abolished in 1962. Some agency decisions have been appealed to adjudicatory bodies outside of the judicial branch. For example, the U.S. Tax Court, established in 1924 as the Board of Tax Appeals to hear appeals from the Bureau of Internal Revenue, is an Article I legislative court. The U.S. courts of appeals hear appeals from the Tax Court, however.

Further Reading:
Baldwin, Kathryn M. “Endangered Deference: Separation of Powers and Judicial Review of Agency Interpretation.” St. John’s Law Review 92, no. 1 (Spring 2018): 91–120.

Ernst, Daniel R. De Tocqueville’s Nightmare: The Administrative State Emerges in America, 1900–1940. New York: Oxford University Press, 2014.

Grisinger, Joanna. The Unwieldy American State: Administrative Politics since the New Deal. New York: Cambridge University Press, 2012.

Schiller, Reuel E. “The Era of Deference: Courts, Expertise, and the Emergence of New Deal Administrative Law.” Michigan Law Review 106, no. 3 (Dec. 2007): 399–442.

Thomas, James C. “Fifty Years with the Administrative Procedure Act and Judicial Review Remains an Enigma.” Tulsa Law Journal 32, no. 2 (Winter 1996): 259–296.