CHEVRON DOMINANCE

Technology is about to accelerate because Chevron deference is over and regulators can’t just make up laws anymore. So, countless new startups just became feasible. This is often spoken about in the abstract, so let’s do three examples and two visuals.

THREE EXAMPLES:

1) Genomics. Did Congress explicitly give FDA authority to regulate genetic tests in a bill like Kefauver-Harris (1962) or PDUFA (1992)? No, it did not.

But in the early 2010s, FDA attacked 23andMe and forced them to take personal genomic tests offline.

Implicitly, this was under Chevron.

2) Nuclear power. Did Congress explicitly give EPA and NRC the authority to implement ALARA? No, it did not.

But these agencies came up with this “as low as reasonably achievable” standard, forcing nuclear energy to become as expensive as other energy sources by spending all the cost-savings on “safety.”

Implicitly, this was under Chevron, too.

3) Cryptocurrency. You guessed it. Did Congress explicitly give the SEC authority to regulate crypto? No, it did not.

Cryptocurrencies didn’t exist when the 1933 and 1934 acts were written. However, the SEC says it has regulatory authority over crypto, even when Congress is deliberating on bills to the contrary.

Implicitly, that claim of SEC authority too was under Chevron.

In other words: if a regulator can’t point to the law that gives them the power, they may not have the power. And you might be able to win in a court of law.

So, for technology, the overruling of Chevron could literally reopen innovation in the physical world.

This is on par with the 1991 opening of the Internet to commercial traffic. It deprecates the 20th century regulatory state.

All the safety theater and security theater that they optimize for sounding good while actually being bad now has to face judicial scrutiny.

TWO VISUALS How to visualize something as abstract as Chevron reversal? Well, Chevron is the company on which the 1984 Chevron deference case is actually based.

Its logo had the arrows pointed down. But now that Chevron has been reversed, we’re headed up.

And that’s one way to visualize what reversal means: from Chevron deference to Chevron dominance, because rule-of-law now dominates the lawless regulatory state.

If the regulator isn’t specifically authorized by statute, they can’t invent some regulation to stop your innovation.

But there’s a second way to visualize the reversal of Chevron: regulators just got disarmed, in the most literal sense because, ultimately, a regulation is a threat of state force.

If you disobey one of a regulator’s made up rules, they eventually get a cop to point a gun at you, implicitly or sometimes very explicitly.

The photo above is from the 2010 FDA raid on Rawesome Foods for selling raw milk to club members that consciously opted in to eating and drinking foods of their own choice.

This may have also been done under Chevron deference because FDA only has the right to regulate interstate commerce, and not commerce within one state (which is all that Rawesome was apparently doing at that time).

To be clear, I don’t have a position on raw milk other than I do think people should be able to choose their own foods.

In their lawsuit against the Farm To Consumer Legal Defense Fund, FDA strongly disagreed, contending that “there is no generalized right to bodily and physical health” and you “do not have a fundamental right to obtain any food they wish.”

These are real quotes from the now-defanged regulators; see the PDF link below.

Anyway — now you get a sense of how big a deal the Chevron reversal is, and how out of control regulators can get.

The Chevron reversal strips regulators of the ability to make up random rules. It calls all their existing made-up rules into question.

And it gives you the power to ask where in the law it says they can make up some new rule.

You know that saying — the only way they can stop you is to shoot you? Well, now they can’t shoot you as easily.

So we’re going from Chevron deference to Chevron dominance. I can already feel the T-levels across tech increasing.

Balaji is a poster on X (formerly Twitter) and can be found at @Balaji.