Signed, Sealed, Decreed: The Power of Presidential Executive Orders
This week, we are taking a second to dig into presidential executive orders. This is a timely topic as the President has been issuing quite a few in his first month of his new term. I’m sure you have questions, and I hope to answer them. So, let’s get started!
A Brief History
Executive orders, believe it or not, have been around since George Washington was President. Article II of the U.S. Constitution gave the President of the United States executive power over the federal government. Historically, executive orders have been used by presidents to manage executive branch operations and to direct federal agencies. The purpose was not to implement new laws; however, we have seen modern executive orders implement various policies and programs. Another interesting tidbit is the presidential utilization rate of this tool. President William Henry Harrison didn’t issue any while President Franklin D. Roosevelt issued a whopping 3,721 executive orders during his time in office! If you’re a history nerd like me, you can check out this link that shows all the presidents and the number of executive orders they signed. Now let’s jump back to the present day.
What is an Executive Order?
An executive order is a written directive from the President of the United States that manages the operations of the federal government. Executive orders are signed by the President and published. An executive order is not the same thing as legislation. Executive orders do not require approval from Congress and Congress is not able to simply overturn them. The only tool that Congress has to “combat” or “undo” an executive order is to pass legislation that would make it difficult or even impossible to carry out the executive order. The only person who can overturn an executive order is the President.
What is the Legality of Executive Orders?
Executive orders are legally enforceable. However, an executive order cannot override constitutional rights or federal laws. If a person or group (party) feels that an executive order has done either, and it is determined that they have standing, they may challenge the legality of that executive order.
What is legal standing? To have legal standing, a party must demonstrate a sufficient connection and harm from the law or action that they are challenging.
What is the Impact on Federal Agencies?
Executive orders that are directed at a federal agency (or agencies) asking them to take specific actions or enact policies must be complied with. However, only those executive orders that impact agency operations and priorities are “legal.” Any executive order aimed at overriding federal law or constitutional rights as said above are not valid.
Key Takeaways?
Executive orders are nothing new at both the state and federal level and every president utilizes them in varying degrees. We are likely to continue to see Pres. Trump issue executive orders during his first 100 days and probably throughout his term. We are also likely to see various groups challenge the legality of these executive orders as well (again, nothing new).
To sum it up…
The impact of executive orders on federal agencies and the federal government will be interesting to see as we continue in 2025. With the CFPB on the chopping block, will we see a complete dismantling of the agency? Consolidation of other agencies? We will just have to wait and see. I renew my request for a crystal ball!
One thing is certain, the MCUL team will continue to keep you apprised of everything happening at the state and federal level throughout the legislative session, so stay tuned!
As always, this article is intended for general information only and does not constitute legal advice. If you have any questions about these topics and/or the possible implications, you should contact your attorney for advice.
Hope to see you next time, when we take a second to discuss another legal topic impacting the financial services industry!
« Return to "Take a Second CU Legal Insights"
