The CDC's Chevron Gamble

The stakes of the CDC appeal are much higher than "Masks on a Plane"

I am not a gambling man.

As an entrepreneur, investor, financial data analyst, and rock climber, I may appear on the surface to be a massive risk-taker, but I see myself as a proactive risk-manager. It’s critical to know the stakes of the game, and to manage all the risks we can. Sometimes, that means keeping money in bonds or REITs, taking my rock-climbing gear for a hike to the cliff & back without ever climbing rocks, and choosing to stay inside instead of skiing on unstable snowpack.

The CDC, on the other hand, is proving to be quite the gambler. Goaded by mobs of epidemiologists firing tweets from their armchairs, the CDC is taking a loan on our administrative state to play its latest game of public health policy roulette.

The world’s epidemiologists first displayed an uncanny appetite for gambling when they manufactured consent for the containment of COVID in 2020. At the time, we had vaccines in development that were positioned to undergo phase 3 trials, but we had no proof that these vaccines would work. The prior history of vaccines for coronaviruses was not promising. Despite decades of monitoring strain evolution and developing real-world vaccines, our influenza vaccines averaged ~30% effectiveness at reducing infections, and we had never before seen a coronavirus vaccine make it through phase 3 trials.

The stakes of the vaccine gamble were extraordinarily high as containment policies carried massive costs. From just our brief lockdowns, and the whack-a-mole lockdowns occurring sporadically throughout Europe, it was clear that tens of millions of people predominately in Africa and Asia would be severed from our contracting global trade networks, and these people would starve. Up to 120 million people were at risk of facing acute hunger if we pursued aggressive containment policies through all of 2020, and thankfully (or tragically, if your not a gambler and your bleeding heart still beats), only >20 million people were thrown into acute hunger and >100 million kids thrown into multidimensional poverty.

The vaccine gamble didn’t quite break even. While vaccines were shown to be safe and effective, the world’s control groups - South Dakota, Florida, Sweden, among others - already saw their pandemic COVID outbreaks come and go prior to the arrival of vaccines, with much lower mortality than estimated by vaccine gamblers. It’s not clear vaccines saved “millions” of lives in the US. They clearly saved many during the Delta wave, but there’s no solid evidence they saved “millions” in the US, whereas entering into this gamble with containment policies clearly sent tens of millions into hunger, over a hundred million kids into poverty, caused millions of kids to drop out of school, caused a mental health crisis in children, and more. While vaccines proved safe & effective, I don’t consider global vaccine inequity on top of 20 million people starving to prevent maybe a few hundred thousand geriatric deaths a “win”. Rather, I see losses, ruin, and unmanaged risk from the vaccine gamble.

Just when we thought the pandemic was over, and epidemiologists would retreat to wearing elbow patches, smoking pipes, and sharing fantastical compartmental models of costless containment in dusty journals, the CDC has croaked back into our lives for yet another round of public health policy Hold ‘Em. Instead of gambling on vaccines, this gamble is on Masks-on-Planes, a slightly more important topic of public health than Snakes on a Plane but a relatively minor topic nonetheless as vaccines and treatments have greatly reduced the severity of COVID for people who wish to manage their individual risks. Like the vaccine gamble, the Masks On A Plane gamble has costs and stakes that are much higher than the gamblers are letting on.

To bring you up to speed, amidst the vaccine gamble, the CDC issued a rule requiring travelers wear masks on planes, trains & automobiles. As vaccines became widely available in the US, for the profits of Pfizer at the expense of vaccine availability in low-income countries, the masks-on-a-plane mandate was set to expire.

Then, in April 2022, almost a year and a half after cases peaked in South Dakota prior to the arrival of vaccines, two years after life resumed in US states opting out of the vaccine gamble and following a series of outbreaks driven by the evolution of novel variants capable of infecting patients with prior immunity, the CDC extended its masks-on-a-plane order. However, the Health Freedom Defense Fund had filed a case in 2021 arguing that the CDC exceeded its statutory authority when requiring masks-on-a-plane. The plaintiffs didn’t like masks, arguing that their anxiety and other conditions aren’t included as exemptions in this mandate, and so the plaintiffs have standing because the CDC imposed a legal obligation for these people to wear masks on the plane despite the plaintiffs not liking masks and having decent reasons for not wanting to wear masks on a plane.

A Florida district court judge sided with the Health Freedom Defense Fund, arguing the CDC exceeded its statutory authority. Like any 59-page ruling, there’s a lot going on in the judge’s ruling. If you zoom in with the same myopia with which we zoomed in on COVID at the expense of poverty and hunger in 2020, you see the judge’s argument against the CDC’s definition of “sanitation”. As everyone talked exclusively about COVID in 2020, now pundits talk exclusively about “sanitation”, saying the ruling’s definition of sanitation is too narrow.

Sanitation seems important because under the ancient Section 264 of the Public Health Services Act of 1944, the CDC has the power to enforce regulations that “in its judgement” are necessary to prevent the spread of communicable diseases. Specifically, this section “informs kinds of measures that could be necessary: inspection, fumigation, disinfection, sanitation, pest extermination, and destruction of contaminated animals and articles." The CDC says “sanitation” can more broadly mean “preventing viruses from getting into the air”, whereas the plaintiffs argued something like “sanitation” means “cleaning” things and not “preventing them from getting dirty”.

So, now everyone’s talking about sanitation, and in their serial myopia they’re missing a bigger picture. Athony Fauci, the head of NIAID and controversial figurehead motivating the vaccine gamble of 2020 while coordinating with the head of NIH to orchestrate devastating take-downs of people who didn’t like that gamble, argued that “the court overruling a public health judgement… is a disturbing precedent.” In part goaded by a field filled of myopic gamblers presenting themselves as experts on all of society, the CDC appealed the Florida district court’s decision critiquing the definition of sanitation.

The CDC’s briefing, in efforts to defend its broader definition of “sanitation”, appeals to the next topic of serially myopic media coverage - monkeypox - saying this law is used “to prohibit the capture, distribution, or release of certain animals to prevent the spread of monkeypox.” This argument appears to be holding us hostage, insinuating that if we don’t give them broad authority to define “sanitation” as they see fit, we’ll all get monkeypox. Of course, their proposed inability to conduct pest-control without sanitation is, in fact, well covered under “pest extermination, and destruction of contaminated animals” of Section 264, and cleaning dirty towels that might contain monkeypox is indisputably covered under our shared definition of “sanitation”, but who cares about the specifics at this point? There’s another scary virus made scarier by massive media coverage, and our public health authorities want more public health power. They want the freedom to decide whose freedoms they can infringe without judicial or congressional oversight.

What the magicians are distracting us from in this act, however, is that the stakes are much larger than the definition of “sanitation”. While some argue the stakes are so high because “sanitation” is so important, the stakes are, in fact, even higher. Sanitation is the topic of parts 1 and 2 of section A of the Florida judge’s ruling. In other words, “sanitation” is only part of the picture. What about part 3? That part is titled “Chevron Deference”.

Part 3 starts off noting “the government invokes Chevron deference, arguing that even if its reading of § 264(a) is not the best one, the Court should adopt it anyway”. That’s a pretty good summary of Chevron deference which, broadly, says that courts should take agencies’ words for it whenever agencies interpret their own powers. Congress passes a law saying something like “The CDC has the power to clean things” and the CDC gets the benefit of the doubt when interpreting what “the power to clean things” means. The CDC says “to clean” includes “to prevent from getting dirty” whereas the plaintiffs say that’s ridiculous, “to clean” is not the same as “to keep clean”, and, under Chevron, courts usually side with the CDC’s interpretations.

Let’s zoom out even further to see the big picture. Zoom out beyond COVID, beyond sanitation, and beyond the CDC, and we’ll see the stakes of this Chevron gamble. Our federal government regulates an increasingly complex society filled with risks ranging from pollutants and subprime mortgages to foods, toys, diseases, and more. The complexity of our society seems beyond the reach of any one person, so Congress usually sets up agencies to be filled with people devoted to specific problems. Congress gives the FDA power to regulate food & drugs, the SEC power to regulate securities and exchanges, the EPA power to regulate all things “environment” from endangered species to pollutants, the CDC the power to regulate diseases, and so on.

Executive agencies, at their best, can be remarkably adept at managing our complex society. Staffed with subject matter experts for the problems under the purview of their statutory authority, executive agencies stay up-to-date on the latest developments in a way Mitch McConnell and Nancy Pelosi can’t. Rather than pretend ol’ Mitch is an expert on cryptocurrencies and Web3, despite the fact that he probably still uses AOL (if that), the US Treasury Department is staffed with experts who are intimately familiar with crypto and web3 and more, and these experts have the power protect the financial security of the United States by regulating shitcoin false-advertisements and any/all things predatory or insecure that emerge on web3. Rather than requiring Mitch McConnell and Nancy Pelosi to legislate on e.g. how to regulate novel cryptocurrencies or how to ensure financial security of DeFi credit networks, we usually “Chevron-defer” to the experts in their best efforts to interpret their own “power to clean” whatever crazy innovation society cooks up and whatever mess it’s about to make. Chevron deference is the legal precedent that serves as a cornerstone to our modern administrative law, allowing the expansion of executive agencies’ powers as the complexity of the things they regulate expands, as new products hit the market, new pollutants threaten the environment, and new diseases spill over into people.

It’s well known that some members of the Supreme Court don’t like Chevron, and they have made good arguments for why Chevron is being taken to far. Chief among Chevron dissidents is not-Chief-Justice Brett Kavanaugh. Kavanaugh goes back to our constitution and sees that congress has the power to write laws, the executive branch can execute laws congress passes, and the courts can interpret the laws - nowhere in that document does Kavanaugh see a “The CDC Says…” article or section or even footnote. Scholars and justices who don’t like Chevron see Chevron deference as an abdication of the court’s responsibility to interpret what Congress meant by “the power to clean”, including the court ruling that congress was not sufficiently clear. Maybe “the power” is too broad, or “clean” too ambiguous, or the intention of “sanitation” unclear, and so, they reason, the effort to expand agency powers should be denied until if and when Congress clarifies what it meant to expand the powers granted to the agency. If Congress wants “sanitation” to include “prevent from getting dirty”, then they can get off their asses and write a law saying just that. I’m not a gambling man, but I’d bet that Kavanaugh, and the majority of current Supreme Court justices who tend to side with Kavanaugh, would be as happy to overturn Chevron as they apparently are to overturn Roe v Wade.

Now that we’ve zoomed out and seen the other parts of the Mask-on-a-Plane case & how they connect to a cornerstone of modern administrative law, it’s easier to see the massive stakes of the CDC’s Masks-on-a-Plane gamble. “Sanitation” is just a wobbly peg of agency deference at the bottom of a massive Jenga tower of administrative law relying on Chevron deference, and the CDC is overconfidently - or naively - pulling that peg without acknowledging how the whole tower could crumble. While the CDC is focusing on “sanitation”, at stake is the very real possibility of the SCOTUS overturning Chevron. While myopic pundits talk about how a narrow definition of “sanitation” can make it difficult for the CDC to “sanitate” in other contexts, they have not disclosed to the public the other part of the Florida ruling, that the judge basically said “F*** Chevron Deference, I’m a judge and I get to decide what a law says and the law says ‘sanitation’ not ‘prevent from getting dirty,’” and that ruling is now going up the chain towards the Supreme Court. If the myopic appeal ends up trickling through to Kavanaugh’s desk, it’s reasonable to expect he will write an eloquent majority opinion saying, effectively, “F*** Chevron Deference”, he will pull out the peg at the bottom of the wobbly Jenga tower of administrative law, and smile as Chevron v. NRDC goes the way of Roe v. Wade.

At stake will be the EPA’s ability to interpret its own statutory authority to regulate pollutants, and many extractive industries and other sectors will surely, like states capitalizing on the death of Roe, capitalize on the death of Chevron to say the EPA’s reliance on Chevron deference is no longer sufficient to determine what “clean air” means or what an “endangered species” is. Pharmaceutical and other companies may object to FDA’s interpretation of “safety” in our food & drugs. And so on. No longer will experts in executive agencies be given the deference to decide what “the power” they were granted is.

Kavanaugh isn’t evil. Kavanaugh and others opposing Chevron are smart and they have a different view of constitutional law than most liberals. From their eyes, it’s not necessarily a bad thing to dial back agency deference. We’ve clearly seen in COVID that sometimes experts are wrong and other times experts are unrepresentative of the will of the American people. If the experts are not always right, and if the experts can act in ways that go against the will of the American people, perhaps we shouldn’t just defer to them but, instead, rely on our constitutional system of checks and balances designed to represent people and prevent abuses of power. The “Endangered Species Act” is still an act passed by congress, so overturning Chevron won’t cause the extinction of all species, but it will open the floor to debate the EPA’s statutory authority under such an act by reconsidering what “endangered” means and what a “species” is, statutory interpretations that, under Chevron, were left to the EPA. That may mean grizzly bears in Montana are not “endangered” because there are grizzlies in Canada and Alaska, and the Mexican gray wolf of New Mexico is a subspecies that will no longer be considered a “species”. If Chevron falls, these beautiful conservation success stories and cornerstones of ecosystems they inhabit may die at the hands of ranchers who don’t like them, hunters who want to hunt them, and developers who care more about development than species conservation, all because the EPA no longer gets to decide who’s “endangered” and what a “species” is.

The risks of overturning Chevron are large. While overturning Chevron might lead to outrageous pollutants, extinctions, diseases and other motivating disasters that goad Congress to act, it’s also clear that our Congress is inept and locked in a polarizing partisanship. While some believe passing the statutory ball back to Congress can jolt the deliberative body back to deliberative life, that is also a gamble. Yet, that gamble is down the road, and will only occur if some stubborn executive agency <glares at the CDC> imposes regulations people really don’t like and, in its myopic stubbornness, gives the Supreme Court an underhanded pitch to knock Chevron out of Precedent Park. The CDC, by appealing the ruling overturning its masks-on-a-plane mandate, is moving us one step closer to a world without Chevron. Kavanaugh is at bat, the underhanded pitch is in mid-air, and the Jenga tower of administrative law wobbles in slow motion as Kavanaugh smiles.

The CDC’s Chevron gamble is yet another gamble I’m not comfortable with, yet another case of subject matter myopia leading to mismanaged risks caused by a failure to see the full portfolio of impacts. Yet, ironically, it also reveals the limits of executive agencies. From vaccines to Chevron, the CDC is full of unelected (albeit well-intentioned and smart) people proving willing to make policy gambles Americans may be uncomfortable with. The CDC really really wants the statutory authority to do something some people really don’t want it to do, something a judge says it can’t do, and now the CDC is throwing a fit by going all-in on Masks-on-Planes. All of us citizens sit here, powerless, as all of those chips are pushed to the center of the table along with the keys to Chevron. Perhaps agencies shouldn’t have the power to make such gambles, perhaps we really should defer to Congress or the people to ask if they’re comfortable with agency actions. Perhaps, in my desperate love of some wonderful things that some agencies have done, I have been myopic and wrong about the larger, procedural importance of congress passing laws & judges punting unclear laws back to congress.

Perhaps the CDC has shown us why Kavanaugh is right about Chevron deference. To paraphrase Jim Jefferies, our laws are made to regulate the lowest common denominator. While Jim is great at speeding, one guy speeds and kills a family of four, and then we have speed limits. While Jim’s takes cocaine like a champ, a few people die of overdoses or get withdrawals and rob stores, and cocaine becomes illegal. While the EPA, FDA, SEC and more may, for many generations, be moderate in their use and rare in their abuse of agency deference, the CDC may have taken things too far with vaccine gambles that send 20 million into acute hunger, with Masks-on-a-Plane mandates, and with its own willingness to gamble Chevron.

By manufacturing belief in high-severity outcomes from COVID leading to containment policies that sent millions into hunger, by forcing mandates that many people don’t like, and by myopically sending an appeal arguing about “sanitation” towards a SCOTUS salivating to overturn Chevron, the CDC is nominating itself as the lowest common denominator of our executive agencies. Over a silly definition of “sanitation”, the CDC appears willing to gamble a pillar of our modern society’s constitutional law, a legal cornerstone of our executive agencies, and perhaps, should the CDC lose, its willingness to gamble will be precisely the reason why we can’t have that nice thing of Chevron deference at all.

I’ll share some risk-management advice from Kenny Rogers with the CDC: '“you gotta know when to hold ‘em, know when to fold ‘em, know when to walk away, and know when to run”. While I would’ve walked way after the Florida district court decision, the CDC chose to hold ‘em. If the circuit court of appeals sides with the Florida district court, the CDC will have one last change to fold ‘em before going for broke.

If it wins, the CDC can interpret “sanitation” as “prevent form getting dirty”. Whoop-de-doo. If it loses, the CDC can cripple other executive agencies’ abilities to manage our complex society. If this leads to the extinction of Mexican grey wolves, the eradication of Grizzly Bears in Montana, or financial crises from collateralized debt obligations full of subprime DeFi loans, I’m going to very sad, and we’re all going to have to deliberate to find better procedures to manage competing risks and powers our complex society.