The US used hull numbers at first, naming each new class with a letter, until the realized when getting to the "U" that they were about to name the subs same as the german ones. Thus the fleet boat classes P1, P2, P3 etc and T1, T2, T3 were renamed with fishes names that started by that letter (Perch, Pickerel, Permit, Pompano...) (Tambor, Tautog, Thresher....). Later that was also discontinued and simply fish names were given, the main reason being the huge amount of subs of each class being built (Not enough fish names starting with that letter). In all cases, the decission seemed to come from the high staff at the moment of ordering and comissioning the boats. AFAIK no sub commander or even squadron or division commander (Admirals already) had the power to change the ship names or choose it. They were already ordered and built with a name, which stayed normally through all its life.
It is also a widespread naval tradition all around the world in many navies to keep the name of a ship unless it changes the nation it belongs to (Sometimes not even so). In the age of sail, it was usually considered that because ships were christened like persons, changing their name would bring bad luck.
AFAIK the only US submarine that changed name during her life was USS Squalus (SS-192), Salmon class, after it went down during trials due to the faulty air-induction valve. When repaired and recomissioned, the name was changed to USS Sailfish, though it kept the hull number (192).
EDIT: Found the correct answer, its is the Secretary of the Navy. Read it here: http://www.history.navy.mil/faqs/faq63-1.htm
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