The Liberty Amendments: Restoring the American Republic (16 page)

Much stress is put upon the evils which come from the struggle between employers and employees over the matter of wages, working conditions, the right of collective bargaining, etc., and the resulting strikes, curtailment and irregularity of production and effects on prices; and it is insisted that interstate commerce is greatly affected thereby. But, in addition to what has just been said, the conclusive answer is that the evils are all local evils over which the federal government has no legislative control.
²⁶

President Franklin Roosevelt struck back. He threatened to pack the Supreme Court and did, in fact, begin to change its
makeup by replacing retiring justices with lawyers who shared his contempt for the constitution’s enumeration of limited federal powers. It was not long before the Court abruptly reversed course.

It began with the 1937 decision in
Jones v. Laughlin Steel Corp.
, where the Court ruled that intrastate activities that “have a close and substantial relation to interstate commerce [such] that their control is essential or appropriate to protect that commerce from burdens and obstructions” are within Congress’s power to regulate.
²⁷

The legal stage was now set for a radical departure from the Constitution’s Commerce Clause text and the Framers’ intent.

The most infamous of the Court’s New Deal decisions in this regard came in 1942 with its ruling in
Wickard v. Filburn.
In this case, the Court abandoned any semblance of jurisprudential integrity and joined with the rest of the federal government in unleashing what is today an endless array of federal interventions in private economic activity.
²⁸

•  •  •

The
Wickard
case involved a dairy farm in Ohio owned by Roscoe Filburn. He used a portion of his land to grow wheat. Every year the wheat he produced was used in four ways: some was sold, some was fed to his livestock, some was used to make flour, and the rest was used for seeding for the following year. The use or sale of his wheat all occurred exclusively within the state of Ohio. The Agricultural Adjustment Act of 1938, however, set quotas on the amount of wheat he was allowed to produce. When Filburn exceeded the quota, he was fined by the federal government.

How could the federal government regulate wheat that was grown, used, and sold wholly within the borders of Ohio? The Supreme Court wrote, in part:

It can hardly be denied that a factor of such volume and variability as home-consumed wheat would have a substantial influence on price and market conditions. This may arise because being in marketable condition such wheat overhangs the market and if induced by rising prices tends to flow into the market and check price increases. But if we assume that it is never marketed, it supplied a need of the man who grew it which would otherwise be reflected by purchases in the open market. Home-grown wheat in this sense competes with wheat in commerce. The stimulation of commerce is a use of the regulatory function quite as definitely as prohibitions or restrictions on them.
²⁹

If there was any doubt at all where the Court was taking the nation, it added that “even if appellee’s activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce. . . . ”
³⁰
Hence, noncommercial, local activity could be regulated by the federal government if it was said to have a substantial effect on commerce, even when it did not. Consequently, virtually any economic activity could be said to affect interstate commerce.

For the last seventy years, since the
Wickard
decision, Congress has passed laws and federal departments and agencies have issued regulations affecting all manner of economic activity. Rather than promoting private commerce and trade without barriers between and among the states, which was the indisputable rationale for the Commerce Clause, the federal government now intervenes in private economic activity, and stomps on state sovereignty, at every turn.

For example, in 1968, in
Maryland v. Wirtz
, the Supreme
Court ruled that the federal Fair Labor Standards Act applied to state-run hospitals, nursing care facilities, and schools because “labor conditions in schools and hospitals can affect commerce.”
³¹
It added that if Congress had a “rational basis” for enacting the law, the Court would uphold it.
³²

In 1971, in
Perez v. United States
, the Court upheld provisions of the Consumer Credit Protection Act, making loan-sharking a federal offense despite the fact that these activities occurred strictly at the local level. The Court ruled, “Extortionate credit transactions, though purely intrastate, may, in the judgment of Congress affect interstate commerce.”
³³
In his lone dissent, Associate Justice Potter Stewart argued that

under the statue before us, a man can be convicted without any proof of interstate movement, of the use of the facilities of interstate commerce, or of facts showing that his conduct affected interstate commerce. I think the Framers of the Constitution never intended that the National Government might define as a crime and prosecute wholly local activity through the enactment of federal criminal laws.
³⁴

With rare exceptions, the Court has generally held that any federal law could affect commerce and would be constitutionally sustained, if Congress provides a “rational basis” for a given law’s impact on interstate commerce. Of course, most laws are based on some rational basis. Otherwise, they would be irrational. That is a very low bar indeed.

In fact, there have been only two clear instances since
Wickard
where the Supreme Court has actually rejected Congress’s attempt to further expand its power through the Commerce Clause.
In 1995, in
U.S. v. Lopez
, Congress attempted to make the possession of a firearm near a school a federal crime with the Gun-Free Schools Zone Act of 1990. Proponents of the measure argued, among other things, that the inherent dangers of guns would increase insurance costs or deter travel, or that guns near schools would have a detrimental effect on education, a necessary foundation of commercial and economic activity. The Court found these arguments beyond the reach of the Commerce Clause. As Chief Justice William Rehnquist wrote, the possession of a firearm near a school did not meet even the Court’s extremely broad view of commerce, which he summarized as follows:

First, Congress may regulate the use of the channels of interstate commerce. . . . Second, Congress is empowered to regulate and protect the instrumentalities of interstate commerce, or persons or things in interstate commerce, even though the threat may come only from intrastate activities. . . . Finally, Congress’ commerce authority includes the power to regulate those activities having a substantial relation to interstate commerce, . . . i.e., those activities that substantially affect interstate commerce. . . .
³⁵

Notably, even when drawing a line against Congress’s power grab, Rehnquist embraced the Court’s earlier distortion of the Commerce Clause in
Wickard
.

Moreover, consider Associate Justice Stephen Breyer’s outlook in his dissent.

Congress obviously could have thought that guns and learning are mutually exclusive. Congress could therefore have
found a substantial educational problem—teachers unable to teach, students unable to learn—and concluded that guns near schools contribute substantially to the size and scope of that problem. Having found that guns in schools significantly undermine the quality of education in our Nation’s classrooms, Congress could also have found, given the effect of education upon interstate and foreign commerce, that gun-related violence in and around schools is a commercial, as well as human, problem. Education, although far more than a matter of economics, has long been inextricably intertwined with the Nation’s economy.
³⁶

For Breyer, there simply are no real limits on Congress’s power to intervene in private economic behavior. Of course, state and local governments have the authority to outlaw gun possession near schools and often do. But Breyer was not alone. Associate Justice David Souter considered the Court’s pre-1937 efforts to comply with the Commerce Clause’s text and history “the old judicial pretension [that was] discredited and abandoned,”
³⁷
from which “the Court extricated itself almost 60 years ago” by discarding its “untenable jurisprudence.”
³⁸
Associate Justice Anthony Kennedy, although concurring with the Court’s holding, wrote that “
stare decisis
[the Court’s precedent] . . . counsel[s] us not to call into question the essential principles now in place. . . . ”
³⁹
It “forecloses us from reverting to an understanding of commerce that would serve only an 18th-century economy.”
⁴⁰

Consequently, Souter rejected flatly what he knew to be the unequivocal intention of the Framers when fashioning the Commerce Clause, and Kennedy determined that the only judicial precedents worthy of faithful adherence were Commerce Clause
opinions the Court began issuing in 1937. As for economic growth necessitating the rewrite of the Commerce Clause, Raoul Berger noted that these justices “too easily assume that economic growth necessarily is accompanied by automatic expansion of the Constitution to facilitate it. Economic expansion, however, cannot alter the scope of the ‘fixed’ Constitution, particularly when the alteration constitutes a federal takeover of functions that the states were assured were ‘inviolable.’ ”
⁴¹
In fact, the industrial revolution in the United States predated the New Deal, turning the nation into the most powerful economic force on earth and creating a vast middle class.

The second case,
United States v. Morrison
, came in 2000 and involved the Violence Against Women Act of 1994, which created a federal cause of action for victims of gender-based violence. If upheld, Congress would have assumed police powers belonging to the states and localities, and the authority to federalize virtually any criminal activity. However, the Court found the link between the statute and interstate commerce too ephemeral. Rehnquist wrote:

We accordingly reject that argument that Congress may regulate noneconomic, violent criminal conduct based solely on that conduct’s aggregate effect on interstate commerce. The Constitution requires a distinction between what is truly national and what is truly local.
⁴²

In his dissent, Breyer noted correctly that the Court had not rejected its post-1937 precedent but he complained that it had not expanded that precedent far enough.

The Court’s rules, even if broadly interpreted, are underinclusive. The local pickpocket is no less a traditional subject of state regulation than is the local gender-motivated assault. Regardless, the Court reaffirms, as it should, Congress’ well-established and frequently exercised power to enact laws that satisfy a commerce-related jurisdictional prerequisite—for example, that some item relevant to the federally regulated activity has at some time crossed a state line. . . . And in a world where most everyday products or their component parts cross interstate boundaries, Congress will frequently find it possible to redraft a statute using language that ties the regulation to the interstate movement of some relevant object, thereby regulating local criminal activity or, for that matter, family affairs.
⁴³

The ruling did not slow Congress’s march for ever more authority to control economic activity and the states. And, as Breyer suggested, Congress would move to regulate family matters. Most recently and notoriously, in its Obamacare decision, four of the nine Supreme Court justices were prepared to use the Commerce Clause to uphold a provision in the law, the so-called individual mandate, penalizing individuals who refuse to engage in an economic transaction against their wishes and/or interests—that is, the purchase of a private health-care policy. As written, Obamacare imposes a “penalty” on those uninsured individuals who do not purchase health insurance. These four justices would have upheld the law on Commerce Clause grounds, insisting that a decision by an individual not to take any action affects interstate commerce. In a four-justice concurring opinion, Associate Justice
Ruth Bader Ginsburg wrote, “[T]he decision to forgo insurance is hardly inconsequential or equivalent to ‘doing nothing,’ . . . it is, instead, an economic decision Congress has the authority to address under the Commerce Clause.”
⁴⁴
It would seem the nation is one Supreme Court justice away from the federal government dictating all manner of individual behavior.
⁴⁵

Lest we forget, the Supreme Court is ruling on laws passed by Congress and regulations issued by the executive branch. Since 1937, all three branches of the federal government have colluded openly in dismantling the Constitution’s structure. The governing masterminds, elected and appointed, have bulldozed through the enumeration of powers, separation of powers, and the states’ sovereignty to regulate and control private economic activity—and more. The rewriting of the Constitution without benefit of constitutional amendment is behavior that is, by definition, unconstitutional.

•  •  •

The proposed amendment returns the power to regulate commerce and trade to one of defined parameters. It not only encourages commerce and trade between and among the states but, as the Framers understood and intended, also preserves the civil society and promotes individual liberty. This is a hugely significant matter. As Dr. Milton Friedman explained: “Freedom in economic arrangements is itself a component of freedom broadly understood, so economic freedom is an end in itself. . . . [E]conomic freedom is also an indispensable means toward the achievement of political freedom.”
⁴⁶