The Logic of Easily Reversible Lame-Duck Actions

In the final days of the Biden administration, we are witnessing a whirlwind of activity and announcements. Some of them are irreversible--such as Biden's granting of clemency to all but three people on federal death row and the pardoning of others (including Hunter Biden). Others are unlikely to be reversed because they align with the policies of the incoming Trump administration--such as the unusual cooperation between the outgoing and incoming administrations in promoting the ceasefire to which Israel and Hamas have (at least tentatively) agreed. Still other policies adopted through administrative action are at least partially entrenched because of the procedural hoops through which a new administration must jump in order to rescind at least some forms of regulatory actions.

Taking actions that can't be reversed, won't be reversed, or can't easily be reversed make sense. But what are we to make of those actions of the Biden administration that can and almost surely will be reversed almost immediately after Trump takes office? I have in mind at least the following: (1) the SEC lawsuit against Elon Musk for violating disclosure rules in the runup to his purchase of what was then Twitter; (2) the removal of Cuba from the list of state sponsors of terrorism; and (3) the proposal by Surgeon General Vivek Murthy to label alcohol as a risk factor for cancer. The new administration can: (1) drop the suit against Musk; (2) reinstate Cuba on the list; and (3) fail to proceed to label alcohol. Thus, why bother?

With respect to Cuba, there is a possible answer: the Pope (with whom Biden has a positive relationship) sought the change and in exchange obtained an agreement from Cuba to release hundreds of political prisoners. However, that doesn't get us very far, because Cuba hasn't committed to any details, and if, as one expects under a State Department headed by Marco Rubio, Cuba ends up back on the terrorist list, the Cubans will likely abandon their end of the deal as well. So that remains a mystery.

However, the SEC suit and the alcohol labeling proposal are quite easy to understand. They are efforts to place material on the record and thus lay the groundwork for some future administration to regulate or, where applicable, private parties to bring suit. The SEC complaint linked above portrays Musk as a market manipulator who cheated shareholders in Twitter.

To be sure, Musk's ultimate plan was idiotic if judged purely in terms of the value of the company he obtained. As of last fall, the company Musk acquired for $44 billion was valued by one reasonably reliable estimate at under $10 billion. However, Musk's deployment of X as an unofficial arm of the Trump campaign probably contributed to the latter's success, which in turn will generate billions of dollars in government contracts for SpaceX, perhaps rendering his loss-leader move with respect to Twitter/X cost-justified in the final calculus of crony capitalism. In any event, whether Musk's purchase of Twitter was foolish or not, and whether or not he made money, he was obligated to abide by the disclosure rules. By getting out into the world the accusation that Musk didn't, outgoing SEC Chair Gary Gensler brands Musk a lawbreaker--which could have consequences in the future.

Murthy's proposal with respect to alcohol likewise lays down a marker. The proposed label is part of what he did. The rest was the release of a report that documents how alcohol consumption increases cancer risk. Even if Trump's nominee for Surgeon General, Janette Nesheiwat, were to rescind the report, it won't exactly vanish.

Judicial dissents could be thought to be a useful analogy. A dissent, by definition, does not have any immediate real-world impact. If it persuaded enough other jurists, it wouldn't be a dissent. The point of a dissent is partly for a judge to explain their reasoning, but it can also be a missive aimed towards future change. The most famous examples in U.S. law are the dissents by Justices Brandeis and Holmes in free speech cases in the First Red Scare era. They laid down principles that would become the governing law four decades later.

One would imagine that Biden, Gensler, and Murthy are hoping for a quicker about-face, targeting the next Democratic administration (assuming the U.S. continues to have elections in which Democrats can win the White House) rather than distant posterity. And even before that, as I noted, there could be ripple effects of their actions, whether via private lawsuits, state laws, or the kinds of attitudinal shifts that lay the groundwork for lasting change later.