![Chairman of the U.S. Securities and Exchange Commission (SEC) Paul Atkins (R) as U.S. President Donald Trump looks on speaks during a summit of crypto and technology leaders in the Roosevelt Room of the White House.]](https://images.newrepublic.com/169578e6a53544d8896617cf1187623f7463c04f.jpeg?auto=format&fit=crop&crop=faces&ar=3%3A2&ixlib=react-9.11.0&q=65&w=1400&dpr=5)
If you doubt that President Donald Trump is successfully trashing the administrative state, consider a rule change that the Securities and Exchange Commission announced with little fanfare that took effect on October 2. Under the new rule, the SEC, which effectively until now has required a quorum of three to conduct business, will now require a quorum of only one.
At the moment, the SEC has two commissioners, both Republican. These are the Trump sycophant Paul Atkins, who serves as the SEC chairman, and the reliably pro-business Mark Uyeda, whom Trump appointed acting chairman before Atkins took office in April 2025. During Trump’s first term, Jim Chanos, a billionaire investment manager who predicted a year in advance the collapse of Enron, pronounced that America had entered “the golden age of fraud.” That was premature. In his second term, Trump is much more energetically pardoning financial fraudsters, and his SEC is more aggressively reducing transparency and slashing enforcement.
Even in the best of times, Republican administrations are much less keen than Democratic ones to enforce the nation’s securities laws. But Trump is taking moral laxity to stratospheric new levels. Perhaps Trump became more hospitable to white-collar felons after becoming one himself. Perhaps Trump is neutering the SEC so he doesn’t have to look over his shoulder whenever he trades stocks on insider information or uses his office to reward investors in his crypto business. Whatever the motive, going forward, our unitary executive will be able to indulge financial criminality more freely with a unitary SEC.
To help you understand how appalling this SEC rule change is, bear with me while I explain how the regulatory process works. You have Cabinet agencies like the Commerce Department or the Interior Department and you have independent agencies like the SEC, the Federal Trade Commission, and the National Labor Relations Board. Cabinet agencies are always headed by a single political appointee who answers to the president. Independent agencies are usually headed by a commission, or board, typically consisting of five Senate-confirmed commissioners (or board members). These commissioners serve staggered fixed terms, typically five years. When a sitting commissioner’s term ends, the president nominates a new one, but in doing so he must limit to a bare majority (typically three) the slots filled from his own party. For the remaining slots, he must nominate a person from the opposing party.
In practice, a president seldom must wait very long before an independent agency is controlled by a majority from his own party. An unfriendly Congress may resist confirming some commissioner or other on partisan grounds, but such standoffs are typically resolved when an additional commission slot opens for the opposite party. You want your guy? Then vote for my guy.
Trump, of course, famously lacks impulse control, and he doesn’t like waiting even a little bit to win a majority at any given independent agency. Consequently, he’s experimented with not nominating anybody to an independent agency if the next in line’s a Democrat, or, alternatively, firing sitting Democrats. Sometimes he’s done both. Firing a sitting commissioner without cause was, until this past June, illegal under the Supreme Court’s 1935 Humphrey’s Executor decision, which said President Franklin Roosevelt lacked the power to fire, without cause, a seriously obnoxious Republican commissioner on the Federal Trade Commission named William E. Humphrey, before Humphrey’s term ended. Humphrey obligingly dropped dead while his case made its way through the courts, but Humphrey’s heirs continued it on the grounds that he was owed back pay, which the final decision granted them. (Hence “Executor.”)
Ninety-one years later, however, a unitary-executive-besotted Supreme Court ruled in Trump v. Slaughter that Trump was perfectly free to fire, without cause, Rebecca Slaughter and Alvara Bedoya, two Democratic appointees to the Federal Trade Commission, before their terms ended. By extension, Trump is now free to fire any commissioner of almost any independent agency simply for being a Democrat. Thus far (not counting Cook) Trump has fired at least 21 Democrats (five of them his own appointees!). Through either firings or refusing to nominate a replacement when a Democratic term expires, Trump has managed to deprive the SEC, the FTC, and the Commodities Future Trading Commission of a single Democratic member.
The CFTC, which has neither a statutory quorum requirement nor an internal rule defining a quorum, represents Trump’s beau idéal. It’s operated for nearly one year with a single commissioner, Michael Selig, an enthusiastic cheerleader for crypto, prediction markets, and sports betting. “The era of political lawfare, debanking and regulation by enforcement is over,” Trump’s solitary cop on the commodities beat said in August. “Innovators … are welcomed to the White House, not railroaded to the big house.” In the CFTC we see unitary executiveship at its most uninhibited. Even before Selig got there, CFTC enforcement actions in 2025 were down 80 percent compared to the previous decade, according to NPR’s Luke Garrett.
The only independent agency still insulated from Trump under Trump v. Slaughter is the Federal Reserve, where the commissioners are called governors. In a separate ruling issued the same day, Trump was barred from firing the Fed Governor Lisa Cook. The legal justification for letting Trump fire Slaughter, Bedoya, and 19 other Democrats but not Cook was, as I understand it, the following:
Because we say so.
Apart from some mumbo-jumbo about the Second Bank of the United States, the justices enunciated no distinction between the Fed and every other independent agency. This reactionary majority simply values the Fed—where political meddling could put its stock portfolios at risk—much more highly other regulatory agencies.
Trump v. Slaughter freed Trump to stop independent agencies in their tracks. But depriving them of a quorum turns out to be too clever by half, as I pointed out a month after Trump returned to office. That’s because Trump needs these agencies able to function so they can overturn regulations and rulings left behind by President Joe Biden.
A nice illustration came in June when Trump’s new best friend Jeff Bezos lost two Amazon cases before the National Labor Relations Board because Trump had denied the NLRB a quorum. In one case, an administrative law judge had to uphold a Biden precedent, and in the other case the NLRB actually possessed a quorum but followed a genteel board tradition not to overturn any precedent by fewer than three votes, which it didn’t have. Three months later, the NLRB had a quorum sufficient to reward Bezos and Amazon with three legal victories in two employee misclassification cases in which Amazon truly had no leg to stand on.
For Trump, the lesson should be: Play it straight! Nominate commissioners in timely fashion and you won’t have to wait long to get your working majority. Rush the process by firing commissioners, or by not nominating new ones, and you may deprive yourself of the quorum necessary to overturn Democratic precedents and do the business lobby’s bidding.
But the SEC’s new maneuver points to a third option: the one-person commission.
Even before the rule change, the SEC’s quorum requirement was, at least formally, fairly lax. Under a 1995 rule, three votes constituted a quorum if that agency had three or more commissioners. If it had two commissioners, or even one, then two or one could constitute a quorum on a sort of emergency basis. However, if the number of voting commissioners in a particular case was reduced by one or more recusals, then a minimum of two votes was still necessary to establish a quorum. This seemingly minor exception had the practical effect of imposing in nearly all instances a three-person quorum.
Let me explain. Recusals (that is, non-participation based on a conflict of interest) are extremely common at the SEC because so many commissioners come from the world of finance. In 2013, The Wall Street Journal estimated that more than half the SEC’s enforcement decisions required recusals from one or more commissioners. Given such a conflict-clogged environment, the SEC couldn’t until now easily tolerate many vacancies. The practical result was that the SEC almost never made a ruling with fewer than three commissioners—and if there was a single instance in which it ever made a ruling with only one commissioner I can’t find it.
John Reed Start, who was an SEC lawyer at the time the 1995 rule was implemented, wrote on LinkedIn that its provisional allowance for a quorum of two or one commissioners “was a stopgap, nothing more, and everyone assumed five commissioners would eventually be in place.” Indeed, according to Robin Wigglesworth of the Financial Times, with one exception (a six-month period in 2008) the SEC has never in its 92-year history operated without a member of the minority party.
In essence, the new SEC rule routinizes what was previously only a theoretical one-person quorum and renders unnecessary the appointment of any minority-party commissioners. The White House need no longer fret about the composition of the SEC. Trump can not only stop nominating pesky Democrats; he can stop pushing any SEC nomination through what Nate Silver predicts will be a Democratic Senate.
SEC Commissioner Uyeda’s term lasts through much of 2028, and if nobody is nominated to succeed him it can be extended through the rest of Trump’s presidency (and perhaps several months into the next). But if Uyeda’s term isn’t extended—or if Uyeda must recuse himself from this or that case—SEC Chair Atkins can act as Trump’s one-man quorum for the remainder of Trump’s presidency, because Atkins’ term doesn’t end until 2030. Granted, under Trump v. Slaughter any Democrat who succeeds Trump can (and probably will) fire Atkins promptly on January 20, 2029. But if a Republican succeeds Trump, Atkins could end up running the SEC as a one-man band for years.
You can’t pull this trick at every independent agency, because for some—the NLRB, for instance, or the Federal Communications Commission, or the Equal Employment Opportunity Commission— the enabling statute specifies a three-person quorum. The 1934 statute that created the SEC, however, imposed no quorum requirement; the previous quorum requirement, dating to 1995, was simply a rule, and rules can be changed. Big rule changes require a period of public comment, so the SEC decided this was a little rule change that didn’t require public comment. But of course it isn’t a little change at all.
When the president commands a majority at an independent agency, that agency makes decisions in at least rough accordance with the president’s views. Why, then, should we care whether members of the opposite party are present to register dissent? Because, Senate Banking Committee Democrats wrote the White House in June, “a full slate of commissioners and board members can bring a range of perspectives to policies that shape our markets.”
This may strike a discordant note in the current political environment, but there’s practical value in being compelled to listen to the arguments of people who disagree with you. That’s why independent agencies were set up to include minority-party representation. When the president is as corrupt as Trump, the minority-party function extends to bearing witness. Thus Caroline Crenshaw, the last Democrat on Trump’s SEC—she left this past January—was able to alert the public the previous May that “we’re playing a game of regulatory Jenga…. The tower remains standing when you pull out a block or two here and there. But, how many blocks can you pull before the tower gives way?”
In a September 30 letter to the SEC, a shareholder activist named James McRitchie quoted several past and present SEC commissioners about the virtue of the SEC’s bipartisan structure. One of them, ironically, was Uyeda, who I presume must have voted in favor of the SEC’s new rule change (otherwise it would have deadlocked 1-1). Here’s what Uyeda said:
The Commission is structurally designed to promote regulation that is the product of consideration by five individuals with different perspectives. The underlying statute that created the Commission requires that the commissioners come from different political parties, with no more than three being from the same party. I view this arrangement as creating a basic bargain that the SEC will enjoy a degree of independence….
Amen. But what changed Uyeda’s mind after he spoke these words? The presence of a Republican in the White House. Uyeda delivered the above remarks in 2022, when Joe Biden was president and Uyeda was a lowly minority-party SEC commissioner. Now that Uyeda’s aligned with the White House and the SEC has gone almost a year without any minority-party commissioners, I suppose he’s come to appreciate the peace and quiet. But Uyeda will rediscover the virtues of “different perspectives” when Democrats retake the White House. When that happens, Democrats should honor independent-agency norms, restore space for the opposition, and above all abolish the one-person quorum.
