Winners & Losers in the Supreme Court Term

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1:45This is Bloomberg Law with June Grosso from Bloomberg Radio. It was a Supreme Court term in which the conservative Republican supermajority transformed the law in several notable ways. Expanding presidential power, gutting a landmark civil rights law, enhancing gun rights, and eliminating campaign spending restrictions. A term where the ideological differences on the court were never more apparent, with nearly a quarter of all rulings six to three with the Republican appointees in the majority and the Democratic appointees in dissent. That's up from 11 percent last term. My guest is an expert in constitutional law, Michael Dorff, a professor at Cornell Law School.

2:34Mike, let's start with presidential power. The court blocked Trump's tariffs, rejected his attempt to end birthright citizenship, and prevented the immediate firing of a Federal Reserve governor. But the court gave Trump and future presidents greater control over federal agencies, allowing them to fire top federal regulators, even if Congress didn't intend that. And in the immigration area, the court allowed Trump to pursue his aggressive immigration agenda in just about every case. So on the whole, did Trump win or lose this term? I think that you have to say he won because in the cases in which he lost, his position was so extreme that even getting the Supreme Court to divide on the issue was kind of a victory.

3:29It moved the Overton window to the right, or in this case, to the direction of greater executive power. So, you know, in Cook, for example, that's the case with the Federal Reserve governor. He gets most of the conservatives to sign on to his position that what he did was enough under the statute to fire a member of the Fed and that effectively, if that position had prevailed, would have given him control of the Federal Reserve. He came very close to getting that. Likewise, with respect to birthright citizenship, which, you know, nobody was even talking about as part of, you know, what we thought was reasonably contestable prior to the president's executive order there.

4:13He gets, you know, a 90-page dissent by Clarence Thomas. He gets Justice Alito, Justice Gorsuch to propose various alternatives, all of which take seriously this theory that most serious historians say is based on, you know, chewing gum and old newspapers that are sort of cobbled together from out-of-context quotes from the Reconstruction era. And yet he almost wins there. And then when you look at the wins, the wins are huge, right? So in the Slaughter case, which is he gets to fire members of the Federal Trade Commission, court overrules a 90-year-old precedent in Humphrey's executor. And this gives him, you know, nearly complete control of what were formerly independent agencies.

5:03There's this tiny carve out for the Fed in the Cook case, but it looks like that carve out is going to be available only there and maybe with respect to non Article three judges who are also distinguished. But it also suggests even further sweeping presidential power. So, for example, the dissent points out that the majority's rationale for upholding the president's power to fire people at will would seem to apply to civil servants as well, not just heads of agencies. There is this case, Parsons, in which the court in the 19th century had upheld these sorts of restrictions for civil servants. The court doesn't overrule it because it's not before the court, but the rationale would seem to apply because the idea is if somebody exercises executive power and they can't be fired, if that undermines the president as the head of the executive branch, it doesn't matter how low they are in the line of authority.

6:04If their boss can't fire them, then the president can't supervise them. So I think the civil service is potentially in the firing line next. And even in the extreme cases like birthright citizenship and the tariffs, two of the most conservative Supreme Court justices, Clarence Thomas and Samuel Alito, always found reasons to side with Trump. Would you say exemplifying the real split in the court? So I guess to be fair, if I were, you know, putting aside my druthers, you might say, well, you know, in all those cases, Sotomayor, Kagan and Jackson vote against Trump. And that, you know, that is true.

6:44That is to say that this is an ideologically divided court. I think the best way to think of it is that it's a court that has sort of three and a half center right judges. It's got two and a half extreme right judges and then three liberal justices, including Justice Gorsuch in the sometimes centrist, sometimes on the extreme right, because that's how he votes, except in cases involving Native Americans, in which he's the most liberal justice in the history of the Supreme Court. And, you know, that's just where they are. What's striking, I think, is that for the most part, with a few exceptions for Justice Thomas on cases of relatively low salience, for the most part, the ideological divides are also partisan divides.

7:31So the place where I think this is most apparent is in Louisiana against Calais, which is the Voting Rights Act case. Even though it's not technically about executive power, we know that it was going to be and has been leverage for redistricting for partisan ends by Republicans, which was a top priority and continues to be a top priority of President Trump. And there, what's, I think, very revealing is how utterly closely the sort of conservative ideological position aligns with the Republican partisan position. So, you know, the conservative ideological position is government shouldn't use race as a criterion for anything.

8:23Constitution is colorblind. And, you know, in the past, that proposition has sometimes operated against the partisan interests of the Republican Party. So if listeners who are old enough will think back to the late 80s and early 1990s during the George H.W. Bush administration, there was some indication that the creation of minority majority districts was going to undermine the interests of the Democratic Party. because by concentrating black voters into a few small districts, you reduce the number of mixed districts that Democrats might win. That was before the South fully realigned. And so until very recently, taking the view that there's certain views about race in voting could scramble ideological alliances.

9:29That's not true here. In Louisiana against Calais, what the court says is, well, political gerrymandering is fine, and therefore we're not going to find any kind of race discrimination against minority voters sufficient to create a majority-minority district. And the result will be we're going to empower Republican controlled state legislatures to engage in political gerrymandering that is also de facto racial gerrymandering. So you can now have your ideological cake and eat your politically partisan cake as well. Let's turn then to voting in elections because the court gutted the Voting Rights Act.

10:17I don't know what's left of the act at this point. And that, again, was six to three, as was Louisiana Calais. So, I mean, it's been said that this is something that the chief justice has had on his agenda, shall we say? We saw the first part of the attack on the Voting Rights Act in the case of Shelby County versus Holder. Right. So you can think of it as a one-two punch. So So in Shelby County against Holder, they said that the coverage formula of which areas were subject to preclearance was unconstitutional. And so that eliminated the executive branch as the enforcer of the Voting Rights Act.

10:57What they did in the Calais case this term was to say that the threshold for finding that there has been improper use of race is so high because it's so hard to distinguish in their view between racial and political gerrymandering that effectively now you've taken the judiciary out of the picture. What's left, I think, right, since you can no longer say that disparate impact is sufficient, what's left is to say that if state legislators are stupid enough to expressly say we are gerrymandering here because we have racial animus, well, then that's a violation of the Voting Rights Act. And that just seems extraordinarily unlikely.

11:48Yes, because in the Alabama case, a three-judge panel had found that the state did intentionally discriminate against black voters. But the Supreme Court ignored that, basically. Shouldn't they have accepted the facts as the three-judge panel saw them instead of making their own conclusions? Yes, I think what they would say is that the lower court did not give adequate force to the possibility that this was all just political gerrymandering. The way that they put it is that in order to show race discrimination, the plaintiffs need to construct an alternative map that achieves all of the goals of the legislature, including protecting incumbents and partisan gerrymandering.

12:42And if only then if you can do that and show that you could have an additional majority minority district, only then have you shown anything. But of course, given the way that, you know, people are concentrated and given the strong correlation between race and voting patterns, that's going to be virtually impossible. So to my mind, it's not just the Shelby County case that tees up Calais. It's also Rucho against Common Cause, which is the case from a number of years ago in which the court says that challenges to political gerrymandering are not justiciable, meaning they can't be heard by federal courts.

13:24And then the transformation of that holding from the proposition that it might be unconstitutional, but there's nothing the courts can do about it, to the proposition that partisan gerrymandering, you know, it's not just a sin we can't block. It's a virtue somehow. And so that's the key move. The court made it in an earlier case, but they really run with it in Calais because without that, the plaintiffs win. It's only because the plaintiffs can't reproduce the same maps and get the partisan gerrymander that the court is able to reject the plaintiff's case. Coming up next, more on the Supreme Court term with Cornell Law professor Michael Dorff.

14:05A losing term for LGBTQ rights once again. This is Bloomberg. Support for the show comes from Public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip. manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow, and your agent handles the rest.

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15:20Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated. for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

15:59Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work.

16:40Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. In three election law cases before the Supreme Court this term, the justices gutted a key provision of the Voting Rights Act in a 6-3 decision down ideological lines. Struck down limits on coordinated spending between political parties and candidates, again an ideological split, 6-3. However, the court did uphold the state's ability to count mail-in ballots postmarked by Election Day, but received later. I've been talking to Professor Michael Dorff of Cornell Law School.

17:24Mike, in a pretty high-profile case involving mail-in ballots in Mississippi, and whether that state could count mail-in ballots that are postmarked by Election Day, but received later. And that decision was five to four with the chief justice and Justice Amy Coney Barrett joining the court's liberals in the majority. That gave the Democrats a rare victory at the court. Were you surprised by that decision? I wasn't terribly surprised, partly because although this has been a priority of President Trump, right, to go after mail-in ballots, it hasn't been a priority of the Republican Party because it doesn't actually benefit the Republican Party as such.

18:11The parties both take advantage of mail-in voting. I mean, the fact that it was Mississippi tells you something. Mississippi is a deep red state, but they're the ones who are defending their particular timing rules. The other problem for the argument against this is that if you take it literally, then, you know, what about the fact that there's early voting in a lot of states? So it would really have been extremely disruptive of the way that many states, both red and blue, conduct their elections. And without the clear partisan valence, it didn't surprise me. The court struck down limits on coordinated spending between political parties and candidates.

18:54And that also was six to three. Yeah. So that case, you know, you can think of that in the same category of cases going back to Citizens United, where the court is taking a very restrictive view of what Congress can do to regulate campaign finance. finance. And one of the criticisms of Citizens United is that the court was sort of naive about the way in which money affects politics, saying, well, you know, if someone makes an independent expenditure, that's not going to buy a candidate. But of course, the candidates know that that's going on. Same thing is true here, right? The court says, well, you know, of course, parties are going to coordinate their campaigns with the candidates.

19:42That's true, but that's not what coordination is about. As the dissenters point out in the case, the whole point of this restriction was to prevent circumvention of the limits on giving money to an individual candidate, right? So you can only give, you know, probably about$4 ,000 in the next campaign cycle to a candidate once for the primary and once for the general election. But if you can give, you know, hundreds of thousands of dollars to the party and then have that earmarked for that candidate, well, then you've essentially, here's that word again, gutted the campaign contribution limits with respect to individual candidates.

20:22I think that is the goal of the Roberts court here, frankly. Elena Kagan, during the oral arguments and in her dissent, made it pretty clear. I mean, it's wink, wink, nod, nod, or not even how this is going to work out in the end. One of the criticisms of the Citizens United, which comes from an exception that goes, it was in the Buckley against Vallejo case all the way back in 1976. One of the criticisms of that case is that if you have low limits on contributions to candidates, but no limits on independent expenditures, you essentially eliminate or greatly reduce the disciplining effect of candidates having to stand behind the message.

21:07So, you know, when a candidate says, I'm, you know, Joe Schmo and I endorse this message, right, you don't see that when you've got an independent ad, you know, on, you know, Americans for a Better America, but it's actually in favor of candidate Joe Schmo, and they can say anything they want and then Joe Schmo has plausible deniability. By allowing greater coordination between the parties and the candidates, you create some additional bonds which could result in some greater disciplining force as opposed to making everybody just a kind of independent agent who can say whatever they want. So I've seen some people who favor campaign finance regulation and say, given everything else that goes on, it's actually not such a bad thing to allow coordination between parties and candidates.

21:58We shall see, I guess. But I mean, so talking about Roberts always saying, you know, we're not politicians in robes, and we're different from the political branches. But when you have these election cases, and it comes down to Republicans versus Democrats on, you know, for example, setting off that redistricting in the southern states, and, And, you know, this coordinated spending and the Voting Rights Act, I mean, doesn't it paint the court as more political? Yes. And I would add that this is exacerbated by the fact that, you know, in recent years, we've had a court in which the most liberal Republican appointee is nonetheless much more conservative than the most conservative Democratic appointee.

22:49that wasn't always true. And it wasn't true in a big way in periods that are still within living memory. So certainly during the Warren court, right, the two most influential liberal justices were Earl Warren himself and William Brennan, both of whom were appointed by President Eisenhower, who's a Republican. You know, it wasn't all that long ago that this court still had David Souter, Sandra Day O 'Connor, John Paul Stevens, Anthony Kennedy, all of whom were Republican appointees who to one degree or another had a liberal or moderate streak. It's been a while since we had the last conservative Democrat.

23:34That was probably Byron White. But the reason why it's been a while is because there's so few Democratic appointees lately. And so I think that the fact that we have such a partisan court and visibly partisan court is partly to do with greater polarization in our politics. You know, the era when you had moderate to liberal Republicans was an era when you still had New England and Midwestern Republicans who were liberal on a lot of issues. And you had Dixiecrats who were conservative on a lot of issues. And so it wasn't that unusual for a Republican president to appoint a moderate to liberal or a Democratic president to appoint a moderate to conservative.

24:19That just doesn't happen anymore. And so now you're seeing this perfect alignment of ideology and partisan politics. Support for the show comes from public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions, buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like if the VIX hits 25, buy a put option on the S &P 500. Or if my cash balance goes above$20 ,000, move the excess into my direct index.

24:55You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions and executing your strategies exactly as defined. An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., Member FINRA, and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures.

25:36Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

26:14Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work.

26:55Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. Let's turn to LGBTQ rights. And these always seem to be ideologically divided with the liberals in dissent. So you had the court upholding state bans on transgender athletes competing on girls' school sports teams. I mean, I don't think anyone ever expected that the conservatives were going to vote any which way besides upholding these bans. Well, the reason to have some hope, it was a hope that was dashed, but the reason to have some hope was the fact that in the Bostock case back in 2020, the Supreme Court, in an opinion by Justice Neil Gorsuch, joined by Chief Justice John Roberts and the more liberal justices, said that Title VII, which is the federal employment discrimination statute, when it forbids sex discrimination, also therefore forbids discrimination on the basis of sexual orientation.

28:01and transgender status. And this case arose under both the Equal Protection Clause of the 14th Amendment and Title IX of that same Civil Rights Act. And Title IX is broadly similar to Title VII. So there was at least a prima facie, that is, you know, first instance argument that what's true of Title VII should be true of Title IX. Now, there were reasons to think that, as the court ultimately held, that might not work. Part of it is there's this provision in Title IX, adopted a couple years after the adoption of Title IX itself, called the Javits Amendment, which allows for sex-segregated athletic teams.

28:43There's no parallel allowance in Title VII. But still, the so-called Bostock analogy was pretty powerful. I should say, it turned out not to be that way. Even the liberal justices rejected the statutory claim, although they accepted the equal protection claim. If you're viewing it from a, you know, social policy lens, like, you know, how far is this court going to go? I think I shared your view going into the case and certainly after the oral argument that there weren't going to be the votes there to say that what the states were doing in these cases was unlawful. But that doesn't mean that the legal argument was so bad.

29:23It just means that you look at the justices and you think they're not ready for this. And to be fair, the argument for excluding transgender women from women's sports and transgender girls from girls' sports is, at least in many cases, stronger than it is for keeping out someone who's gay or trans from just any job. And so the result was not especially shocking. for that reason. You put it into context what this court has done this term and in prior terms. So this term, besides the transgender sports case, the court struck down Colorado's ban on conversion talk therapy for LGBTQ minors, which every medical association says is not healthy for minors.