Probably, somewhere in high school or even junior high school, you learned about the "separation of powers" in the U.S. Constitution.  There are legislative, executive and judicial powers, each assigned to a separate branch of the government.  There are "checks and balances" between and among the branches.  Thus, our freedoms are preserved.  Or so we are taught.

But if you study the U.S. government today, you quickly learn about vast areas of the government that have somehow broken free of the separation of powers.  I'm talking about the so-called "independent" agencies, like the FTC, FCC, SEC, CFPB, CFTC, CPSC, PCAOB and others.  These agencies are not explicitly part of any of the three branches, yet they promulgate thousands of pages of regulations (legislative power?), and then prosecute people and companies for violating the regulations (executive power?) before administrative judges (judicial power?) who are part of the agency rather than part of the court system.  Where is this provided for in the Constitution?

The answer is that all of this is entirely unconstitutional.  The Constitution provides for exclusive grants of the three types of power to the three branches of the government, and to no one outside that structure.  (Article I: "All legislative Powers" are "vested" in the "Congress"; Article II: "The executive Power" is "vested" in the "President"; and Article III: "The judicial Power" is "vested" in the federal courts.)  But the Supreme Court, in one of the most bizarre decisions in its history -- Humphrey's Executor in 1935 -- signed off on at least one aspect of the independent agency structure.  Given that little opening, the independent agencies, with the blessing of Congress, have proceeded to metastasize like a cancer ever since.

When Franklin Roosevelt was elected President, Humphrey was a Commissioner of the FTC, having been appointed for a seven-year term by prior President Hoover.  The FTC Act provided (and still provides today) that a Commissioner could be removed by the President for "inefficiency, neglect of duty, or malfeasance in office."  Roosevelt asked Humphrey to resign, but not explicitly for any of those reasons; rather, Roosevelt just wanted the agency to take a different tack than it had taken under Hoover.  Humphrey refused to resign.  By the time the case reached the Supreme Court, Humphrey had died, and the entire case was about his estate suing for pay for the period from his refusal to resign to his death.  The government's position was that since all executive power of the government was held by the President, the President could demand the resignation of anyone he wanted.  But the Supreme Court upheld Humphrey's refusal to resign -- on the ground that the FTC was not under the President's authority because it did not hold or exercise any executive power!  After describing the FTC's functions as including investigating and prosecuting violations of the FTC Act, the Court set forth this incomprehensible logic:

The Federal Trade Commission is an administrative body created by Congress to carry into effect legislative policies embodied in the statute in accordance with the legislative standard therein prescribed, and to perform other specified duties as a legislative or as a judicial aid. Such a body cannot in any proper sense be characterized as an arm or an eye of the executive. Its duties are performed without executive leave, and, in the contemplation of the statute, must be free from executive control. In administering the provisions of the statute in respect of "unfair methods of competition" -- that is to say, in filling in and administering the details embodied by that general standard -- the commission acts in part quasi-legislatively and in part quasi-judicially. In making investigations and reports thereon for the information of Congress under 6, in aid of the legislative power, it acts as a legislative agency. Under § 7, which authorizes the commission to act as a master in chancery under rules prescribed by the court, it acts as an agency of the judiciary. To the extent that it exercises any executive function -- as distinguished from executive power in the constitutional sense -- it does so in the discharge and effectuation of its quasi-legislative or quasi-judicial powers, or as an agency of the legislative or judicial departments of the government.

Got that?  If you somehow think that "carrying into effect legislative policies embodied in a statute" is the very essence of executive power, then I guess you just need to go to re-education camp.  And what about the idea that if the powers exercised by the agency are not executive, then they must be some combination of legislative and/or judicial, and therefore equally illegitimate?  The Court has the answer:  These are neither "legislative" nor "judicial" powers, because they are only "quasi-legislative" and "quasi-judicial" powers!  No problem then!  And how are we mere humans supposed to tell the difference between "legislative" and "judicial" powers on the one hand, and "quasi-legislative" and "quasi-judicial" powers on the other?  You won't find that answer here.  And yes, this is the entire basis on which the government has claimed the ability for four-fifths of a century to defeat the constitutional separation of powers, and transfer unaccountable executive, legislative and judicial powers all to the same people.

Remarkably, in the eighty-one years since this decision, Humphrey's Executor has never come up for serious reconsideration.  From time to time in the past couple of decades there has been the lonely voice of Justice Clarence Thomas pointing out the obvious illegitimacy of exercise of federal power outside of the three authorized branches, most notably in his recent concurrence in Department of Transportation v. Association of American Railroads in 2015.  But somehow, a frontal assault on the agencies has been avoided.

Which brings me to the perhaps equally bizarre decision a couple of months ago of the D.C. Circuit, per Judge Kavanaugh, in PHH Corp. v. Consumer Financial Protection Board.  The CFPB initiated a prosecution against PHH, which ended with an order from the CFPB for PHH to pay $109 million.  PHH challenged the authority of the CFPB under the constitutional structure of the government, for example in being free from control of the President by reason of the protections afforded the Director from being fired, as well as being free from Congress's power of the purse by reason of having a funding stream from the Federal Reserve.  The D.C. Circuit held the structure of the CFPB to be unconstitutional, but on the narrow ground that the CFPB has a sole Director, as opposed to the multi-commissioner structure of the other "independent" agencies like the FTC, FCC, SEC, etc.: 

The CFPB’s concentration of enormous executive power in a single, unaccountable, unchecked Director not only departs from settled historical practice, but also poses a far greater risk of arbitrary decision-making and abuse of power, and a far greater threat to individual liberty, than does a multi-member independent agency. The overarching constitutional concern with independent agencies is that the agencies are unchecked by the President, the official who is accountable to the people and who is responsible under Article II for the exercise of executive power. Recognizing the broad and unaccountable power wielded by independent agencies, Congresses and Presidents of both political parties have therefore long endeavored to keep independent agencies in check through other statutory means.  In particular, to check independent agencies, Congress has traditionally required multi-member bodies at the helm of every independent agency.

Fair enough.  But nothing in Humphrey's Executor relied upon the multi-commissioner structure of the FTC as part of the logic to save the agency.  If an agency violates the three-branch structure of the Constitution, then why isn't that the end of the matter, and of the agency?  

I suppose one way of looking at PHH is that the D.C. Circuit is bound to follow the precedents of the Supreme Court, so Kavanaugh could not challenge Humphrey's Executor.  Therefore, he came up with the most absurd possible reason for distinguishing Humphrey's Executor, thus making an obvious invitation to the Supreme Court to do the right thing when the case inevitably gets there.

So is there any chance that the basic principles of the separation of powers will get righted over the next several years?  I kind of doubt that President-elect Trump is even aware of this issue.   On the other hand, you can be sure that the current "liberal" wing of the Supreme Court is completely OK with the idea of completely autonomous and unaccountable federal agencies not subject to any sort of control or oversight.  And any nomination of Hillary Clinton to the Court would have been OK with that as well.  Trump?  He might even nominate Kavanaugh!  Or Randy Barnett!  Or Eugene Volokh!  You never know.