The defendants (now appellants) argue that their conduct is not sufficiently related to interstate commerce, and is too local in character, to justify Congress’ exercise of its interstate commerce authority. Their contention in this regard is not about whether the promotion of cockfighting may be banned, but rather whether such conduct may be banned by Congress, which can only enact statutes that further its constitutionally enumerated powers. (Such conduct is largely prohibited, albeit with a lesser criminal sanction, by South Carolina law.)  Their contention, moreover, appears not to be that the Animal Welfare Act as a whole is unconstitutional, but only that its application to their particular conduct exceeds Congress’s interstate commerce power.

The appellants’ arguments have a familiar ring to them. To be sure, such reasoning held meaningful sway with the Supreme Court until 1937, when a majority of the Court, after a game of chicken with FDR, relented and began recognizing greater congressional power to legislate under the Interstate Commerce Clause. Among other things, Congress could regulate activities that, in the national aggregate, substantially affected interstate commerce, regardless of whether a given activity was interstate or intrastate and regardless of Congress’ actual motives or purposes. Under this approach, not only were various New Deal statutes upheld, but so were subsequent statutes in the 1960s and 1970s concerning such matters as civil rights and environmental protection.

Over the past two decades, however, the Court has again shown a willingness to henpeck Congress regarding its commerce-based legislation. The turning point occurred in a 1995 case, United States v. Lopez, in which the Court by a 5-4 vote struck down a federal statute criminalizing gun possession within 1000 feet of a school. Five years later, in United States v. Morrison, the Court again by a 5-4 vote struck down a federal statute creating a cause of action, and authorizing civil liability, for gender-motivated violence.

Both of these statutes, said the Court, governed conduct that was not commercial in nature, and neither statute was part of a larger federal scheme of commercial regulation. Nor did either law require proof that a defendant’s conduct actually bore a relationship to interstate commerce. The Court also noted that the statutes touched on one or more areas, such as criminal law, traditionally within the legal domain of the states. Given these factors, the Court in both cases concluded that Congress had exceeded its interstate commerce authority.

In light of these recent decisions, the defendants’ arguments can hardly be characterized as frivolous, much less bird-brained. Like all litigants, however, they should be wary of counting their legal chickens before they’ve hatched. As it turns out, most statutes challenged since Lopez have not suffered the same fate as those at issue in Lopez and Morrison. Lower courts have generally been reluctant to apply the Lopez factors too strictly, and the Supreme Court itself—with the exception of Morrison—has only made suggestions of potential unconstitutionality with regard to other statutes, otherwise upholding every law it has reviewed under the Interstate Commerce Clause. In the 2005 case of Gonzales v. Raich, for example, the Court (by a different majority) upheld an application of the federal Controlled Substances Act to the intrastate cultivation and possession of marijuana used for medical purposes pursuant to a state law. Congress, meanwhile, seems to have taken at least somewhat seriously the admonitions of Lopez and Morrison and appears less likely today to enact statutes possessing the flaws of the statutes struck down in those cases.

The relevant provision of the Animal Welfare Act, 7 U.S.C. § 2156, covers a range of conduct related to “an animal fighting venture.” (This provision, among others, resulted in NFL quarterback Michael Vick’s 2007 federal conviction for financing and participating in dogfighting operations, which partly took place in South Carolina.)  Taken together, § 2156’s subsections make it criminal “to knowingly sponsor or exhibit an animal in an animal fighting venture,” § 2156(a)(1); “to knowingly sell, buy, possess, train, transport, deliver, or receive any animal for purposes of having the animal participate in an animal fighting venture,” § 2156(b); “to knowingly use the mail service of the United States Postal Service or any instrumentality of interstate commerce for commercial speech for purposes of advertising an animal, or an instrument described in subsection (e), for use in an animal fighting venture, promoting or in any other manner furthering an animal fighting venture,” § 2156(c); or “to knowingly sell, buy, transport, or deliver in interstate or foreign commerce a knife, a gaff, or any other sharp instrument attached, or designed or intended to be attached, to the leg of a bird for use in an animal fighting venture,” § 2156(e). A violation of any of these subsections can lead to a fine, to imprisonment up to five years, or to both (see § 2156(j) and 18 U.S.C. § 49). The term “animal fighting venture,” though expressly excluding hunting, is defined as “any event, in or affecting interstate or foreign commerce, that involves a fight conducted or to be conducted between at least 2 animals for purposes of sport, wagering, or entertainment,” § 2156(g)(1).

Applying the Lopez and Morrison factors to § 2156, it is apparent that some of its prohibitions are clearly constitutional. Those that target inherently commercial activities such as buying and selling, and especially those that also expressly link the activity to interstate commerce or to a channel or instrumentality of interstate commerce, seem well within the judicially defined scope of Congress commerce power. Conversely, those that target activities that are not inherently commercial—for example, exhibiting or possessing—potentially stand on a weaker footing, but they do explicitly require proof that the animal or object be knowingly destined for use in an animal fighting venture that (by statutory definition) is “in or affecting interstate or foreign commerce . . . .” To be sure, the federal prosecution introduced evidence of out-of-staters that traveled to the event; of out-of-state items—including feed and a host of resources used for the fighting—that were shipped to individuals at, or seized from the scene of, the event giving rise to the convictions; and of the deposit of event proceeds into a bank account, from which funds were drawn by checks that were then processed out-of-state.

In past Supreme Court cases, most notably Katzenbach v. McClung from 1964, it has been held that Congress’ commerce power can reach a business that receives from out-of-state a portion of the goods that it then sells to customers, even if the customers are generally from in-state. Moreover, the size or amount of the actual portion of goods (or its monetary value) is generally not relevant insofar as Congress may aggregate all like activities when tallying or gauging the overall effect on interstate commerce. Nor does it matter whether or not one can plausibly characterize an activity as local rather than national or interstate. As the Court remarked in the 1942 decision of Wickard v. Filburn, “even if . . . [the] 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 . . . .”

These are older, pre-Lopez precedents, it is true, but neither Lopez nor Morrison expressly overruled any prior decisions, and the Raich decision approvingly invoked both McClung and Wickard, drawing particular support from the latter. Indeed, in response to the challengers’ heavy reliance on the Court’s more recent cases of Lopez and Morrison, the Raich majority stated that “[i]n their myopic focus, they overlook the larger context of modern-era Commerce Clause jurisprudence preserved by those cases” and that “even in the narrow prism of [their] creation, they read those cases far too broadly.”

This could very well be the same response that the Court of Appeals, without much brooding over precedent, will give to most if not all of the appellants in their challenges to the Animal Welfare Act. It may be that the appeals court will find that one or even a few of them have reasonable arguments against the application of the statute, though probably not arguments of sufficient strength to prevail. Insofar as they all contributed to or operated a commercial operation—the interstate effects of which, if aggregated with similar operations nationwide, can plausibly be deemed substantial—the likelihood of an affirmance with regard to their convictions under the Animal Welfare Act would seem to be high. Should such an affirmance occur, one might venture to say that, in the end, the chickens will have indeed come home to roost.

Details like this provide an inside glimpse of the Court.  Early in his account, Stevens describes how the prohibition against playing basketball in the gym directly above the courtroom occurred during Vinson’s tenure: Byron White, one of Vinson’s first clerks and a former All-American, was practicing layups during oral argument.  Stevens’ anecdotes are always respectful of their subjects and strike one as rather tame, at least until one realizes that civility, the ability to “disagree without being disagreeable,” is of the utmost importance to him.  Stevens sat beside Antonin Scalia for much of his time on the Court and was the “beneficiary of [Scalia’s] wonderfully spontaneous sense of humor.”  The year Scalia was appointed, they heard two cases involving police questioning of rather unsophisticated suspects.  (Stevens does not identify the cases by name, another instance of his tact, but they are readily identifiable from his brief description of the facts as Colorado v. Spring and Connecticut v. Barrett, both decided in 1987).  Scalia apparently leaned over and whispered to Stevens that it must be “dumb defendant day.”  Now, anyone who has read a Scalia opinion knows that this cannot be the apogee of his wit and can be fairly certain that, in their twenty-four years on the bench together, he made sharper comments in the course of their duties.

One gets the sense that Stevens is reluctant to write anything that might reflect poorly on the Court or its Justices.  And it is perfectly understandable that he would be unwilling to besmirch the institution with idle gossip.  The Court is both a vital force and symbol of American democracy and, in the words of his dissent in Texas v. Johnson (1989), where the majority held that burning an American flag at a demonstration was protected by the First Amendment, it is “worthy of protection from unnecessary desecration.”

Nevertheless, Stevens does not shy away from criticizing his colleagues and even President Reagan when their decisions diverge from his closely held principles.  Though he found common ground with Chief Justice Rehnquist on issues involving separation of powers, Stevens was sharply critical of Rehnquist’s stance on state sovereign immunity, particularly in Seminole Tribe of Florida v. Florida (1996).  “Like the gold stripes on his robe, Chief Justice Rehnquist’s writing about sovereignty was ostentatious and more reflective of the ancient British monarchy than our modern republic.”  Invariably, however, Stevens’ criticisms are based on what he considers to be flawed reasoning and not personal animus.  His disapproval of Rehnquist’s decision to adorn his robe with gold stripes does not detract from his admiration for Rehnquist’s other fine qualities: his impartiality in both private conference and open court and his efficient administration of the Court’s business.

Stevens’ evaluation of the current Chief Justice, John Roberts, is very favorable.  He describes him as “a better presiding officer than both of his immediate predecessors” as well as a more skilled representative of the Court in non-judicial settings.  He is particularly appreciative of Roberts’ concurrence in Graham v. Florida (2010) because it represents for him a rejection of the interpretive approach that looks at the “original intent” of the Framers in determining the constitutionality of a given case.  In Graham, Roberts agreed with the majority that imposing a life sentence on a juvenile defendant for a non-homicide offense violated the Eighth Amendment but rejected a categorical bar to such a sentence on the grounds that courts should weigh factors like the offender’s age and criminal conduct on a case-by-case basis.  Roberts recognized a proportionality requirement at variance with Scalia’s dissenting opinion in Harmelin v. Michigan (1991) that would prohibit certain, specific punishments under the Eight Amendment but would not require, in Stevens’ words, “that the punishment fit the crime.”

Stevens’ discussion of Roberts’ opinion in Graham highlights two themes of his own judicial philosophy.  According to Stevens, judges and justices should exercise restraint, and decide only what a case “actually presented” without trying “to craft an all-encompassing rule for the future.”  Kyllo v. United States (2001) (dissenting).  This, of course, stems in part from his understanding of the separation of powers in our system of government.  As he wrote in Kyllo, Congress is the branch that “grapple[s] with. . . emerging issues” and it is counterproductive to “shackle them with prematurely devised constitutional constraints.”

Secondly, Stevens disagrees with an uncompromising insistence on the specific intent of the Framers because it does a disservice to the emerging problems of a changing society.  Which is not to say the principles enshrined in the Constitution are readily susceptible to modification; if they were they would not be principles.  Rather, it is that the strength of the principles lies in their flexibility and not in a code-like rigidity.  Stevens quotes Justice McKenna in Weems v. United States (1910), “[A] principle, to be vital, must be capable of wider application than the mischief which gave it birth.”

These two aspects of Stevens’ jurisprudence help explain what comes across in his memoir: a reticence that displays itself in distaste for superfluous gossip on the one hand, and a generosity of spirit capable of disagreement without rancor on the other.  Towards the end of Five Chiefs, Stevens writes that he has “no memory of any member of the Court raising his or her voice.”  Whether this is strictly true, and as far as it is his memory there is no reason to doubt that it is, it sheds light on how Stevens envisioned the work of the Court as a civil pursuit for justice.

But while important, severability is in many ways perplexing and underexplored. No one has come up with a fully satisfying test for determining when severance is appropriate. And no one, as far as I can tell, has critically examined choice-of-law rules pertaining to the doctrine’s application.

In an effort to resolve some of these problems, I’ve written an article that examines the U.S. Supreme Court’s approach to the choice-of-law component of severability doctrine. I contend that, in two recent decisions, the Court quietly established the severability of state statutes in federal court to be a matter of general federal common law, and that this doctrine is not only inexplicably inconsistent with dozens of cases decided since Erie Railroad Co. v. Tompkins, but also displaces a large body of diverse state law without constitutional authorization or any supporting federal interest. I argue that the new doctrine thus challenges standard accounts of the limits of federal common law and calls into question the contemporary vitality of Erie’s principle of judicial federalism. I then close by proposing an alternative that would harmonize the precedent, help to revitalize Erie, and honor the bounds of Article III judicial power.

A draft of the article is available here. Please let me know if you have any comments or criticisms; I’d appreciate any feedback, either below or at ryan.scoville@marquette.edu.

I have commented on this issue before.   The editorial position of the Milwaukee Journal-Sentinel is misguided.  In particular, in editorializing against the exercise of the recall power, the Journal-Sentinel fails to account for both the specific text of the Wisconsin Constitution and the understanding of the recall power among the founding generation of our country.  The key to understanding the proper scope of the recall power is the basic conception of “the sovereignty of the people.”

As explained by Michael Kammen, emeritus Professor of History at Cornell University, in his 1988 book Sovereignty and Liberty: Constitutional Discourse in American Culture, the period immediately before and after the adoption of the United States Constitution saw a debate among the public concerning what it actually meant for the people of the United States to hold the ultimate sovereignty in our system of government.

On the one hand, some argued that popular sovereignty was largely a myth, and that the sovereign power of the people only manifested itself on the specific dates of regularly scheduled elections.  In between these elections, went this argument, the sovereign power to govern rested solely in the hands of those representatives of the people who had been elected by the voters.

In opposition to this view, many argued that the sovereign power of the people was in fact very real and that this power was exercised on an ongoing basis even during the period in between elections.  As I have explained in this article in the Wake Forest Law Review, conceptions of limited government in America rest on the idea that the people are the ultimate sovereign and that government only possesses the powers that are delegated to it by the people.  The recent growth of the Tea Party movement in the United States is an expression of the resurgence of this basic concept in contemporary political discourse.  Central to this idea of delegated authority is the principle that elected representatives must act in accord with the wishes of the public, and that the failure to do so is in and of itself sufficient grounds for that representative to be recalled before the end of their term in office.

Consider this quote from George Washington, in a letter to his nephew in 1787:

The power under the [federal] Constitution will always be in the People.  It is entrusted for certain defined purposes, and for a certain limited period, to representatives of their own chusing; and whenever it is executed contrary to their Interest, or not agreeable to their wishes, their Servants can, and undoubtedly will be, recalled.

(quoted by Kammen at page 24)

The Wisconsin Constitution clearly reflects and adopts the principle of an active popular sovereignty by creating the unlimited right to recall elected officials.  This is demonstrated by the fact that under Article XIII, Section 12, the power of recall is placed solely in the hands of the public, in the form of a recall election.  Not only does Section 12 explicitly refer to the “right” of recall, this section places the exercise of this removal power in the hands of the people as opposed to in the hands of their elected representatives.  Section 12 is also notable in that it does not limit the grounds of a recall election in any way.

The impeachment power, in contrast, is treated in Article VII, Section 1 of the Wisconsin Constitution.  Removal of elected officials via impeachment is clearly a power delegated to the representatives of the people, with specific powers granted to the Senate (trial) and the Assembly (commencement of proceedings).  Specific procedures must be followed during the impeachment process, in accord with the fact that those officials subject to removal by impeachment are entitled to an official opportunity to defend their conduct.  Most significantly, the impeachment power that is delegated to the people’s representatives is limited to the narrow grounds of “corrupt conduct” or the commission of “crimes and misdemeanors.”  The use of limiting language in Article VII, in terms of both procedure and grounds, and the absence of any similar limitations on the right of recall in Article XIII, clearly express the intent of the drafters of the Wisconsin Constitution to allow for a recall prior to the end of a representative’s term on virtually any grounds so long as a sufficient segment of the public desire that result.

Obviously, the editorial page at the Milwaukee Journal-Sentinel does not like the existence of such an unbounded power in the hands of the people.  As Professor Kammen makes clear, historical efforts to restrict and contain the exercise of popular sovereignty by the people have generally been based on a distrustful view of human nature.  Opponents of popular sovereignty do not trust the general population to make informed or wise choices.  Instead, they would structure the institutions of government in such a way that the ultimate power is placed in the hands of an elite and therefore more trustworthy class.

When it comes to the federal constitution, it appears that the opponents of popular sovereignty won the battle and succeeded in limiting the ability of the general public to influence the direction of public policy in any way other than by casting regularly scheduled electoral votes.  Kammen attributes this result to “a diminished faith in the capacity of ordinary folk” in the years after 1787 (Kammen at p. 29).  The importance of popular sovereignty at a national level fell into a decline in the following two centuries that the Tea Party Movement has only recently attempted to reverse.

However, state constitutions are different from the federal constitution.  In multiple provisions, state constitutions reflect an intent to give the sovereign will of the people a greater role in the determination of public policy at the state level than it enjoys at the federal level.  For example, the existence of provisions providing for state-wide voter initiatives, most commonly identified with California, reflect a desire to provide a means for the people at large to exercise their sovereign will and create laws independently of their elected representatives.  It remains to be seen whether the backers of the Tea Party Movement, so concerned about limiting federal power in order to promote individual freedom, will rouse themselves to defend the idea of popular sovereignty at the state level.

The recall provisions in the Wisconsin Constitution are a right possessed by the people of Wisconsin.  The Wisconsin Constitution intentionally places this right in the hands of the public, and it is intentionally left unbounded.  To interpret this right to be limited solely to conduct which would also constitute grounds for impeachment would be to eviscerate the right.  Such a result would not only be duplicative of the separate impeachment provisions of the Wisconsin Constitution, it would also limit the ability of the voters of Wisconsin to exercise their sovereign power in any form other than by casting a vote every few years in a regularly scheduled election. One likely result of the removal or limitation of the possibility of a recall would be to make elected officials less accountable to the public and to amplify the influence wielded by lobbyists and corporate donors during the interval in between elections.

The text of the Wisconsin Constitution has been under assault over the past year.  The Wisconsin Supreme Court has construed the “open doors” provision of the Constitution, guaranteeing public access to the legislature, in a manner that renders it largely meaningless.  The Office of the Attorney General argued in court filings that the “publication” requirement of the Constitution could be satisfied without following statutory procedures that call for the participation of the Secretary of State.  Today, there is news that the League of Women Voters will file a lawsuit contending that the new Voter ID law contravenes the right to vote contained in the Wisconsin Constitution.  The recall provisions of Article XIII, Section 12, are now in the crosshairs, and are being subjected both to editorial criticism and to legislative “reform” proposals.

Personally, I have faith in human nature.  I believe that the public at large is capable of making wise and informed decisions on public policy.  I also believe in the oft-stated principle that it is the people at large who are the ultimate sovereigns in America.  Popular sovereignty is not a myth.  However, I also know that if we stop believing in popular sovereignty, if we stop behaving as if the principle is real, and if we accept the premise that the people at large cannot be trusted, then we will undoubtedly succeed in transforming today’s right into tomorrow’s myth.

For instance, in the new Seventh Circuit case, United States v. Mandel (No. 09-4116), the defendant planned a hit on his business partner with one of his employees, who turned out to be a confidential informant. A jury convicted Mandel on six counts of violating § 1958(a). In four, the “use of a facility of interstate commerce” was a cell phone conversation with the c.i. (three of which were actually initiated by the c.i.). In the other two, the “use of a facility of interstate commerce” was driving around in a car with the c.i. while the hit was discussed.

In all of these counts, what triggers federal jurisdiction seems only incidental to the offense; it is not the use of a cell phone or a car that made the defendant’s conduct dangerous and his intentions blameworthy. Mandel would merit no less punishment if he had communicated with the c.i. by sign language or smoke signals, or if he had gotten around by roller-skating. It is this lack of a meaningful connection between the jurisdictional element and the wrongfulness of the defendant’s conduct that gives federal prosecution such an arbitrary character in so many cases. But, for better or worse, that is where we are in the modern world of Commerce Clause jurisprudence. (Note, though, the Supreme Court’s efforts to maintain some sort of principled limitations on federal criminal jurisdiction in its interesting decision last term in Fowler v. United States.)

Mandel contested the jurisdictional issues on appeal, but to no avail.

With respect to the cell-phone counts, Mandel’s argument sounded in entrapment, since it was the c.i. who initiated the calls. (Mandel did not challenge his conviction based on the one call he had initiated.) However, the court did not buy Mandel’s assertion that he was not predisposed to use the cell phone:

Whether the defendant is predisposed to commit the charged crime depends on a number of factors, see, e.g., United States v. Orr, 622 F.3d 864, 870 (7th Cir. 2010), cert. denied, 131 S. Ct. 2889 (2011), “the most important of which is ‘whether the defendant evidenced reluctance to engage in criminal activity which was overcome by repeated Government inducement.’” King, 627 F.3d at 650 (quoting United States v. Blassingame, 197 F.3d 271, 281 (7th Cir. 1999)).

. . .

Mandel posits that he would not have discussed the murder scheme on a cell phone but for Dwyer taking the initiative in contacting him on his cell, but the evidence suggests otherwise. First, the cell phone was Mandel’s own phone, and although use of such telephones was rare thirty years ago, it is commonplace today—in both law-abiding and criminal domains. Second, Mandel took Dwyer’s calls (and, as the call underlying Count Three demonstrates, returned them) and readily discussed the scheme to kill Antoniou without any apparent reluctance or hesitation. Third, Mandel was not simply a passive recipient of the calls. The call underlying Count Five is one that Mandel himself placed to someone other than Dwyer in order to determine when Antoniou’s visitation with his son would be ending and Antoniou would be returning to his usual abode, so that an appropriate date for the hit could be determined. Mandel’s self-initiated use of his cell phone in that instance puts the lie to the notion that he would not have used the phone in furtherance of the scheme but for Dwyer’s prompting. Finally, to the extent that Dwyer’s calls to Mandel’s cell phone could be characterized as inducement to use that phone to discuss the scheme, they were hardly the sort of extraordinary inducement that is necessary to show entrapment. (13, 15-16)

Mandel relied on an old Second Circuit case, United States v. Archer, 486 F.2d 670 (2d Cir. 1973), which, in the words of the Seventh Circuit, “presupposes that it is improper for a government agent to initiate some action in interstate commerce for the sole purpose of ginning up federal jurisdiction over an offense, even if, as in Archer, the defendant himself willingly reciprocates the agent’s interstate action.” (17) However, the Seventh Circuit noted the lack of subsequent support, even in the Second Circuit, for this broad proposition. Thus, the court indicated that standard entrapment analysis of predisposition should govern claims that the United States has “manufactured jurisdiction.”

With respect to the driving counts, Mandel argued that purely intrastate use of an automobile should not suffice for federal jurisdiction. Under the terms of the statute, however, what is important is not the defendant’s use of something in interstate commerce, but the defendant’s use of something that counts as a “facility of interstate commerce.” That requirement seems satisfied on a per se basis by the use of an automobile: “Automobiles are designed to move people and goods over distances both long and short, and as such they play a crucial role in interstate commerce.” (23)

So, the statute was satisfied.  But, so interpreted and applied, was the statute constitutional? The Seventh Circuit seemed at least a little sympathetic to Mandel’s arguments on this score:

Mandel’s contrary position, that a private automobile must actually be used in interstate commerce in order for it to come within the scope of the commerce power, is not wholly without support. The Eleventh Circuit, in Garcia v. Vanguard Car Rental USA, Inc., 540 F.3d 1242, 1249-50 (11th Cir. 2008), declined to sustain the Graves Amendment, 49 U.S.C. § 30106, which shields car rental and leasing firms from vicarious liability for injuries to persons or property arising from their customers’ use of the lent vehicles, as a valid regulation of instrumentalities of interstate commerce. The court was concerned that if a car’s status as an instrumentality of interstate commerce were by itself sufficient to support the exercise of the commerce power, there would be no limit to the aspects of automobile use that Congress could regulate. “If cars are always instrumentalities of interstate commerce . . . Congress would have plenary power not only over the commercial rental car market, but over many aspects of automobile use” including “such quintessentially state law matters as traffic rules and licensing drivers.” Id. at 1250. (24-25)

Despite some apparent constitutional concern, the Seventh Circuit rejected Mandel’s argument because it was not made below and the issue was not so clear-cut in his favor as to satisfy the requirements for plain error. Defense counsel, take note: if the issue is properly preserved, the Seventh Circuit seems to have left itself some room to rule in a defendant’s favor in a later case.

Cross posted at Life Sentences Blog.

This state-centric arrangement has come under fire in the last couple of decades, with the federal government staking its ground regulating insurance first around the periphery and then increasingly at the core of the insurance industry.  Some federal statutes make certain practices with certain aspects of an application for or policy of insurance illegal, whether proscribing genetic discrimination, as the Genetic Information Nondiscrimination Act (GINA) does, or limiting the pre-existing condition as the Health Insurance Portability and Accountability Act (HIPAA) did.  Also regulating health insurance at the federal level is the monumental Patient Protection and Affordable Care Act of 2010 (PPACA or “Obamacare” as it is more popularly known).  The PPACA statutorily mandates that some health insurance policies and group health plans eliminate certain provisions altogether, such as lifetime limits on health benefits and the pre-existing condition limitation.  Perhaps even more radically, the PPACA delegates authority to the Department of Health and Human Services to regulate the contents of health insurers’ and plans’ summary of benefits and even the policies themselves.

All the while, a bigger proposal for federalizing insurance laid under the surface.  Something else was being debated amid the political grandstanding accusing conservatives of callously turning a blind eye to the poor’s unmet health care needs and liberals of fashioning monstrous “death panels.”  These debates considered repealing the McCarran-Ferguson Act.  Timothy Noah, Busted Trust, Slate (Oct. 14, 2009), http://www.slate.com/id/2232443/ (last visited Jul. 10, 2011).

Though there would be significant symbolic import to repealing a statute prescribing a policy of federalism, as Professor Kenneth Abraham suggested in Insurance Law & Regulation, favoring state regulation in an era of increasing federal commercial regulation, some commentators posit that McCarran-Ferguson might not have much of an effect on its own, with other theories and defenses that can take up its slack. According to Phillip Areeda’s and Herbert Hovenkamp’s treatise, the antitrust laws might already apply to the insurance industry’s collaborative activity in situations lacking sufficient state regulation or to activities that are sufficiently interstate;  might not create antitrust liability in the first instance; or would be saved by the defense of state action immunity under Parker v. Brown, 317 U.S. 431 (1943).  Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law § 219d (2000).  Nonetheless, Professors Areeda and Hovenkamp also maintain there may be some ways in which McCarran-Ferguson may add something to the overall mix of antitrust liability, such as providing a more expansive defense than does Parker immunity. Id.

Let’s flesh this out a bit, first by examining the first-level statements of each defense’s elements.  The Parker Court exempted from federal antitrust scrutiny acts of government and public officials implementing a state law that requires anticompetitive conduct.  Parker v. Brown, 317 U.S. 341, 352 (1943).  That being said, states may not confer Parker immunity simply by allowing private parties to engage in anticompetitive conduct.  Cantor v. Detroit Edison Co., 428 U.S. 579, 592-93 (1976).  ”It is not enough that . . . anticompetitive conduct is ‘prompted’ by state action; rather, anticompetitive activities must be compelled by direction of the state acting as a sovereign.”  Goldfarb v. Virginia State Bar, 421 U.S. 773, 791 (1975).  The Midcal Aluminum case gave further definition to Parker immunity, stating that “the challenged restraint must be ‘one clearly articulated and affirmatively expressed as state policy’ [and] the policy must be “actively supervised” by the State itself.”  California Liquor Dealers v. Midcal Aluminum, Inc., 445 U.S. 97, 105 (1980) (citing City of Lafayette v. Louisiana Power & Light Co., 435 U.S. 389, 410 (1978) (Brennan, J.)). 

By contrast, the relationship between state insurance regulation and acquiring McCarran-Ferguson immunity can be much looser; to qualify, “[the states] do not have to expressly authorize a specific activity, or proscribe it, for the exemption to apply. . . .  It is enough that a detailed overall scheme of regulation exists.”  Klamath-Lake Pharmaceutical Ass’n v. Klamath Medical Service Bureau, 701 F.2d 1276, 1287 (9th Cir. 1983).

To make this abstract comparison more concrete, let’s next look at a hypothetical.  For a situation similar to FTC v. Ticor Title Insurance Co., 504 U.S. 621 (1992), imagine that a group of liability insurance providers conspired to fix the prices they charge for premiums.  Without any defenses available, price-fixing between and among competitors may be per se illegal under the Sherman Act.  United States v. Socony-Vacuum Oil Co., 310 U.S. 150 (1940).  Enter McCarran-Ferguson; because state insurance commissions regulate premium setting, McCarran-Ferguson immunity may save the cartelizing insurance companies from antitrust liability.  There may be some room for debate whether the price-fixing scheme somehow is an effort to “boycott, coerce, or intimidate,” 15 U.S.C. § 1013(b) (2006), but otherwise, immunity is fairly easily found.

Now consider this same scenario under Parker immunity.  Whether state action immunity will lie depends on the nature of various state insurance agencies’ methods of premium ratemaking.  Some actually make rates, though that approach is rare.  Abraham, supra, at 136.  Other regulatory programs for setting premiums require prior approval by an insurance commission before an insurance company can use them or agency approval after proposed premium rates have been filed with the state commission beforehand.  Id. at 137.  Others still allow insurers to increase and decrease rates within an allowable range, a practice called “flex rating.”   Id. And some agencies will just let private insurers prescribe rates through market competition.  Id. Many of these regulatory schemes would not form a basis for Parker immunity, especially those that require insurer competition in the market.  Furthermore, that state insurance commissions mandate regulatory approval of premium rates as a general matter does not excuse anticompetitive means by insurers to create these rates.  Cf. FTC v. Superior Court Trial Lawyers Ass’n, 493 U.S. 411, 424-25 (1990) (holding that even though private parties may petition the government to allow them to engage in anticompetitive conduct, an antitrust violation may occur if their methods of petitioning are unreasonable restraints on trade in themselves).  Even if an insurance commission allows these practices, as noted above, such authorization of private-party collusion does not necessarily qualify for Parker immunity.

Professors Areeda and Hovenkamp recognize that there is such a the gap between Parker and McCarran-Ferguson.  And for them, that gap might justify a repeal.  Their treatise states:

To the extent these three reasons do not apply to a practice, repeal seems desirable, for the effective impact of McCarran is to immunize activities (1) that would normally be antitrust violations when engaged in by private parties, and (2) where there is inadequate public supervision to qualify for Parker supervision.  Thus the residual impact of repeal would be to force states either to regulate more actively themselves or else leave provable antitrust violations to the antitrust tribunals rather than the unsupervised discretion of private firms.

Areeda & Hovenkamp, supra.

But such unsupervised discretion might ultimately be more favorable to consumers of insurance.  Subjecting the insurance industry to the antitrust laws would mire insurance companies’ in-house legal departments in additional legal research and drive them away from other matters of corporate policy-making.   To the extent that an insurance company wishes to place these legal issues on the desks of outside counsel, the insurance industry may then spend millions in the aggregate on legal fees.  And this says nothing of the possible liabilities for treble damage suits under the federal antitrust laws.  See Abraham, supra, at 189.  As per a discussion on this topic I had with Professor Kircher, the effects could be even more painful for small, local insurers.  In any case, the risk thus arises that these additional costs would be placed on the shoulders of insureds through higher premiums.

Such would be the result if a new law swamped an entire industry with new regulations, but the insurance industry’s antitrust exemption is especially valuable given the history of collaboration among insurance companies, from standard ISO policy forms to data pooling.  Abraham, supra, at 32-34, 189-90.  These collaborative practices allow insurance companies to assess their risk and liability exposures more efficiently.  To the extent such pooling might pose antitrust problems–whether they actually would is a different question–insurance companies may then be forced to endure additional uncertainty as to actuarial data and underwriting.  This too creates a risk of rising premiums.

Imposing even greater costs still is the system variability and unpredictability of the antitrust laws themselves.  The line between antitrust liability and no antitrust liability for a given trade practice is a blurry and moving one.  To be sure, the default rule under the Sherman Act for antitrust violations in section 1, which relates to conspiracies and agreements to restrain trade, is the Rule of Reason.  Texaco Inc. v. Dagher, 547 U.S. 1, 5 (2006). The rule’s name speaks for itself:  it is an overall reasonableness test.  State Oil Co. v. Khan, 522 U.S. 3, 10 (1997) (recognizing that the ”Court has long recognized that Congress intended to outlaw only unreasonable restraints” on trade).  Reasonableness tests are notorious in other areas of the law for their lack of predictability.  Cf. Ira E. Williams, First, Do No Harm: The Cure for Medical Malpractice 52 (2004) (“A legal definition for an acceptable standard of care found in many state statutes is ‘one used by a reasonably prudent practitioner.’  This is so vague as to be meaningless.”).  Even the categories of per se illegal restraints on trade do not inject much certainty into the antitrust analysis, with the Supreme Court’s move away from per se illegality for some trade practices toward more case-by-case reasonableness inquiries and characterization analyses. Lawrence A. Sullivan & Warren S. Grimes, The Law of Antitrust: An Integrated Handbook (2d ed. 2006); accord, e.g., FMC v. Svenska Amerika Linien, 390 U.S. 238, 250 (1968) (“Under the Sherman Act, any agreement by a group of competitors to boycott a particular buyer or group of buyers is illegal per se.”); Northwest Wholesale Stationers, Inc. v. Pacific Stationery and Printing Co., 472 U.S. 284 (1985) (limiting per se illegality to some and not all horizontal group refusals to deal).  And so, Professors Areeda’s and Hovenkamp’s second point–that some practices may not violate the antitrust laws in the first instance–is exceedingly difficult to quantify.

These considerations all demonstrate that McCarran-Ferguson does pull some weight in the antitrust and trade regulation fields, whether as an objective doctrinal matter or in terms of creating expectations upon which insurance companies can rely in their own internal legal compliance programs.

that the conduct with which she is charged is “local in nature” and “should be left to local authorities to prosecute” and that congressional regulation of that conduct “signals a massive and unjustifiable expansion of federal law enforcement into state-regulated domain.” Record in No. 2:07-cr-00528-JG-1 (ED Pa.), Doc. 27, pp. 6, 19. The public policy of the Commonwealth of Pennsylvania, enacted in its capacity as sovereign, has been displaced by that of the National Government. The law to which petitioner is subject, the prosecution she seeks to counter, and the punishment she must face might not have come about if the matter were left for the Commonwealth of Pennsylvania to decide. Indeed, petitioner argues that under Pennsylvania law the expected maximum term of imprisonment she could have received for the same conduct was barely more than a third of her federal sentence.

The Third Circuit, however, ruled that Bond lacked standing to raise her constitutional objections.

In reversing this decision, the Court did not address the merits of the objections.  As a result, it’s hard to say whether there is any sympathy on the Court for the basic claim that the Tenth Amendment may be violated when a federal law criminalizes conduct that is “local in nature.”  Still, it is interesting to put Bond alongside last month’s decision in Fowler, in which the Court cited similar federalism concerns in rejecting an expansive interpretation of a different federal criminal statute.  Perhaps the Court is entering a new phase of heightened concern over the federalization of criminal law.

Cross posted at Life Sentences Blog.

The obvious starting point might be Butch Cassidy’s (or Paul Newman’s) famous question, “Who are those guys?”  Amy Gardner at the Washington Post tries to answer that question here (hat tip to Steven Easley).  Despite her best efforts, a definitive picture of the Movement remains elusive:

[A] new Washington Post canvass of hundreds of local tea party groups reveals a different sort of organization, one that is not so much a movement as a disparate band of vaguely connected gatherings that do surprisingly little to engage in the political process.

The results come from a months-long effort by The Post to contact every tea party group in the nation, an unprecedented attempt to understand the network of individuals and organizations at the heart of the nascent movement.

Seventy percent of the grass-roots groups said they have not participated in any political campaigning this year. As a whole, they have no official candidate slates, have not rallied behind any particular national leader, have little money on hand, and remain ambivalent about their goals and the political process in general.

Jonathan Haidt does some psychoanalysis of libertarians, liberals and conservatives, and tries to show that it is not a love of liberty that unites Tea Partiers, but rather a belief in karma:

The notion of karma comes with lots of new-age baggage, but it is an old and very conservative idea. It is the Sanskrit word for “deed” or “action,” and the law of karma says that for every action, there is an equal and morally commensurate reaction. Kindness, honesty and hard work will (eventually) bring good fortune; cruelty, deceit and laziness will (eventually) bring suffering. No divine intervention is required; it’s just a law of the universe, like gravity.

The whole article is at the Wall Street Journal.  I am not sure that I buy the argument, but the image of Sarah Palin wearing a sari and banging a tamborine is an appealing one. 

The issue that seems to unite the Movement more than any other seems to be the Obama administration sponsored Affordable Health Care Act.  Litigation over the individual mandates contained in the legislation is being closely watched.  Theresa Weisenberger gathers the cases and issues in one location over at the JET Law Blog (the Vanderbilt Journal of Entertainment & Technology Law).  Meanwhile, over at Balkinization, guest bloggers Gillian Metzger and Trevor Morrison provide constitutional commentary.  Their opinion of the Florida District Court case:

In short, the court’s declaration that the individual mandate cannot be deemed an exercise of Congress’s tax power is built upon a hostile reading of the record. If the presumption of constitutionality means anything, surely it is that in areas not subject to a Supreme Court-mandated clear statement requirement, courts should give Congress the benefit of the doubt.

Meanwhile, the issue of immigration seems to confound the Tea Party.  Stewart Lawrence at the Daily Caller examines the contradictions in this post:

Will the Tea Party Movement expand beyond the borders of the United States and become an international movement?  Anna Leutheuser at the Heritage Foundation thinks it will:

The principles that precipitated the first Tea Party – a respect for the rule of law, and desire for limited government and individual liberty – are universal; and they are just as threatened now as they were at the time of the American founding.  This time, however, the United States is not alone in coming to their defense.

Finally, we go back to Balkinization to give Jack Balkin the last word on the Tea Party Movement: 

What changed during the 1960s and afterwards was the creation of a New Right, and the joinder of social conservatives, business conservatives, anti-welfare state conservatives, anti-regulatory conservatives, anti-tax conservatives and foreign policy conservatives. That alliance made it possible for the rich and for corporations to bankroll a wide range of conservative causes, in the belief that a rising tide (of anger) would lift all conservative boats. Corporate interests could ally themselves with the Republicans’ form of populism as long as social conservatives would keep voting for candidates who would favor business interests and seek to lower taxes on the wealthy and corporations.

This basic feature of modern American conservatism has not really changed with the emergence of the Tea Party, even though the Tea Party presents itself as a new form of political organization, alienated in part from the mainstream of the Republican Party. The Tea Party, however differently it may be organized, is just the latest incarnation of the most conservative elements of the late 20th century conservative coalition, this time featuring a special emphasis on opposition to the size of government and government taxation. That emphasis makes the Tea Party a natural object of corporate support, albeit mostly hidden corporate support, because many in the Tea Party also are not that fond of the Wall Street bailout either.

That’s all for now.  As Craig Ferguson says, “I look forward to your letters.”  Please remember our comments policy:

We hope that this blog will be a robust forum for civil and well-informed discussion of important issues and ideas. To that end, we welcome the submission of comments from readers in response to posts. We reserve the right not to publish comments based on such concerns as redundancy, incivility, untimeliness, poor writing, etc. All comments must include the first and last name of the author and a valid e-mail address.

Taking pride of place among the “long-ago texts” highlighted in the article is Friedrich Hayek’s 1944 book The Road to Serfdom.  Hayek is often cited by the movement’s followers for his argument that a government that intervenes in the economy will inevitably intervene in every aspect of its citizen’s lives.  If one accepts this premise, it is easy to understand why members of the Tea Party Movement reacted with hostility to the Troubled Asset Recovery Program (TARP), health care reform, and the bailout of the domestic auto industry.  For Tea Party followers, these separate policies – when viewed together — comprise a centrally planned economy reminiscent of the Soviet Union’s infamous Five Year Plans.

As I have explained elsewhere, some of Hayek’s devotees even argue that we should interpret the Constitution’s Commerce Clause as if the founders of our nation sought to maximize market competition free from government restraint along the lines of Hayek’s theories.

Defenders of the federal government’s intervention in the economy rely upon their own “long-ago text,” the writings of John Maynard Keynes.  Keynes argued that counter cyclical public spending could be used to counteract economic downturns.  His theories hold that in times of high unemployment the government can use deficit spending in order to stimulate demand (i.e., through public works projects) and that this spending will increase employment.

While Hayek and Keynes have traditionally been placed at the two ideological extremes of economic theory, the views of both men suffer when their major premises are exaggerated by their followers.  Keynes himself admitted that his views evolved over time and that he no longer agreed with some of his writings.  It is fair to say that Keynes was something of a slippery target when it came to being pinned down on specifics.

Some evidence that the views of Keynes and Hayek may not be as diametrically opposed as their followers often allege can be seen in the letter that Keynes wrote to Hayek after the publication of the The Road to Serfdom.  In the letter, Keynes claims to agree with almost everything that Hayek wrote.  In fact, several complimentary sentences from the letter were used as a blurb on the back cover of the paperback edition of Hayek’s book.     

Essentially, Keynes agreed with Hayek that a completely centralized economy would be undesirable, while noting that Hayek himself accepted some forms of government regulation as permissible.  His main criticism of The Road to Serfdom was that Hayek never explained how much government regulation was too much regulation:

You admit … that it is a question of knowing where to draw the line. You agree that the line has to be drawn somewhere, and that the logical extreme is not possible. But you give us no guidance whatever as to where to draw it…. As soon as you admit that the extreme is not possible … you are, on your own argument done for, since you are trying to persuade us that so soon as one moves an inch in the planned direction you are necessarily launched on the slippery path which will lead you in due course over the precipice.

(This famous portion of Keynes’ letter is quoted in an excellent 2006 essay by Robert Skidelsky which, among other strengths, draws interesting parallels between Hayek and George Orwell).

Hayek attempted to answer Keynes’ question on where to draw the line with his book The Constitution of Liberty published in 1960.  It is this book, more than The Road to Serfdom, which strikes me as a major influence on the intellectual arguments of the Tea Party Movement.  It is difficult to read The Constitution of Liberty today without observing the many ways in which its arguments have been carefully extracted and used to deny that the federal government has any legitimate authority to regulate health care or the financial markets.

[As someone who teaches Constitutional Law, Securities Regulation, and Immigration Law, I would be greatly pleased if Hayek used his opposition to excessive government regulation of the economy as a basis for criticizing government control over immigration.  Had Hayek advocated in favor of open borders, as some of his self-professed followers have subsequently done, then I could critique his theories across all three of my primary teaching areas.  Alas, Hayek defended the role of the government to pick and choose among potential immigrants as a means of favoring persons who (government planners believed) would be more likely to acculturate.  By waffling on immigration, Hayek deprived me of a consistent theory that would tie all three of my subjects together.] 

Perhaps because Hayek is forced to be more specific in outlining his theories in The Constitution of Liberty, rather than relying upon generalities as he did in The Road to Serfdom, I do not believe that the later book has aged as well.  Lest anyone be tempted to stop reading immediately on the grounds that any critic of Hayek must be blinded by a “liberal bias,” I will link here to a critical review of The Constitution of Liberty by Jacob Viner, an economist often cited as having helped to inspire “the Chicago School” of economics theory.

In my opinion, Hayek’s weakness is that he sees the world he lives in very clearly, but that he errs in deriving eternal principles from what is in essence a transitory stage in the evolution of global markets (of course, one could criticize Karl Marx on the same basis).

For example, he argues that an economy that develops free of government control will naturally come to incorporate beneficial social arrangements, through the free choices of its participants.  These naturally occurring arrangements will of necessity be preferable to state-planned social arrangements, he argues, because state planners will never have information regarding the wants and needs of the public that is comparable to the information available to market participants.

Of course, we now appreciate the fact that the economy of the United States during the 1950s blithely supported tobacco companies and industrial polluters who were imposing unseen and long-term health costs on the population (call this the “Mad Men” economy).  The regulation of tobacco products by the federal government, and the passage of the Clean Water Act and the Clean Air Act, constituted significant restrictions upon the free choices of market participants.  We are all better off because of these government interventions.  Would a similar result have occurred without government intervention?

Similarly, Hayek argues that the economic progress of the masses is only possible if we allow an elite minority to amass significant material and financial wealth.  He argues that economic progress occurs when a small vanguard stimulates demand for material goods among the broader population, who naturally desire the comforts that they observe the elite enjoying.  The increased demand will lead to a greater production of material goods and more jobs for the masses, which will allow an increase in wealth to expand throughout the society.  Hayek’s economic “story” only works, however, if the increased production jobs stay in the United States.  When companies ship production jobs overseas, it is the living condition of foreign workers that gets raised and not domestic workers (call this the “Outsourced” economy).

Most importantly, Hayek’s argument that optimal social benefits can result from an evolutionary process of free competition amongst firms, rather than through central government planning, elevates gradualism over decisive government action.  This leaves us with no options when financial markets seize up, short-term credit becomes unavailable, and, in the memorable words of John McCain, “the economy is about to crater.”  It may be true that the existing system of financial regulation has failed to keep pace with changes in the marketplace and with a growing element of systemic risk among inter-connected markets.  I believe that regulation needs to change and evolve in response to changes in the industry that it oversees.  However, even conceding the inadequacy of current law, it is difficult to see how the complete absence of financial regulation would have prevented the Financial Meltdown of 2007.       

Hayek’s observations on the risk of centralized government planning were timely in the face of the rising influence of the Soviet Union and China as viable economic models.  His focus on the expansion of material wealth in the United States as an example of the benefits of mildly regulated competition is, in retrospect, an example that reflects the post-World War II boom domestically and the shambles of Europe’s post-war economy.  Hayek made important contributions to our understanding of economics, of course, but many of the arguments that his followers have adopted as undeniable truths seem to me to be inextricably linked to their particular time and place.

By the end of The Constitution of Liberty, Hayek reveals himself to be much less of an absolutist in defense of unregulated competition than his followers.   This should come as no surprise.  In the Road to Serfdom Hayek telegraphed his acceptance of a state role in regulating the economy.  Far from advocating a laissez faire approach to regulation, Hayek actually justifies a role for the state as the enforcer of a legal framework designed to control competition – he defends laws that mandate safe work environments and minimum wages, defends laws that prevent polluters from externalizing their costs onto their neighbor, and defends laws that penalize fraud and deception.  He argues that state regulation is legitimate if it promotes competition, and illegitimate if is it is designed to stifle competition.  It turns out that there is some middle ground between Hayek and Keynes after all.

One of the arguments in favor of health care reform and financial markets reform is that the prior legal regimes did not prevent market participants from externalizing their costs onto others.  We can argue over whether that is true or not, and over whether the legislative reforms enacted under the Obama administration do a better or worse job of forcing competitors to internalize their costs, but it is a misreading of Hayek to argue that the very attempt to regulate the market is mistaken.

In fact, as I read The Constitution of Liberty, Hayek would likely have agreed with Theodore Roosevelt, who wrote the following about the industrial age in his Autobiography:

[A] few men recognized that corporations and combinations had become indispensable in the business world, that it was folly to try to prohibit them, but that it was folly to leave them without thorough-going control . . . They realized that the government must now interfere to protect labor, to subordinate the big corporation to the public welfare, and to shackle cunning and fraud . . .

Yet somehow Friedrich Hayek has come to symbolize an extreme form of hostility towards government economic regulation.  As often happens (see, e.g., Adam Smith), Friedrich Hayek has become more important for the principles that he supposedly stands for than for what he actually said.

Many advocates for legal recognition of same-sex marriage are deeply worried by Perry. Dale Carpenter, for example, is concerned that the breadth of the arguments considered in Perry could lead to a sharply negative precedent if the case is reversed on appeal. Those fears are legitimate. An Equal Protection or Due Process argument mandating equal treatment for low-status individuals is what might be called “a nuclear bomb of a legal theory” — it applies everywhere, all at once, and obliterates legal distinctions meant to enforce low social status. The same applies, to a lesser extent, to arguments that the Full Faith and Credit Clause mandates recognition of valid same-sex marriages by every other state in the union. Courts might be hesitant to, so to speak, stop worrying and learn to love the bomb. Marched to the precipice too quickly, they might find some way to pull back from the brink.

If that happens, and if American society continues to develop tolerance for same-sex couples, will we be locked into sub-optimal constitutional doctrine? Not entirely. As I argue in my forthcoming article on this subject (in the Alabama Law Review), there is an escape valve.

In the scenario I’m envisioning, a large number of states have opted to recognize same-sex marriage, a nearly equal number forbid it, and no federal rule (equal protection, due process, congressional statute) resolves the issue. That scenario raises the possibility of intractable and irresolvable legal and social conflict between states. Valid same-sex marriages would evaporate and re-appear as couples travel across the country, with attendant disruption for state citizens and interstate travel. It was exactly that sort of conflict, I argue, that the Privileges or Immunities Clause of the Fourteenth Amendment was in part intended to address. The Privileges or Immunities Clause was envisioned as a response to antebellum restrictions on the travel of free black citizens from northern states. Northerners argued that states such as Missouri or Oregon that banned free blacks entirely, or states such as South Carolina or Louisiana that imprisoned and even enslaved free black sailors, violated the Article IV Privileges and Immunities Clause: “The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.” The southern and western response to this argument, ultimately embraced by the Supreme Court in Dred Scott, was that northern states could not grant blacks full citizenship status for purposes of Article IV; that is, the Privileges and Immunities Clause required only that states grant black visitors with the same (lack of) privileges they gave their own black inhabitants, not their citizens per se.

The Privileges or Immunities Clause was intended, at least in part, as the decisive northern rebuttal to this argument. It was intended to encode the northern understanding of the Privileges and Immunities Clause, under which states could not refuse to grant the citizens of another state all the privileges and immunities of their own citizens, without distinctions originating from a contested status regime not recognized by the citizen’s home state. The trick is in determining what that might apply to other than racial distinctions. In the aftermath of the Slaughterhouse Cases, which effectively gutted the Privileges or Immunities Clause, the Equal Protection Clause has done most of the work as the Reconstruction Amendment’s weapon against racial discrimination. State citizenship is irrelevant for Equal Protection Clause purposes; the clause applies to home state citizens and visitors (even non-citizens) alike.

I argue in my paper that the Privileges or Immunities Clause should only be invoked in this fashion in situations that somewhat mirror the antebellum situation: with states more or less evenly divided between sharply contested status regimes that are comprised of social status structures backed by state law. Formal recognition and formal non-recognition of same-sex marriage by state law would count as “sharply contested,” but with only six jurisdictions currently granting such marriages (and another three recognizing them), the states are not yet anywhere close to “evenly divided.” Thus the escape clause offered by the Privileges or Immunities Clause might never be needed; even if there is a negative equal protection or due process holding in a Perry appeal, courts down the line could reverse course in the wake of societal change. But if a federalist deadlock occurs, the reconstructed Constitution does not leave courts powerless to deal with it.

There is a huge, obvious problem with the law. The bar studiously ignores it. Even the legal academy generally pretends it’s not there. It’s so large as to be beyond overwhelming.

The problem is this: Our system of justice is absurdly complex and time consuming.

. . .

There are three basic aspects to the mess: Endeavoring to understand the law is unduly complex and expensive, determining the facts is unduly complex and expensive, and teeing up the law and the facts for judges and juries is unduly complex and expensive.

In addition to a lively string of comments (including a couple by our own Rick Esenberg), Eric’s comments also prompted a thoughtful responsive post by Paul Horwitz.  Paul questions, among other things, what the alternative is to our current, complex system and whether such an alternative really would be an improvement.

The civil litigation costs that are Eric’s real target are, it seems to me, simply a part of the transaction costs that result from the way we in the United States have chosen to regulate ourselves.  One could imagine a number of other systems that might have significantly lower transaction costs (e.g., we could regulate ourselves by giving executive branch bureaucrats unreviewable discretion to resolve social problems however they see fit), but it is at least highly questionable whether any such alternatives would be preferable to what we have.  To be sure, we should seek to minimize transaction costs, and there are undoubtedly many small reforms that we could adopt that would help the legal system to operate more efficiently.  But, from a big-picture perspective, it is not clear to me that litigation-related transaction costs are an especially large drag on the American economy.  Indeed, I would be surprised if they were not significantly less than the transaction costs associated with health care delivery.

Elsewhere in the blawgosphere, Corey Yung has an insightful post at Concurring Opinions on federalism in the Rehnquist and Roberts Courts.  He writes,

As a result of the [Rehnquist] Court’s opinions in Lopez and Morrison, many legal scholars felt that the Commerce Clause was seemingly reinvigorated as a means of limiting federal power. . . . To many, the revolution came to a screeching halt with the Court’s ruling in Raich. However, it was still possible to reconcile the doctrine in Raich (as a logical extension of Wickard v. Filburn) with Lopez and Morrison. . . . However, with the Court’s recent decision in United States v. Comstock, the legacy of Justice Rehnquist in regards to the Commerce Clause seems to have vanished.

. . .

One could simply view the Roberts’ Court’s counter-revolution as having shutdown Justice Rehnquist’s efforts. However, I think it is simpler and more accurate to say that there was never any revolution.

Finally, also at Concurring Opinions, Lawrence Cunningham has a helpful summary and critique of the new executive pay provisions of the Dodd-Frank Act.

As noted in my blog post last week (“The Beginning of Health Reform“), pushback against the federal Patient Protection and Affordable Care Act was swift.  Members of nearly 40 state legislatures have proposed legislation or constitutional amendments limiting or opposing certain provisions of the Act, with most of the proposals targeting the Act’s requirement that individuals have health insurance coverage or subject themselves to financial penalties (the “individual mandate”).  Virginia, Idaho, and Utah are the only states thus far to have enacted new statutes (each of which more or less prohibits compliance with any law that imposes a fine on an individual for declining to enter into a contract for health insurance coverage), and their validity is sure to be challenged in court on Supremacy Clause and other grounds.  Idaho has also passed a non-binding resolution “urging Congress to take action forthwith to amend the United States Constitution by adding a Twenty-eighth Amendment to provide that Congress shall make no law requiring citizens of the United States to enroll in, participate in or secure health care insurance or to penalize any citizen who declines to purchase or participate in any health care insurance program.”

Most dramatic, though—if drama is measured by the amount of media coverage generated—is the lawsuit initiated by the Attorney General of Florida and joined by 19 other state Attorneys General maintaining that several components of the health reform law violate Article I of and the Tenth Amendment to the U.S. Constitution.  The argument that is drawing the most attention concerns the constitutionality of the Act’s individual mandate.  Like the contention at the heart of the state proposals, the Florida lawsuit argues that the Act’s requirement that individuals have health insurance coverage or pay a tax penalty amounts to an unconstitutional mandate that cannot be upheld under the Constitution’s Commerce or Spending Clauses.

The lawsuit seems unlikely to ultimately succeed, given the procedural and substantive hurdles it has to clear.  Before the merits of the states’ arguments can be addressed, the courts have a series of procedural questions with which to grapple: Is Massachusetts v. Mellon, which holds that states do not have standing to challenge the constitutionality of federal laws, controlling?  If not, is the lawsuit ripe, given that the individual mandate is not effective until 2014?  If ripe, does the federal Tax Anti-Injunction Act, which as a general matter prohibits courts from entertaining lawsuits seeking to enjoin the government from assessing a tax, bar the relief the states seek?

The states would appear to have an uphill battle substantively, as well.  Their lawsuit directly challenges two of Congress’s broadest powers—to tax for the general welfare, and to regulate interstate commerce.  The Supreme Court and lower federal courts have long accorded great deference to congressional decisions that a particular tax provides for the general welfare.  Similarly, the Commerce Clause has been the approved constitutional basis for many of the federal statutes passed over the last half-century.  At the same time, whether the clause can serve as the basis for a mandate to purchase a particular good is a novel issue.  For its part, the federal government earlier this week filed its first brief defending the legality of the individual mandate, essentially arguing that Congress can force people to buy health insurance because the decision to be uninsured has a broad economic effect.

With many states likely to eventually pass statutes or constitutional amendments contravening the individual mandate, and with the Florida lawsuit already in play, it will be interesting to watch as several geographically-diverse lawsuits percolate up through the federal courts, with judges across the ideological spectrum weighing in.  In the meantime, implementation of the Act is moving swiftly, with multiple federal agencies quickly designing proposed implementing regulations.

The emergence of the Tea Party Movement as a political phenomenon has generated a great deal of media attention and punditry over the last year.  Most observers have concluded that those who self-identify as “tea partiers” comprise a loose amalgamation of libertarians, states’ rights advocates and opponents of government intervention in the free markets.  While most activists have a Republican voting record, the Movement appears to have arisen independent of the Republican Party.  Critics of the Bush Administration’s domestic spying activities stand shoulder to shoulder with skeptics of the Obama Administration’s health care reform efforts.  To the extent that Tea Party activists share one common political philosophy, that philosophy might best be described as “rage against the federal government.”

Liberals seem inclined to deny the existence of any intellectual content behind the Tea Party Movement, preferring to focus on the undeniable presence of some racists, militia members, and conspiracy theorists among the activists.  While it is safe to assume that, for some, anger at the federal government seems inextricably connected to the fact that an African-American is President, Juan Williams is correct when he identifies the core concerns of the Movement as non-racial.  Similarly, the “birthers” and other fringe elements in the Movement are merely piggy backing on a generalized anger against the federal government that does not derive from their parochial concerns.  Our nation’s public discourse would benefit greatly if conservative intellectuals did more to repudiate these fringe elements, much the way that William F. Buckley famously repudiated the John Birch Society in 1965, but the “anger industry” that profits off of cable television, books and political fundraising appeals is apparently loathe to alienate any of its prime consumers.

There is, in fact, a long tradition of antipathy towards the federal government reflected in our nation’s history.  Historian Garry Wills produced a taxonomy of anti-government ideologies (on both the right and the left) in his book A Necessary Evil.  I recommended this book in an earlier post.  Wills discusses past political movements led by nullifiers (who believe that local law is more authentic and worthy of respect than federal law), secessionists (who believe that states as political units can withdraw from the union if local residents dissent from federal policies), insurrectionists (who believe that violence directed against the federal government is justifiable), vigilantes (who take it upon themselves to enforce social values that the federal government fails to pursue diligently), withdrawers (who seek to separate themselves from a corrupt society), and disobeyers (who use civil disobedience to challenge particular government policies).  Anyone who seeks to identify the core constitutional values of the Tea Party Movement should begin by immersing themselves in this history.

I believe that there is an intellectual content to the Tea Party Movement, and that many Tea Party activists are attempting to further meaningful constitutional values.  What I find significant is the manner in which the debate over health care reform has illuminated a shift away from the tradition of using states’ rights as a counterweight to federal authority and towards a renewed focus on the structural limits that the Constitution places on the power of the federal government.  In some cases, this law will require individuals to purchase private health insurance, and arguments over the constitutionality of the law usually begin with the premise that Congress lacks the power to impose such a mandate under the Commerce Clause.  This editorial by the Wall Street Journal is typical.

However, the editorial’s position is merely an invitation to re-argue questions of federalism and economic regulation that have been decided in favor of the federal government since the time of the New Deal.  It is certainly possible that the conservative majority on the Supreme Court will revisit the scope of Congress’ Commerce Clause authority (the Citizens United v. FEC opinion illustrates how loosely the bonds of precedent seem to constrain this Court), but it seems unlikely that the current members of the Court will choose to go down a path that it declined to take in Gonzales v. Raich.  For this reason, the academic response to health care reform legislation has been strongly on the side of its constitutionality.

Much of the rhetoric of the Tea party Movement has not been about states’ rights and federalism, however.  Instead, there has been an emphasis on “delegated powers” and “limited federal authority.”  This reaction to the health care reform legislation seems to reach back in time in order to resurrect the original understanding of our Constitution as a charter whereby a sovereign people grant discrete powers to the federal government.  This is not a view that has been associated with either political party, Republicans or Democrats, in recent years.       

There is no need to address the manner in which the Democrats, in furtherance of economic security and civil rights, came to embrace an expansive view of federal government authority.  Less appreciated is the manner in which Republican Presidents also governed in a manner that accepted the broad scope of federal power.  President Nixon greatly expanded federal payments to the working poor and imposed wage and price controls to combat inflation.  Reagan biographer Lou Cannon concludes that President Reagan, despite his anti-government rhetoric, had no desire to sacrifice his popularity by rolling back New Deal social programs, no doubt that an increase in military spending was necessary, no intention of foregoing promised tax cuts, and no understanding of why eight consecutive unbalanced budgets reflecting this combination of priorities would cause the size of the federal deficit to explode.  Both Nixon and Reagan also promoted the growth of the federal government as a means of combating the external threat of communism.

In many ways, President George W. Bush adopted policies that further pushed federal power beyond clearly delegated bounds.  Not content merely to leave the New Deal social safety net in place, he added significantly to it with prescription drug coverage for seniors and the No Child Left Behind Act.  At the same time, his national security policies adopted the neo-conservative view that a muscular exercise of military power to combat terrorism is unconstrained by any constitutional limits.

The Tea Party Movement reflects a fissure in the coalition of interest groups that have traditionally supported Republican political candidates.  In particular, it appears that the advocacy of states’ rights is no longer a sufficient proxy for expressing an anti-government philosophy.  Instead, Tea Party activists demand that the federal government stay within strict boundaries of delegated powers.  Left out are elements of the Republican “base” such as national security “hawks” who express a more accommodating attitude toward federal power.  Those who argue that President Obama is not doing enough to keep Americans safe must try to find common ground with those who assert that the executive branch is limited by its delegated powers.  Also not invited to the Tea Party are large corporate interests who might rationally prefer to deal with one federal regulator as opposed to fifty state legislatures.  A business that prefers a uniform and prompt legislative response to its concerns must find common ground with those who deny that Congress has any authority to legislate.

I remain fascinated by the arguments about basic federalism principles that one sees reflected every day in the media and in the halls of Congress.  My article is an attempt to provide a historical context against which to judge the contemporary debate about the scope of federal government authority.  The article begins with an examination of the manner in which the contractual nature of the Constitution   illuminates the original understanding of the text.  By closely examining the historical evidence, I argue that our interpretation of the Constitution has been influenced by dueling conceptions of contractual origin.  One view treats the Constitution as a charter that delegates limited and defined authority to the federal government.  The second view treats the Constitution as a compact the terms of which reflect a bargain between the federal government and a discrete body public.  After discussing the important differences between these two views of the Constitution, the article discusses the manner in which the compact view came to eclipse the delegation view over the course of our nation’s history.

However, the article concludes by suggesting a connection between the Tea Party Movement and the core constitutional values promoted under the delegation view.  These values are the public policing of constraints on federal power, the primacy of popular sovereignty, and the elevation of human rights over government authority.  Whatever the political consequences of the emergence of the Tea Party Movement , the re-ascendancy of the delegation view as a part of the public debate over the meaning of the Constitution may aid in our understanding of the original constitutional design.

To read “Charters, Compacts, and Tea Parties: The Decline and Resurrection of a Delegation View of the Constitution,” follow this link and click “download.”

As such, Citizens United v. FEC stands with District of Columbia v. Heller, the Second Amendment case decided in 2008, as an example of the Justices slapping the “originalist” label on a profoundly un-originalist interpretation of the Bill of Rights.  It is appropriate to view the two cases together.  Both are exercises in raw political power employed in order to accomplish conservative objectives.  Both ignore hundreds of years of understanding about the meaning of the relevant constitutional provisions, in favor of a meaning derived by taking the words of the Amendment out of context.  And both embrace interpretations of the constitutional Amendment at issue that are inconsistent with the meaning ascribed to that same language by the intellectual father of originalism, Robert Bork.  In the same way that modern scholars deride the “Lochner era” as a misguided period in American Constitutional Law, I believe that future scholars and judges will recognize and reject the intellectual dishonesty of the “Heller era.”

We begin, as we so often do, with John Marshall.  Justice Marshall’s reading of the Constitution was clearly a reading that respected the rights of property.  As R. Kent Newmyer succinctly summarized it, in his book “John Marshall and the Heroic Age of the Supreme Court,” Marshall understood the rights of property ownership to include an individual’s right “to acquire property and deploy it creatively as he saw fit and to enjoy its fruits without hindrance.” (Newmyer p. 264)  But this does not mean that Marshall embraced Adam Smith’s theory of completely free markets, where private business enterprises act completely free from government regulation.  First of all, not even Adam Smith advocated for markets that were sealed off from all government regulation.  Second of all, while the Framers of the Constitution were aware of Adam Smith, there is little evidence that Smith’s economic theories influenced the Constitution.

John Marshall’s understanding of how the Constitution protected property rights was, characteristically, derived from his understanding of federalism.  Justice Marshall struck down state laws that interfered with private property rights, for example in Fletcher v. Peck and Dartmouth College v. Woodward, because those laws violated the Contract Clause of the Constitution.  However, Marshall’s motivation was not to protect private economic activity from all forms of government regulation.  His motivation was to protect national economic interests from protectionist state laws.  Marshall viewed the states less as political units and more as local interest groups that would pass legislation favoring parochial economic interests over interests from out of state.  If the young United States of America was to build a truly nationwide economy, private enterprise had to be able to grow free from the constant parade of protectionist legislation being passed by the states.  As stated by Newmyer: “What he feared . . . was state legislative meddling with contracts, either by passing laws that undercut contracts between individuals or by reneging on its own.” (Newmyer p. 265)

Marshall’s protection of the rights of property, therefore, is not inconsistent with the idea of uniform, federal regulation of private enterprise when in the public interest.  (Kutler, infra, p. 67) Marshall simply never faced this issue.  The corporations in existence at the time of his opinions were not national in scope, and corporate activity that exploited labor or endangered consumers would not become common until the industrial revolution.  Marshall used the text of the Contracts Clause to clear local state laws from the path of private enterprise, and no more.  He sought to support a system of federalism where national interests could act free from state constraints.  He did not seek to completely immunize private enterprise from all government regulation. (Kutler, infra, p. 179)

Those who put their faith in the “invisible hand” of the marketplace often assert that the owners of a private enterprise have a natural law right to use their property as they see fit, free from any government interference.  The Supreme Court rejected this argument shortly after John Marshall’s death when, in 1837 the Court decided the Charles River Bridge Case.  The majority of the Court held that the Massachusetts legislature, by granting a charter to the proprietors of a toll bridge, did not violate the Contract Clause of the Constitution by subsequently chartering the construction of a competing (and free) bridge.  As explained by University of Wisconsin law professor Stanley Kutler in his classic book, “Privilege and Creative Destruction,” the case strongly affirmed the power of government to regulate the use of private property.  In the words of Chief Justice Taney, “The continued existence of a government would be of no great value, if . . . it was disarmed of the powers necessary to accomplish the ends of its creations; and the functions [government] was designed to perform, transferred to the hands of privileged corporations.” (Kutler p. 91)  The Constitution has never been interpreted to preclude government regulation of a private business enterprise for the public good.

The specific treatment of corporations under the Constitution is entirely consistent with this treatment of private property in general.  There is no evidence that the Framers’ generation understood corporations to have any rights under the Constitution separate from the rights of the persons who owned the corporation.  In fact, for most of our nation’s history, the Supreme Court denied the existence of any rights for corporations under the Constitution at all.

This history is usefully summarized in a forthcoming article by David Gans and Douglas Kendall.  In 1809, Justice John Marshall wrote in Bank of U.S. v. Deveaux that corporations were not “citizens” as that word was used in Article III of the Constitution.  Unfortunately, the result of the ruling was that corporations evaded the jurisdiction of the federal courts in order to avoid paying their debts.  Therefore, the Court quickly overruled Deveaux and adopted the legal fiction that corporations could be deemed “citizens” for purposes of suing or being sued in federal court.  The Court’s motivation in adopting this legal fiction, however, was to preserve the ability of natural persons harmed by a corporation to avail themselves of the diversity jurisdiction of the federal courts.

In 1839 the Court specifically ruled that the treatment of corporations as “persons” for diversity jurisdiction purposes did not grant corporations any of the other rights that the Constitution granted to natural persons.  The Court never extended any of the individual rights provisions of the Constitution to corporations until the end of the 19^th century.  Nor did the Court ever suggest that the federal government lacked the power to regulate corporate activity, so long as the government did not violate the literal terms of the corporate charter.

The first case extending constitutional rights to corporations came in 1897, under the Equal Protection Clause of the 14^th Amendment, and it ushered in the Lochner era when the Supreme Court used theories of substantive due process to assert that the Constitution protected corporations from federal economic regulation.  It is significant that this innovation came via an interpretation of a Reconstruction-era constitutional amendment, and not from a purported interpretation of the original text.  Moreover, in non-economic areas, such as the rights of self-incrimination, the Court continued to refuse to recognize any constitutional right for corporations.  Also, during this era, two giants of the law, Oliver Wendell Holmes and Louis Brandeis, dissented often and aggressively from all extensions of constitutional rights to corporations.

The Lochner era ended in 1937, after President Roosevelt threatened to pack the Supreme Court.  The Supreme Court retreated from its Lochner line of cases and once again began to uphold the federal power to regulate corporate affairs.  Over time, however, the Supreme Court began to hold that this power to regulate corporate activity was tempered by the existence of constitutional rights for corporations under the 14^th Amendment and under the criminal procedure provisions of the Constitution.

The true revolution occurred in 1978, when the Supreme Court ruled in First National Bank of Boston v. Bellotti that a state law limiting the ability of corporations to spend money on referenda elections that didn’t affect their property was unconstitutional.  The ruling did not explicitly hold that corporations had a First Amendment right, but it did say that the protection of speech was so important that it didn’t matter who was doing the talking.  This ruling was revolutionary because it was a departure from precedent that, with the exception of the Lochner era, had held that the distinction between the regulation of corporations and the regulation of individuals is an important distinction under the Constitution.

However, the Bellotti opinion was careful to preserve the power of the government to regulate corporate spending in the context of candidate elections, as opposed to referenda.  The Court continued to recognize this power to regulate corporate money in FEC v. National Right to Work Committee, in Austin v. Michigan Chamber of Commerce, and in McConnell v. FEC.  These latter two cases contained spirited dissents from Justices Scalia and Kennedy arguing that the First Amendment right that protected corporations in Bellotti should be extended to the context of candidate elections.

In Citizens United v. FEC, these dissents become the majority opinion, and the Austin and McConnell decisions were overruled insofar as they allowed the federal government to prevent corporations from making independent expenditures on behalf of candidates for office.  Not only are these prior cases overruled, but the history of the Court’s treatment of corporations under the Constitution is ignored.  Ignored, as well, is the Court’s pre-Lochner understanding that the Constitution permits the government to regulate corporate activity when it is contrary to the public interest.

Instead, what we get in the Citizens United opinion is the textualist assertion that the language of the First Amendment does not distinguish between whose speech is being regulated, so the government must therefore lack the power to makes a similar distinction.  We are told that the benefits of political speech are the same, whether the source of that speech is an individual or a corporation.  And we are told that media corporations, that report the news, might be subjected to government control if we do not recognize a First Amendment right for corporations.

Similar arguments were rejected by Robert Bork.  Bork clearly did not understand the First Amendment to require a complete absence of government regulation over speech.  For example, in his 1971 Indiana Law Journal article, Bork argued that the First Amendment does not prevent the government from regulating speech outside of the political context if that speech causes public harm.  Bork wrote that the Framers “displayed a determination to punish speech thought dangerous to government.”  For him, it was the impact of the speech at issue on the political process (positive or negative) that determined whether the speech was protected under the First Amendment, and not an absolutist interpretation of the text.

Justice Kennedy’s arguments were also rejected by Justice William Rehnquist, who dissented in Bellotti. Rehnquist stressed that “early in our history” the Supreme Court had declined to extend constitutional rights to corporations.  He viewed the Bellotti majority as acting inconsistently with this original understanding.  Therefore, the so-called “orginalism” that Justice Kennedy says requires us to depart from longstanding precedent is in fact contrary to earlier interpretations of the First Amendment by two notable originalists.

Justice Stevens’ dissent in Citizens United contains a devastatingly accurate characterization of Justice Kennedy’s argument:

As a matter of original expectations, then, it seems absurd to think that the First Amendment prohibits legislatures from taking into account the corporate identity of a sponsor of electoral activity.  As a matter of original meaning, it likewise seems baseless – unless one elevates the First Amendment’s ‘principles’ or its ‘purpose’ at such a high level of generality that the historical understandings of the Amendment cease to be a meaningful constraint on the judicial task.  This case sheds a revelatory light on the assumption of some that an impartial judge’s application of an originalist methodology is likely to yield more determinate answers, or to play a more decisive role in the decisional process, than his or her views about sound policy. 

What does support the majority’s interpretation of the First Amendment in Citizens United?  We are left with Justice Kennedy’s personal preference that corporations should have a voice in the political arena.  Except what is this “corporate voice” that needs protection?  It is most assuredly not the voice of the shareholders.  State law provides them with no mechanism to approve in advance the use of corporate funds for political activity, and under state law shareholders have little prospect for successfully punishing management after the fact for the use of corporate funds to sponsor political activity that they disagree with.  In addition, given that during 2009 the average share of stock was bought and sold two and one half times, shareholders will probably not own their shares long enough to care what management does with corporate money.  With the turnover in corporate ownership today, we do not have share-holders, we have share- renters.  In this context, the corporate voice is reduced to the voice of top management, who will use corporate money to fund political views that these highly compensated individuals are fully capable of funding out of their own pocket.

When it comes to the First Amendment, therefore, it seems that an ideological preference for free markets trumps traditional notions of federalism and free speech.    

Note:  The photo accompanying this post depicts the cover of Harper’s Weekly January 21, 1888 and is entitled “Not Even-Handed Justice: Crushing the Scorpion of Anarchy But Sparing the Octopus of Monopoly.”  A framed copy hangs in my office.

The Republican Party in America currently stands at a crossroads.  There has been a great deal of debate within the political punditry concerning whether the Tea Party movement is a positive or a negative development for the Republican Party.  Some observers have noted the friction between the rage being expressed by Tea Party activists at the government bailout of the financial markets and at the expansion of government regulation of the health care sector, on the one hand, and the more business and government friendly track record of establishment Republican officials on the other.  This friction was most evident last month, when conservative activists rejected the establishment candidate put forth by party leaders for the 23rd Congressional District in New York, split the Republican vote, and delivered the seat to a Democrat.   

Similarly, Sarah Palin’s book tour has engendered speculation about her future political plans.  Some have applauded her anti-Washington and anti-big government philosophy as reflective of the public‘s current attitudes.  In the wake of the Administration of President George W. Bush, who spoke like a “States’ Rights” Texas governor while simultaneously expanding the federal government in the name of education and national security, many conservatives look to the former Alaska governor as someone who might actually govern in accord with a political philosophy that promotes decentralized government.  However, other observers have questioned whether Sarah Palin’s appeal extends beyond regional and rural areas of the country.

Democrats have their own problems.  The liberal wing of the Democratic Party finds fault with much of what President Obama does (a troop surge in Afghanistan) and doesn’t do (end “Don’t Ask/Don’t Tell,” close Guantanamo Bay sooner).  Meanwhile, centrist Democrats struggle to find a recipe for health care reform that is neither too big nor too ineffective.  It is as if the Democrats, now in possession of the federal government, cannot decide what to do with it.    

My previous blog posts have often reflected a preoccupation with the role of federal power in our constitutional system.  Previous posts have sought to track the manner in which the debate between centralized federal power versus states rights has persisted and evolved throughout our nation’s history, and to offer a defense of a strong federal government as both faithful to the original intent of the Constitution and as vital to maintain our country’s economic and military security.  In this regard, I have tried to do my part to participate in a debate of ideas that is as timely today as it was in 1789.

What is noticeably missing from this ongoing debate is the expression of a Tory point of view.  Only a Tory can claim both to be culturally conservative and to love big government.  This combination of viewpoints, so alien to our modern ears, is unsurprising given that the Tory philosophy was born in England as a defense of the monarchy against republican reformers.  In the United States, we associate Tories with the Loyalists who supported King George, many of whom moved with their families to Canada after the Revolution.  If we remember American Tories at all, it is as aristocrats and persons of privilege who sought to maintain their elite positions within the status quo.

 However, Tories have a distinctive political philosophy.  As the historian Gordon S. Wood noted in his book The Radicalism of the American Revolution (1991), prior to the American Revolution “all government was regarded essentially as the enlisting and mobilizing of the power of private persons to carry out public ends” (p. 82).  True Tories embrace this view to this day, and in Great Britain they esteem the monarchy as a symbol of government power conjoined with a public purpose.  Tories recognize that the great accomplishment of representative democracy in America is to reverse the direction of this flow of power, in order to make government serve the ends of private persons.  However, Tories fear that the benefits of this change in the flow of power are derived at the expense of the common good.

While American conservatism has some of its roots in the Tory movement, it has evolved over the years in a way that glorifies private initiative and that diminishes the value of government.  George Will, who occasionally claims Tory sympathies, once noted disapprovingly that American conservatism “tends complacently to define the public good as whatever results from the unfettered pursuit of private ends.  Hence it tends to treat lasisez-faire economic theory as a substitute for political philosophy and to discount the importance of government.” (George Will, The Morning After (1986)).

 Undoubtedly, the most notable Tory voice in modern American life was the journalist Henry Fairlie (indeed, he may have been the only Tory voice in modern American life).  Over a career that included a column in the Times of London in the 1950s as well as stops at the Washington Post and The New Republic, Fairlie established himself as a unique observer of both British and American politics.  He passed away in 1990.  A collection of his essays, entitled Bite The Hand That Feeds You, was published earlier this year.          

Here is Henry Fairlie’s description of a Tory, from his 1976 essay “In Defense of Big Government”:

 The characteristics of the Tory, which separate him from the conservative, may briefly be summarized: 1) his almost passionate belief in strong central government, which has of course always been the symbolic importance to him of the monarchy; 2) his detestation of ‘capitalism,’ of what Cardinal Newman and T.S. Eliot called ‘ursury,’ of what he himself calls ‘trade’; and 3) his trust in the ultimate good sense of the People, whom he capitalizes in this way, because the People are a real entity to him, beyond social and economic divisions, and whom he believes can be appealed to and relied on, as the final repository of decency in a free nation.  The King and The People, against the barons and the capitalists, is the motto of the Tory.

(Bite The Hand That Feds You, p. 127-128). 

In general, Fairlie’s distrust of unfettered capitalism seems to anticipate the disgust with Wall Street that motivates the Tea Party movement, but this leads him to the conclusion that more government, not less, is necessary.  He wrote, “When the private power — of the barons, of the corporations — is necessarily as great as it is in modern society, it can be checked only by a dynamic assertion of public power” (p. 134).

Fairlie’s writings also identify a strong moral imperative behind big government.  He understands the desire of private citizens to be left alone by their government, but he equates that desire with selfishness.  His essay evokes ”the child of ‘affluence,’ cunningly saying that all he wants is to be left alone to ‘do his own thing,’ and he will leave others alone to do ‘their own things,’ which of course means that he will leave them alone to be poor, to be uneducated, perhaps even to starve” (p. 133).     

It would be interesting to hear Fairlie’s views on Health Care Reform, or the Financial Bailout, or (one smiles in anticipation) Sarah Palin.  Not necessarily because he would be correct, but rather because he would be true to his own instincts and beliefs instead of hewing to some established “party line.”

Henry Fairlie refused to allow himself to be boxed into any formal ideology.  He doesn’t fit into our neat boxes of liberal or conservative.  When he was alive, his column reminded us that there is little in our messy world that fits neatly into the ideological boxes that we construct to hold our reality.  Our nation’s typical left/right dichotomy is as confining as it is predictable.  Ultimately, Fairlie’s peculiar vision of Toryism may only have had himself for an adherent, but that is not necessarily a bad thing.

Fairlie is also memorable for other reasons.  He firmly believed in the indomitable American spirit.  He believed that the greatest quality of Americans was their genuine desire to help those less fortunate than themselves.  Fairlie was also the declared enemy of the smug, the self-satisfied, and of those who think that they have all of the answers.  He opposed such people even when the result was to bite the hand that fed him.  If someone were searching for a personal philosophy, they could do worse than to start with these elements.

 As we prepare to move into the new Law School building, take a moment to consider this particular Tory.  Henry Fairlie was, above all, an individual thinker.  We should all aspire to think for ourselves, no matter where that leads us.  There will be plenty of room for liberals and neo-conservatives, progressives and Tea Party members – and, yes, even Tories– on Tory Hill.

This is the fourth in a series of posts reviewing last term’s criminal cases in the United States Supreme Court and previewing the new term.

Habeas corpus presents the classic federalism problem in criminal law: how can federal courts overturn flawed state-court judgments while maintaining due respect for state sovereignty and the autonomy of state criminal-justice systems?  But federalism issues can also appear in criminal cases that originate in federal court.  In its new term, the Supreme Court has at least two such cases.

First, in United States v. Johnson, the Court will consider whether a battery conviction in Florida state court counts as a violent crime for purposes of the Armed Career Criminal Act, a federal sentencing statute.   (I have posted several times about ACCA in the past year, most recently here.)  Although “battery” normally evokes images of serious violent crime, Florida law defines battery so that it includes any nonconsensual touching, regardless of risk of injury.  For that reason, the Florida Supreme Court has already ruled that battery is not a violent crime for state-law purposes.  Thus, in Johnson, the United States Supreme Court is confronted with a question of whether it should defer to state-court characterizations of state crimes for purposes of implementing a federal statute.

Second, in United States v. Weyrauch, the Court must decide whether a state official can be convicted of honest-services fraud based on a conflict of interest that did not violate state law.  (This is one of three new cases in which the Court will consider various dimensions of the federal crime of honest-services fraud.) 

Normally, we expect each state to define the ethical duties of its own public officials.  This seems a basic attribute of sovereignty.  Thus, the theory of prosecution in Weyrauch — that the defendant violated a uniform federal ethical standard for state officials – strikes me as a rather extraordinary (and, I daresay, unfortunate) federal intrusion into the administration of state government.

Both Johnson and Weyrauch ask the Court to choose between what I have termed elsewhere “national uniformity” (uniform treatment of criminal defendants across the entire federal system) and “local uniformity” (uniform treatment of criminal defendants in state and federal courts within the same state).  Should the Court seek to ensure, as far as possible, that battery convictions are treated the same for ACCA purposes regardless of the state from which they derive?  Or should the Court be more concerned that a Florida battery conviction is treated the same regardless of whether a Florida recidivist is being sentenced in state or federal court?  Should the Court seek to establish uniform national ethical standards for state officials, or should the Court defer to each state’s resolution of the underlying policy questions?

Earlier posts in this series:

• Do the Justices Play Nicely Together?
• Ambiguity Is Ambiguous
• Lenity and Mandatory Minimums

Some people dislike jazz.  To them, the melody of the song gets lost in a blizzard of noise.  Jazz aficionados hear something different.  They are listening to what the musicians do in the spaces in between the notes of the melody.

The United States Constitution creates a positive space for government.  The federal government is delegated specific powers.  The governments of the states retain those powers not delegated to the federal government or otherwise retained by the people.

However, the United States Constitution also creates negative space for government.  What happens when a changing world, changing social values, or new technologies cause the public to demand an expansion of government into spaces that fall in neither the delegated powers of the federal government nor the traditional realm of the states?  Typically in our nation’s history, this has occurred in response to a crisis that implicates a national economic interest or a national security interest, making reliance on the individual state governments for solutions inadequate.  Examples would include the Great Depression and the response to the September 11 attacks.  In these situations, the federal government rushes in to fill the negative space, despite the fact that a strict reading of the Constitution does not provide for the federal authority to do so.

In the controversy surrounding the chartering of the Bank of the United States, shortly after the Constitution was ratified, two of the Framers grappled with this dilemma.  The fact that they came to different conclusions continues to influence the debate over federal power today.   James Madison and Alexander Hamilton agreed that the delegated powers of the federal government should be interpreted broadly, but they differed in their view of whether the Constitution left any negative space for the federal government to expand beyond those powers expressly delegated to it.

Madison felt that the outer limits of federal government power were set by the understanding of the people at the time that the Constitution was ratified.  Those boundaries could not be expanded short of a constitutional amendment.  In contrast, Hamilton seems to have believed that these limits could be loosened or lifted through precipitous action by the federal government, explained and defended to the public, so long as the public demonstrated their approval of the new boundaries.  Hamilton’s conception of sovereignty allowed for the possibility that later generations of Americans might approve of a stronger national government than was originally envisioned, if they were persuaded that the extra authority was merited.

 Hamilton’s proposal to charter a national bank, and his adoption of the principle that even a federal government limited in its ends could employ tremendous discretion to achieve those ends, flowed naturally from his view that the Constitution left the federal government room to grow when acting in response to a truly national need.  Madison believed that the proposed bank was inconsistent with the original assumptions concerning the proper ends for which the newly created federal power would be used.  Madison thought it had been settled at the time of ratification that the federal government lacked the power to charter a national bank.  As a result, Madison came to align himself with the Ant-Federalists in opposition to the bank, and he would eventually articulate the States Rights political philosophy that continues to resonate with many Americans. 

In our constitutional system, the Supreme Court serves as the ultimate arbiter of whether an attempt by the federal government to expand into negative space is permitted.  In his recent book, Packing the Court, historian James MacGregor Burns paints a picture of a Supreme Court that has exercised this role in a reactionary fashion.  That the Court is able to play this role at all is solely the result of the bedrock doctrine of judicial review laid down in Marbury v. Madison.  Burns’ thesis is that this seminal case was wrongly decided.

Burns’ view of American history is sympathetic towards presidents who engage in the type of “transforming leadership” necessary to adapt the nation to new challenges and changing environments.  He criticizes the Supreme Court over the course of our nation’s history for often frustrating presidential attempts at transformative leadership through the illegitimate (in his eyes) vehicle of judicial review.  His book is an indictment of a Supreme Court that serves to further reactionary elements in our society rather than to respond to popular movements for reform (with the exception of the Warren Court, which Burns praises – inconsistently – for exercising judicial review in order to expand the scope of individual rights).

Although Burns views history through the traditional dichotomy of liberalism versus conservatism, we should recognize that the search for negative space is not an ideological issue.  The doctrine of the unitary executive, espoused by many of the leading lawyers in the Bush Administration as the justification for broad executive branch power after September 11, and still embraced by many leading conservative thinkers, is nothing if not a declaration that the Constitution leaves a great deal of negative space for the President to operate in in matters of national security.  In its cases dealing with the Guantanamo Bay detainees thus far, the Supreme Court has not foreclosed the possible existence of an expansive executive power so much as insisted that any unprecedented movement of executive power into spaces left open by the Constitution must come with the assent of congress.

Burns is correct that the Supreme Court has often used judicial review to deny attempts by the federal government to expand beyond the bounds that Madison thought were settled in 1789.  Early in the nineteenth century, Chief Justice John Marshall interpreted the federal sphere quite broadly.  However, later in the Court’s history the justices would rely upon doctrines of federalism to promote a political philosophy where state governments received first claim on the ability to expand into any negative spaces.  As our national economy grew larger and more intertwined, and as the role of the United States as a global superpower required a stronger federal hand in dealing with foreign nations, it became more difficult to argue that state governments could successfully occupy all of these open spaces.  The Great Depression, and two Wolrd Wars, forced the Court to recognize this reality.

In more recent years, the Supreme Court has relied upon theories of interpretation, most notably textualism, as the vehicle for denying the federal government the ability to expand its role beyond delegated bounds.  These theories have the benefit of applying without regard to whether state governments are capable of meeting the same demands that the federal government is seeking to satisfy, and therefore these theories have been more successful than federalism as a means of policing the expansion of the federal sphere in the modern economy.  However, the subjective way in which interpretive theory is inevitably applied has become apparent to all observers of the Court, with the consequence that the Supreme Court’s use of textualism has only served to increase public awareness of the Court’s growing institutional power and also of the ideology of its members.  Persons across the ideological spectrum share a discomfort with these developments.

There are early hints that persons seeking to deny the federal government the negative space in which to grow will next turn to moral philosophy, such as the theory of subsidiarity in the Catholic faith, as a vehicle for policing the federal government.  Whether or not these early efforts will mature into a coherent mode of constitutional interpretation remains to be seen.  If this effort fails, there will doubtless be other arguments advanced by those who seek to deny the existence of negative space in our Constitution.

What is undeniable is that the Constitution of 1789 was not written for a United States that had a complex and integrated national economy and that was a global superpower.  As the President and the Congress seek to navigate in such a world (and indeed, as the general public demands that they do so), some people will see only chaos and a lack of legitimate authority.  Other people will see an attempt to create something out of open spaces.

To call this clause of the Constitution “overlooked” is an understatement.  The authors of the Federalist Papers spent little or no time discussing the meaning of this clause.  The Supreme Court, when asked to interpret this clause, has generally admitted that it doesn’t have the slightest idea what it means—with the consequence that the Court has rendered the clause irrelevant and left it devoid of meaning.  This is a shame because, properly understood, I believe that this clause is one of the most important in the Constitution.

The federal government guarantees every state a Republican form of government.  What does the word “republican” mean?   It certainly does not refer to a specific political party.  Political parties did not even exist in 1789.

Today’s school children are generally taught that the clause is intended to guarantee that state governments use the mechanics of representative democracy over the mechanics of direct democracy.  This interpretation is incorrect.  While the Framers often wrote of the benefits of a political system whereby voters elected representatives who would make important decisions on their behalf, especially in instances where the geographic territory to be governed was large, the Framers never expressed the opinion that the direct exercise of democracy by the people should be prohibited.

Indeed, this incorrect interpretation of the clause is dangerous because it has led some observers to question the constitutionality of state-wide voter initiatives altogether, such as the ones that regularly go before the voters in California.  These types of initiatives may be unwise as a means of using direct democracy to determine the policies of state government.  But the use of state-wide initiatives of this type is certainly constitutional.

So if the “Republican form of government” clause does not prohibit the use of direct democracy as a means of state government, what is its purpose?  Simply stated, the clause prohibits the people of any state in the Union from amending their state constitution in order to adopt a monarchy or an aristocracy.

Recall that, prior to 1789, national sovereignty had always– with few exceptions– been lodged in either a monarchy or an aristocracy.  It was a novel idea to declare in 1776 that sovereignty belonged in the hands of the people.  Never before in human history had a nation of the size of the United States declared its intention to recognize its entire people as the ultimate sovereigns.  However, after the Articles of Confederation were adopted following the Declaration of Independence, the national economy was reduced to a shambles and our young country’s national security was questionable.  By 1789 it was natural to fear that the population in some states might eventually backslide and seek a return to a monarchy as a way of restoring public confidence and preserving order.

What Article IV does, then, is to deny to the people of the states the sovereign power to choose monarchy as a form of government.  This clause forever circumscribes the freedom of the people of a state to choose the way in which they govern themselves.  The denial of state power in this regard is necessary, because leaving the residents of a particular state with the absolute freedom to choose any form of state government would be an infringement upon the sovereignty of the people of the nation as a whole.

In fact, by stating that the federal government will “guarantee” a republican form of government, the Constitution makes it clear that the federal government is granted the power to enforce the prohibition on monarchy by force of arms if necessary.  Article IV makes it clear, even more explicitly than the Supremacy Clause in Article VI does, that the sovereign power of the people as a whole, as expressed through the federal government, is supreme over the sovereignty of individual states.   

If one state were to institute a monarchy, it would destabilize the entire Union of states.  In 1789, monarchies were viewed as inherently militaristic.  Monarchies place the decision of whether to resort to force within the hands of one single individual, where it is not subject to any checks or balances.  For a king, an increase in personal power and an expanded border provide mutually reinforcing temptations for invading your neighbors.

If the residents of one state were to adopt a monarchy as their form of government, neighboring states would feel threatened.  Monarchies require standing armies to maintain the king’s authority, and in order to redress an imbalance in power neighboring states would be forced to follow suit.  An alliance between two state monarchies would inspire neighboring republican states to enter into mutual defense pacts.  Imagine a United States with fences and checkpoints at the borders between the states.

The best interests of the nation as a whole require the residents of each state to cede away a portion of their political sovereignty to the nation: the ability to choose any form of state government that they desire.

This has important implications.  It implies that Lincoln was correct when he declared that the southern states had no right to secede from the Union.  While the text of the Constitution is silent on the right of secession, Article IV is an example of an overall constitutional structure that denies state residents the power to exercise political sovereignty within their own borders in a way that threatens national unity as a whole.  The denial of an absolute state power to secede is no greater a restriction on state sovereignty than the denial of an absolute state power to adopt a monarchy.

Some scholars have argued that Lincoln had to reinterpret the Constitution in order to impose a federal government of all the people that was supreme over the states.  In actuality, Lincoln was merely being faithful to the Constitution’s original design.

This understanding of Article IV Section 4 also implies that the Supreme Court was correct, in U.S. Term Limits v. Thornton, when it ruled that it was unconstitutional for states to amend their constitutions in order to impose term limits on their residents elected to federal office.  The Supreme Court’s majority opinion in that case relies upon a tortured interpretation of the various qualifications clauses of the Constitution, and the majority opinion raises Article IV Section 4 just long enough to dismiss the clause as irrelevant.  However, in the end the Court gets the basic point right by holding that state constitutions cannot impose term limits for federal office.

In his dissent in that case, Justice Thomas asserts that the Constitution’s authority depends on “the consent of the people of each individual State, not the consent of the undifferentiated people of the Nation as a whole.”  Had the majority not overlooked Article IV Section 4, the majority opinion would have had a greater textual basis to rebuke Justice Thomas.  Contrary to Justice Thomas’ assertion, the Constitution does take away from state residents the absolute power to control their own form of state government in cases where the national political structure is implicated.  The sovereign power to make decisions affecting the political structure of the nation as a whole rests with the people of the nation as a whole, not with the people of one state.

The text of the U.S. Constitution contains several clear statements that prohibit the states from frustrating the economic unity of the nation.  Economic protectionism is clearly precluded by the commerce clause, the privileges and immunities clause, and the full faith and credit clause (note that the latter two are also located within Article IV).  The fact that the text of the Constitution is far less clear about the predominance of federal interests when it comes to political unity has been the source of great debate and conflict during our nation’s history.

The debate between centralized power (sovereignty with a federal locus) and decentralized power (sovereignty with a state locus) goes back to the Federalist debate with the Anti-Federalists.  Even Madison and Hamilton themselves possessed contrary views on the matter (Madison generally favored decentralization while Hamilton strongly favored centralized government).  Commenting on the internal inconsistencies within the Federalist Papers on this topic, and the text’s sudden lurches between advocating a strong federal government at one point and then arguing in favor of state power moments later, some scholars have accused the Federalist Papers of reading as if its author was a paranoid schizophrenic.

Is it any wonder, then, that our nation’s history reflects this unresolved attitude toward who holds ultimate sovereignty?  The primacy of the federal political power over state sovereignty has been advanced by the jurisprudence of Justice John Marshall, the Civil War policies of Abraham Lincoln, and the New Deal legislation of Franklin Roosevelt.  The absolute sovereign power of the states to make political choices within their borders has been advanced by Jefferson and Madison in the Kentucky and Virginia Resolutions, by the secessionists during the Civil War, and by the leaders of the States Rights movement in the Twentieth Century.

Article IV Section 4 should remind us that under our Constitution the sovereignty of the people is a national sovereignty.  No state government, and no individual state population, has the power to take actions that threaten the political unity of the United States.  The federal government is superior to the states because it is only through a federal government that a national people can exercise their sovereignty.

No one denies that the Constitution forces the states into an economic union, even when they might prefer state protectionism.  Nonetheless, to this very day, many people still argue in favor of an absolute state sovereignty to decide political matters within their own borders.  By consistently overlooking the “Republican form of government” clause, we obscure the fact that the constitutional text imposes a political union on the states in a way that necessarily places a limit on individual state sovereignty.  By rescuing Article IV Section 4 from obscurity, we can resolve the debate over federal supremacy once and for all.

Subsidiarity tells us that a “higher order” of authority should not do what individuals or a “lesser order” can do for themselves. Thus, the argument might proceed, the federal government should not do what a state goverment could do. Government should not do what voluntary mediating institutions can do.

Conservatives often advance subsidiarity as a justification for limited government and it often is. But it’s not that simple either. 

The reasons are that subsidiarity is not simply a jurisdictional principle but reflects a judgment about — or at least emphasis of a particular perspective on — anthropology. It rests on a set of assumptions about the subjectivity of human persons. It is not only that granting freedom to individuals and the voluntary associations that they form will release human creativity, but that the release of creativity is itself an instrinsic good. True development of the human person requires his or her participation.

This suggests a limit on subsidiarity as a jurisdictional principle strictly defining the role of the state and the spheres of higher and lower levels of government. Catholic social thought also emphasizes solidarity. People are connected to one another and each should be committed to the common good of all. It emphasizes the human dignity of all persons and the duty of charity towards all. Every  individual ought to be able to exercise his or her subjectivity and government (or even larger private institutions) are not the only obstacle.

Sometimes intervention of a higher order may be required to make the exercise of subjectivity possible. This may threaten to mire us in indeterminancy. What do we do when the irresistable force of subsidiarity meets the immovable object of solidarity? 

I think that we can do many things. But it seems to me that some guidance is provided by the notion that policy must make space for human creativity and freedom. Although not every social outcome produced by human freedom is acceptable, it is not for the state to impose its view of the best of all possible worlds. Once it has done what it can (and that may be far from a guarantee) to ensure the conditions for human flourishing, it ought to step back and allow human beings to flourish.

I don’t know that this resolves many of the political disputes we have in the U.S., but perhaps it is a useful way to think about them. 

Cross posted at PrawfsBlawg.

The faculty at Marquette Law School welcomed Professor Marcia McCormick of the Samford University’s Cumberland School of Law to a faculty workshop this past Tuesday.  Professor McCormick, who focuses on the law of federal courts and employment discrimination, among other areas, discussed her new paper on the persistence of the case of Ex Parte Young in the face of the Federalism Revolution of the last two decades or so.

In her presentation, Professor McCormcick described the large number of U.S. Supreme Court decisions in the last twenty-five years that have touched on the relationship between the federal government and the states. In this time, the Court seems to have substantially limited the power of the federal government and expanded that of the states, as many Commerce Clause, Tenth Amendment, and Eleventh Amendment cases suggest.

She also maintained that despite what were seen by many to be revolutionary shifts, two doctrines that provide great power to the federal government seem to have survived so far with little or no change: Congress’ power under the Spending Clause to require states to engage in or refrain from engaging in certain conduct; and the federal courts’ power under Ex Parte Young to hear suits by private parties to force state officials to follow federal law, including laws created under the Spending Clause. The combination of these two doctrines provides for quite a bit of federal power, she argued, and it is the extent of that power which makes the continued survival of the doctrines so surprising.

Professor McCormick then explored the extent of power the federal courts and Congress can exercise over the states through the use of those combined doctrines and suggested some reasons the Court has not removed that power.  In this vein, she argued that it was likely that the Court sees this limited federal power as a necessary check on the states to ensure the supremacy of federal law, to maximize the efficient use of both federal and state power, and to maximize accountability and the rule of law for both the states and federal government.

A lively question and answer session followed Professor McCormick’s talk.   I have it on good authority that Professor McCormick’s favorite culinary adventure involved Kopp’s Custard in Greenfield.

WPRI has now published a study evaluating the probability of such migration. I have not yet carefully examined it, but I continue to believe that such migration (and the Supreme Court precedent that protects it) is a serious obstacle to state efforts to enact some form of universal health care and, for that matter, a variety of other initiatives that states may undertake in their once honored roles as “laboratories for democracy.”

Cross posted at PrawfsBlawg and Shark and Shepherd.

His post takes off from the recent ERISA preemption case of Golden Gate Restaurant Association, in which the Ninth Circuit recently held that a San Francisco ordinance demanding employers provide health benefits is not preempted by ERISA.  This holding is contrary to many of the cases in this area (and critiqued by ERISA luminaries like Ed Zelinsky) and the case is currently being considered for en banc review.

Here’s a taste of Rick’s insights:

San Francisco is now locked in a struggle with business over whether subnational governments can mandate that employers provide their employees with health care benefits. The employers are claiming that ERISA preempts the mandate, and their argument illustrates the insidiously anti-democratic nature of preemption arguments. As a matter of policy, I tend to agree that funding public benefits like health care through mandates on employers is foolish. Such a finance mechanism interferes with the mobility of labor and discourages job creation. Far better, it seems to me, to provide health benefits through general taxes not incident on employment.

But here is where I am a die-hard lover of federalism: As dumb as employer mandates are, centralizing debate over health care through a broad construction of ERISA preemption is even dumber.

Such centralization is an outrage against the democratic process both locally (by suppressing the efforts of those zany San Franciscans) and nationally (by letting Congress off the hook of confronting the relationship between health care and employment). San Francisco hurts no one but itself and its own residents by burdening business and driving away capital to the ‘burbs. The claim that national businesses will suffer some external cost outside San Francisco from disuniform regulation is patently baloney: Any business that operates in any city already must uncontroversially incur the costs of researching and complying with local zoning codes, local taxes and fees, local building codes, local safety regulations, etc. The marginal cost of insuring that one’s local branch complies with the local complying health care law is close to zero . . . .

For those who care about ERISA, why do I claim that preempting San Francisco’s ordinance is madness? The Restaurant Association is essentially making an effects-based preemption argument, asserting that SF’s ordinance effectively requires employers to change their ERISA benefits plans to comply with San Francisco law. The folly of this argument, however, is that it proves too much: Lots of local laws might have effects on employers’ incentives to provide contractual benefits. Medical malpractice lawsuits under state tort law might drive up the cost of insurance, leading the marginal employer to reduce employees’ health care benefits. Local zoning law could — indeed, does — increase housing costs, which increases the relative attractiveness of housing benefits to employers. But no lawyer in their right mind would argue that these state and local laws “relate to” ERISA benefits plan, because these laws’ obligations are not triggered by the existence of ERISA-covered employment benefits . . . .

Any other theory will draw the courts into a theory of preemption that could suck every state and local regulation of business into the maw of ERISA preemption — an outcome utterly unintended by anyone in Congress in the 1970s, when ERISA was enacted. For courts to create such centralization without Congress’ assent is, as I noted above, an outrage against common sense and subnational democracy. As I have argued elsewhere (Against Preemption: How Federalism Can Improve the Federal Legislative Process, 82 N.Y.U. L. Rev. 1 (2007)), ERISA preemption has also absolved Congress of the duty to confront the problem of how health care benefits relate to employment. Preemption, in short, destroys both subnational and national democracy . . . .

Although I have not agreed with Rick on other topics like the manner in which public pensions have contributed to NYC’s fiscal crisis, I think he is right on here.  From a more technical ERISA standpoint, I wrote on the Ninth Circuit opinion back in October:

I am now persuaded that the 9th Circuit’s ruling [in Golden Gate] is consistent with the Travelers precedent from 1995 that unless a law is historically a matter of local concern, there should be a presumption against finding ERISA preemption. It seems to me that courts have read ERISA incorrectly in this regard in past cases.

My epiphany came in writing my new paper on the intersectionality of ERISA preemption and remedial provisions.  In order for many plaintiffs not to be deprived of the remedy that they deserve, the preemption provision must be strictly construed according to the language in Travelers.  This reading will ensure that defendant employers are not able to inappropriately use ERISA as a shield against meaningful health care reform or appropriate types of relief in ERISA cases.

Rick argues for a more limited ERISA preemption doctrine based on federalism principles, and I argue for the same limited doctrine based on the employee-oriented, remedial nature of the statute, but we come out in the same place.  I am with Rick in that I hope the en banc Ninth Circuit understands the compelling arguments that abound to allow local municipalities to democratically decide what responsibilities employers in their jurisdictions have for providing their employees with health care benefits.

My thought is that if we allow federalism to flourish in this context, many jurisdictions will force Congress’s hands to reconsider how to protect benefits for employees under ERISA.

Because they are smaller in size, local governments are more capable of being responsive to the needs of their respective communities because they are more in touch with their constituents.  This leads, in theory, to more responsive and representative policy-making as local government officials make decisions informed by the community’s wants and needs.

In light of these considerations, Matt argues against the tendency of some courts to squelch local initiatives through narrow constructions of home rule powers and liberal invocations of the implied preemption doctrine.

All of this connects nicely to the recent, lively discussion on this Blog of Milwaukee’s ballot initiative mandating paid sick leave for employees.  I take it that Matt would be skeptical of arguments that the Milwaukee law is preempted by state and federal law — at the least, his analysis would suggest some good reasons why a court ought to be slow to find preemption. 

Matt’s article also reminds me of the argument of Dan Kahan and Tracey Meares (which I blogged about here) that federal constitutional limitations should be relaxed so as to permit more creative responses to crime at the local level.  Kahan and Meares are careful to note that their position is premised on the capacity of minority communities — which are the communities most directly affected by crime and policing – to participate effectively in local-level policymaking.  Their concerns regarding the political power (or lack thereof) of affected communities might give one pause regarding recent anti-immigrant initiatives at the local level (which I do not see Matt to be embracing as a model).

For myself, I am quite sympathetic to the localist project.  For instance, I have advocated for more local control over the way the war on drugs is waged (57 Vand. L. Rev. 783).  Thus, I think it is unfortunate that the federal government has attempted to stamp out locally approved and regulated medical marijuana distribution operations in California.  But I also think (in the spirit of Kahan & Meares) that cities that want to be more aggressive about drug enforcement — more checkpoints, drug tests, sniffer dogs, etc. — should have ample room to implement their policy preferences.  (I may not want to live in such a city myself, but that is another matter.)  Likewise, although I did not support the Milwaukee sick leave initiative on the merits, my preference for local autonomy and experimentation leaves me hoping that the courts will provide an opportunity for the initiative to prove its worth.

The Seventh Circuit nonetheless affirmed, determining that, even had the omitted information been included, there would still have been a sufficient showing of probable cause to support issuance of the search warrant.  Lurking in the background of the case, of course, is a legitimate concern about jilted lovers lying to cops about criminal activity in order to harrass their former significant others.  But it seems to me that the police have every incentive to screen these messy cases out of the system as quickly as possible, and little reason (in this context) to withhold key information bearing on credibility when seeking a search warrant.  In any event, the particularities of the Robinson case were such that the withheld information did not seem especially important (e.g., the cop’s affidavit did disclose the existence of another pending criminal charge against Evans).

Although the Seventh Circuit’s resolution of the Fourth Amendment issue seems perfectly reasonable, I find the prosecution of the case a bit troubling.  Robinson nicely illustrates how the combination of an expansively defined federal crime (felon in possession) and a cozy relationship between local police and federal prosecutors can result in the conversion of a routine domestic disturbance into a federal conviction, which typically entails a much longer sentence than a state conviction.  (These cases are especially troubling when they trigger the fifteen-year mandatory minimum of the Armed Career Criminal Act, which does not seem to have been applied to Robinson.)  Once upon a time, there were clearer lines demarcating what were federal cases (typically white-collar stuff, organized crime, and crime with a real interstate or international component to it) and what were state cases (typically public disorder offenses, violent crime, and routine property offenses).  As is indicated by the phrase, “Don’t make a federal case out of it,” there was a sense that federal prosecution was reserved for only the most serious offenses.  As we have gotten away from this tradition and entered an era of far more complex federal-state law enforcement relationships — a trend I have explored in some of my scholarship — I fear there have been significant costs in terms of public accountability and perceptions of arbitrariness.

This is the second in what will be an ongoing series of weekend posts reviewing new Seventh Circuit opinions in criminal cases.

These short papers touch on an important, longstanding debate in federalism theory: whether each field of social regulation ought to be handled exclusively at a particular level of government (federal, state, or local), or whether shared responsibilities ought to be the norm.  The exclusivity model was dominant through much of this nation’s history, but was almost entirely supplanted in the middle decades of the last century by a cooperative federalism model.  As someone who worries a lot about transparency and accountability in government, I confess to some unease about the opaque, complex federal-state-local arrangements that now predominate in nearly every major field of public policy (environmental protection, crime, health care, education, housing, transportation, etc.).  On the other hand, if the mechanisms of democratic accountability do not operate well, the exclusivity model can lend itself to agency capture, bureaucratic inertia, and regulatory stagnation–which is (I take it) how Paul would characterize the present state of federal labor and employment law.