Commerce Clause Started As Guarantee Against Interstate Tariffs

Wes Riddle’s Horse Sense #489

Reclaiming the Constitution (Part 3)

Ted Cruz and Mario Loyola are distinguished scholars who make the argument that constraints on federal power have all but vanished from out of the Constitution. Notwithstanding, the battle against unconstrained federal supremacy continues in the federal courts, and there have even been a few victories and precious groundwork lain for the resurgence of an “originalist” approach to the Constitution, as well as a restoration of the Republic in which the federal government has limited powers.

Perhaps the most important power granted to Congress (though the Framers did not intend this to be the case) has turned out to be the power “To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes.” As has been widely noted, the principal motivation for granting this power to the federal government was the concern that individual States might erect tariff barriers, and thereby discriminate against interstate commerce. During the 19th century, the Commerce Clause was invoked chiefly to overturn state laws that discriminated against interstate commerce. But as late as the early 20th century, the Supreme Court was unwilling to allow this power to reach commercial activity that was purely intrastate.

Starting around 1914, however, the Supreme Court began to embrace an ever-widening interpretation of the Commerce Clause. In the Shreveport Rate cases, the Court articulated a novel basis for intruding on purely intrastate commerce: Where interstate and intrastate commerce were so mingled that regulation of interstate commerce required incidental regulation of intrastate commerce, the activity fell within the commerce power, because of their “close and substantial relation.” As it happened, the victim of this first expansion of federal commerce power was Texas: the Court had ruled that the federal government could regulate the fees charged by a railway between Dallas and Marshall, Texas. The law protected those purely intrastate carriers who faced penalties for disobeying the regulations of the Texas Railroad Commission, in order to comply with federal mandates.

In the 1935 case of Schechter Poultry v. U.S., the Court once again asserted its role as a powerful guardian of constitutional constraints, striking down federal regulation of labor conditions in a purely intrastate business because the activity in question bore only an “indirect” relation to interstate commerce. The Court reasoned that otherwise “there would be virtually no limit to the federal power and for all practical purposes we should have a completely centralized government.”

The Court was no doubt correct about the looming danger of unlimited federal power and “a completely centralized government,” but the political winds were blowing against it. FDR won a landslide reelection in 1936 and in an address to Congress in early 1937 threatened to pack the Supreme Court with additional justices, implicitly warning that if the Court did not acquiesce in his New Deal legislation, he and the Congress would break its power. The Supreme Court reacted that very year, in the case of NLRB v. Jones & Laughlin Steel Corp., by casting aside the categories of direct and indirect effects, and holding instead that Congress could regulate activities that “have such a close and substantial relation to interstate commerce that their control is essential or appropriate to protect that commerce from burdens and obstructions” in state law.

With that, the Court opened the door to all but eliminating the Constitution’s constraints on federal power exercised under the Commerce Clause. The stage was now set for the 1942 decision of Wickard v. Filburn, in which the Supreme Court held that a farmer’s private cultivation of wheat for purely personal use on his own farm could nevertheless be regulated pursuant to the Commerce Clause, because any activity which, in the aggregate across the Nation, could have a substantial effect on interstate commerce, was properly within the power to regulate commerce “among the several States.” If this purely personal activity affected interstate commerce, then every activity falls within the power of the federal government. Wickard expanded the Commerce Clause to its outermost limits—so much so, indeed, that it arguably made the other enumerated powers of the Article I, Section 8 superfluous.

If the Framers had intended to grant the federal government a power to regulate commerce as expansive as that defined in Wickard, there was no need to enumerate so many other powers in addition to the Commerce Clause. Why specifically authorize Congress to create a Post Office (Art. I, Section 8, cl. 7); or regulate bankruptcies (Art. I, Section 8, cl. 4); or protect patents and copyrights (Art. I, Section 8, cl. 8)—if anything that in the national aggregate which might have an effect on commerce (as all those assuredly do) could be regulated already under the Commerce Clause?

Wesley Allen Riddle is a retired military officer with degrees and honors from West Point and Oxford. Widely published in the academic and opinion press, he ran for U.S. Congress (TX-District 31) in the 2004 Republican Primary and is currently Chairman of the Central Texas Tea Party. Article condensed from an essay by Ted Cruz and Mario Loyola (Texas Public Policy Foundation, Nov 2010). Email: Wes@WesRiddle.com.