by D.T. Armentano, Mises.org
Article one Section 8 of the U S Constitution states that the “congress shall have the power to regulate commerce among the several states….” This so-called “commerce clause” is the legal bedrock for all federal regulation of business activity that crosses state lines. Every piece of federal economic regulation from the Sherman Antitrust Act (1890) to all of the 1930s New Deal securities and banking law has been rationalized (made “constitutional”) by reference to the commerce clause.
In Wickard v. Filburn (1942) , the Supreme Court expanded the original interpretation of the commerce clause to cover intrastate economic activity that was said to “affect” interstate commerce. Wickard grew wheat for his own consumption but the court reasoned that the wheat locally consumed could, theoretically, have been sold in interstate commerce; so when Wickard “withdrew” that wheat and consumed it, output and prices in interstate commerce were affected.
Hence the Feds could regulate locally grown wheat and the legislation that prescribed that was constitutional. The “logic” of Wickard obliterated two original and important constitutional principles, namely (1) that the states can regulate their own commerce, not the Feds and (2) that the federal Constitution embodies only limited and clearly enumerated powers.
Wickard substantiated the notion that the Feds could now regulate ANY economic activity (with little resistance from individuals or the states) since almost ANY good or service produced and consumed locally could, at least theoretically, affect interstate commerce.
We have all lived in a post-Wickard regulatory world ever since. So in some sense, the medical marijuana case decided June 6th, 2005 (Gonzales v Raich, et al..) in favor of the government (6-3) was an easy slam dunk (see also S. Kinsella’s post on the topic).
Reich and the other defendants in California grew marijuana for their own consumption but the majority asserted, following Wickard, that such private activity “affected” interstate commerce and, thus, could be regulated (prohibited) by the federal Controlled Substances Act (CSA), regardless of California state law which allowed (with supervision) such activity. If you don’t like the decision, the majority suggested, get the votes and attempt to change the federal drug laws.
There are many problems with the majority opinion written by Justice Stevens. The most obvious is the continued acceptance of the logic of Wickard. As Justice Thomas argues in his brilliant dissent, if growing 6 marijuana plants on your own property for your own consumption is “economic activity” that can “affect” interstate commerce, then there is absolutely nothing under the economic sun (including pot luck dinners) that cannot be regulated by the federal congress. But, clearly, that was not the intent of the framers of the Constitution.
But even more fundamentally, the Commerce Clause itself was never meant by the Founders to be a blank check for “command and control” economic regulation. Indeed, the economic purpose of Article one Section 8 was almost precisely the opposite of the conventional explanation accepted by the majority in this case.
The original intent of the Commerce Clause was to make “normal” or “regular” commerce between the states; thus it was designed to promote trade and exchange not restrict it. Further, it was specifically aimed at preventing the states from enacting impediments to the free flow of “commerce” such as tariffs, quotas and taxes.
And since the explicit language of the CSA, like all economic regulation, interferes with the free flow of commerce, it is inherently antithetical to the original intent of the Commerce Clause. (Whether the law could be legitimized by reference to the “police powers” of the state is another matter).
The commerce clause was never meant to prohibit sick individuals from consuming plants grown on their own property. Yet to acknowledge that fact, the Supreme Court majority would have had to rethink the core principles of individual liberty and the entire legal foundations of our regulatory society. And that they chose not to do.
Dominick T. Armentano is professor emeritus at the University of Hartford, an adjunct scholar of the Mises Institute, a member of the editorial board of the Quarterly Journal of Austrian Economics, and author of Antitrust and Monopoly: Anatomy of a Policy Failure and Antitrust: The Case for Repeal
Copyright Mises Institute, Licensed under Creative Commons Attribution 3.0
“We do not agree.” is what the Court decided in the above cited case.
“In its effort to control total supply, the Government gave the farmer a choice which was, of course, designed to encourage cooperation and discourage noncooperation. The farmer who planted within his allotment was, in effect, guaranteed a minimum return much above what his wheat would have brought if sold on a world market basis. Exemption from the applicability of quotas was made in favor of small producers. [Footnote 30] The farmer who produced in excess of his quota might escape penalty by delivering his wheat to the Secretary, or by storing it with the privilege of sale without penalty in a later year to fill out his quota, or irrespective of quotas if they are no longer in effect, and he could obtain a loan of 60 percent of the rate for cooperators, or about 59 cents a bushel, on so much of his wheat as would be subject to penalty if marketed. [Footnote 31] Finally, he might make other disposition of his wheat, subject to the penalty.”
The appellee had obviously entered into a contract, and then tried to weasel out of its terms.
Contracts are protected under the federal constitution, unless they are found to be illegal. This one wasn’t.
Cry unfair all you want. This will still be a poor example of Constitutional illustration.
B. Johnson: “What’s interesting about these [11th & 16th] amendments is that they were proposed by Congress, not by the states.”
Good point to start a paradigm shift.
Was Congress given the power to amend its own charter? I think not. Is there any other way that the radical change in U.S. government with the 11th, 16th, and 14th amendments could be rationalized? Yes, there is: Congress is legislating for ITS OWN corporations and persons; those in its forts, enclaves, territories, and its seat of power.
The U.S. government got its hands slapped in Butler for connecting an inducement with the benefits it gives ITS franchises. They figured this out by the signing the Social Security Act of 1935. Study it — there is NO CONNECTION between the SS taxes and the SS benefits.
The states and state citizens were unaffected. They only needed to claim their immunity.
Oops! Sorry. This was supposed to be linked to the B. Johnson post following.
My problem with Wickard v. Filburn is the following. The Court had decided United States v. Butler, a similar case, a few years earlier. The following excerpt from the Butler opinion contains a rare, FDR-era reference to the 10th Amendment.
“From the accepted doctrine that the United States is a government of delegated powers, it follows that those not expressly granted, or reasonably to be implied from such as are conferred, are reserved to the states or to the people. To forestall any suggestion to the contrary, the Tenth Amendment was adopted. 18 The same proposition, otherwise stated, is that powers not granted are prohibited. None to regulate agricultural production is given, and therefore legislation by Congress for that purpose is forbidden.” –United States v. Butler, 1936.
One disturbing difference between Wickard v. Filburn and United States v. Butler is that by the time that Wickard was decided, state sovereignty-ignoring FDR had managed to nominate eight justices who were evidently inclined to think like he did about state sovereignty.
And in stark contrast to the reference to the 10th A. in the Butler opinion, justices seem to have ignored the 10th A. altogether by the time that they took on cases like Wickard, cases which tested Congress’s constitutional limits.
In fact, Wickard contains the following paragraph where the justices seem to have treated the constitutionally enumerated principle of state sovereignty as if it were merely gossip.
“In discussion and decision, the point of reference, instead of being what was “necessary and proper” to the exercise by Congress of its granted power, was often some concept of sovereignty thought to be implicit in the status of statehood.” –Justice Jackson(?), Wickard v. Filburn, 1942.
Note that there is no reference to Butler in Wickard, corrections welcome. So by the time that Wickard was decided FDR’s puppet justices had essentially “repealed” the 10th A. by simply ignoring that amendment in relevant case opinions, IMO.
Also, despite the misguided idea that a USSC decision cannot be overturned, consider that both the 11th and 16th Amendments were ratified in order to “overturn” unpopular USSC case decisions. What’s interesting about these amendments is that they were proposed by Congress, not by the states.
The bottom line is that I question why the states have sat on their hands with respect to not using their Article V powers to “overturn” USSC case decisions where justices perverted the Founder’s intention for the commerce clause to allow Congress to usurp state powers. This is why I’m convinced that Constitution-impaired voters have been electing federal and state lawmakers who are as clueless about state sovereignty as the voters are.
The only way for the States to Amend the constitution with out having congress propose the amendment (conflict of interest if congress happens to like the new found powers) is to call a constitutional convention. In a constitutional convention the States have absolutely no control over what the delegates come up with, so like in the original constitutional convention in 1787 which was merely to amended the Articles, they could instead write an entirely new Constitution.
Although the States don't necessary have to accept that constitution. Like in the original 1787 case if enough of them do then the rest are kind of in between a rock and a hard place, either accept it or get left out. Unless we have a very firm grasp upon what the vast majority of our sister States whom we do not wish to part with will do, a constitutional convention as previously demonstrated represents considerable risk.
Getting 2/3rd of the states to agree that this risk is worth it to overturn a signal court ruling, on top of getting 3/4th to agree on how to overturn that ruling is a challenge in the extreme.
Of course in my opinion at this point we really don’t have anything left in terms of practical constitutional protections to loses as the federal government has currently “decided to interpret” OUR constitution of powers, which is to say with no meaningful limits on their own powers.
But still that is the opinion of 1 man in 1 State, not yet the majority of men in 2/3rd of the States.
All of this being said we have as recently as the 1960’s come within 1 or 2 state short a Constitutional Convention over a few court rulings one of which was the one which striped out states of their meaningful senates(regional representation). So threshold of resistant to this option is not so high you might think.
In general If you accept that the U.S. Supreme court has the unilateral right to define the meaning of the United States Constitution, then it’s a lot easier for them to “rewrite” the constitution (as it requires only the consent of 5 federal employees in black robes)., then it is for we the people to fix it.(as it requires 3/4ths of the States to agree on how to fix it in addition to the need to fix it).
Much less 2/3rd of the states agreeing that the matter is significantly bad enough to warrant the extraordinary risks involved in a Constitutional convention, assuming congress like the new powers given to them by the court and won’t vote to proposes an amendment. (A Fatal flaw seeing as it took so many to consent to giving up only the limited power of the constitution in the first place, that it should take only so few to take even more and so few to prevent the rest of us from taking the power back.)
So to be frank there is either a fatal flaw in the Federal Constitution as to grant the federal court this power unilaterally rewrite the U.S. Constitution, or the court does not in fact have that power as was presumed to be the case prior to the “civil war”. This is why we argue for nullification and interposition rather then constitutional amendments, as nullification and interposition only requires 1 state to enact to protect its people’s rights and enforce the U.S. Constitution.
The word 'commerce' does not necessarily mean business as the thing responsible for generating your income but the movement of goods from one location to another or trade. The right to regulate commerce between the states meant the right to regulate trade between these two entities or control the movement of goods across state borders.
The federalist papers states that they feared states might place further trade restrictions so they gave the federal government the power to do what states can do so they can strike down the trade barriers that states might put up.
I forgot to mention the following. In contrast to the USSC’s finding that Congress can regulate those aspects of intrastate commerce which “substantially” affected interstate commerce, Jefferson had noted that the states have exclusive control over intrastate commerce.
“For the power given to Congress by the Constitution does not extend to the internal regulation of the commerce of a State, (that is to say of the commerce between citizen and citizen,) which remain exclusively with its own legislature; …” Thomas Jefferson, Jefferson’s Opinion on the Constitutionality of a National Bank : 1791. http://avalon.law.yale.edu/18th_century/bank-tj.asp
The bottom line is that FDR’s puppet justices opened the door for Congress to do the following. Corrupt Congress can now usurp state powers since they can politically bypass the Article V power of the states to ratify amendments to the Constitution which delegate powers to Congress.
And Congress gets away with this because, as I have ranted elsewhere, citizens are no longer teaching the Constitution and its history to their children.
Yes but I think people don't realize that the right to regulate commerce is not the right to control a business but to control the movement of goods and services hence the word 'commerce'. States can regulate commerce within its own borders and even regulate goods crossing its border but by giving that power to the federal government the fed can strike down any trade barrier a state can put up such as preventing people from buying insurance in another state.
Its regulating the movement of goods (or trade) not regulating the internal workings of a business.
Good point about state imposed trade barriers!
And one of the first things that came to mind is voter apathy. I’m afraid that I don’t have much sympathy for “voters” who don’t vote and wind up as slaves to their state governments with respect to things like state-limited trade with other states.
This also brings to mind the following. I think that voters need to demand state laws which permit voters to recall state lawmakers (and judges) when lawmakers don’t behave. For example, when a state lawmaker takes a bribe from an in-state company to make laws which restrict trade with competing companies outside the state. The people need to be able to boot such lawmakers.
I guess that I’m emphasizing that I’d rather see a state’s voters resolve intrastate commerce problems instead of allowing the federal government to stick it’s big nose into such problems.
They are using the perversion of the Commerce Clause to nullify the Tenth Amendment because the Amendment only pertains to powers not granted. Since the Commerce Clause is a granted power, the feds have asserted that the Amendment cannot be invoked to prevent them from exercising their Commerce Clause power.
"To regulate Commerce with foreign Nations, and among the several States, and with Indian Tribes."
It's important to keep in mind that the US Constitution constantly, consistently and carefully refers to three, distinct entities:
1) US Government
2) States
3) People
Because the document was carefully drafted by intelligent people, you will interpret it incorrectly if you fail to recognize that nearly every word was carefully chosen for a particular reason. In other words, if you see the word "STATES" you can't read it to mean "people" or vice versa.
In this case, the so-called 'Interstate Commerce Clause' should be read VERY carefully in order to determine its meaning.
In sum, this section of the Constitution gives Congress the power to "regulate" "commerce" "among" the "several" "States." (We could write an article on EACH of these words.)
While all of these words must be carefully considered before one can reach a final conclusion, it's sufficient for this comment to simply note that the word "interstate" appears nowhere in the text and the word "people" appears nowhere in the text.
Keeping in mind that people are not States, this clause says that Congress can regulate commerce among the STATES – NOT the people. Restated: IF 2 or more STATES engage in Commerce, Congress can regulate it. That's it. This is FAR different from its current application and its why it's so darn frustrating to watch what passes for 'Constitutional Law' as developed by corrupt or stupid lawyers and judges.
Example #1: The States of Oregon, Idaho, Nevada and California make some power sharing agreement that qualifies as 'commerce.' Congress can "regulate" it.
Example #2: Bob, an Oregonian, sells a gun to Tom, a Californian. Congress has no power to be involved at all.
The really tricky part was when this clause was casually referred to as the 'interstate commerce clause' by legal "scholars." This misstatement of the clause has taken root and allows intellectually dishonest (or uneducated) people to claim that all trade that occurs between entities from different states can be regulated. That is simply NOT what the clause says. (Of course, Wickard v. Filburn just makes a complete mockery of the Constitution by asserting that ANYTHING can be regulated because EVERYTHING affects "interstate commerce" in some way – even if the transaction occurs COMPLETELY within the boundaries of a state or even if there is no transaction at all !!! It's simply stunning…)
As always, keeping in mind that the Constitution is an attempt to LIMIT government power, the clause allows Congress to regulate commerce between or among the STATES and that's all. Commerce (whatever that term means is not the subject of this post) between or among people residing in different states is not covered.
Since Congress has only the powers given to it by the Constitution, it has no power to regulate commerce among the people of the various states.
It's simply stunning to see the Constitution turned on its head time and time again. The drafters were so careful to make sure the power was contained and they predicted most of the crap that has occurred by power-hungry government officials over 200 years ago. Their words are clear and the history surrounding the Constitution is well known yet dishonest or stupid people continue to screw it up.
As with most issues that come up in interpreting the Constitution, it's pretty simple to resolve if you can read. It's only complicated when you try to make the document say something it doesn't actually say. That's what lawyers do. Some people call it 'looking for loopholes.' In thinking of lawyers, a different kind of HOLE comes to my mind!
Beautifully written! I’d like to quote this comment in it’s entirety in an article I’m writing. Feel free to send me an email at samandw at gmail dot com if you want to me to cite you. Thanks!