Politically Incorrect Guide To The Constitution (Politically Incorrect Guides) (26 page)

TR and Taft Go Trust-Busting

The Sherman Antitrust Act was utilized most vigorously in the early 1900s by Presidents Theodore
Roosevelt and William Taft, who crusaded against such "trusts" as the Northern Securities Company, Standard Oil, and the American Tobacco Company-often with deleterious results.

The Sherman Act banned attempted monopolies or combinations of
companies "in restraint of trade." But in the course of a decade, the Court
differed over how the act should be enforced. In U.S. v. E.C. Knight Co.
(1895), the Court allowed a corporation to acquire 98 percent of the
American sugar industry's manufacturing sector. According to the Court,
the Sherman Act did not cover purely intrastate activities such as refining.

Justice John Marshall Harlan dissented, and just nine years later he
won a majority to his dissenting approach. The 1904 case Northern Securities Co. v. United States turned on the question of whether a company's
ownership of three railroads amounted to an "unreasonable restraint of
trade." By a five to four vote, the Court said yes.

Not only is "reasonableness" an inconsistent non-standard for businesses trying to keep within the "law," but what exactly are the grounds
for handing federal judges authority to define "reasonable" business practices? To win an appointment to a federal court takes three qualifications:
first, a law degree; second, the favor of a president; and third, the consent
of the Senate. None of these three qualifications is any guarantee of business expertise.

In fact, in the Sherman Act, Congress unconstitutionally delegated its
legislative powers to the courts. It also gave the courts de facto power to
violate the Fifth Amendment due process rights of business owners. They
could now be penalized for "violating" vague and indefinite laws regarding "reasonable" business practices. Nevertheless, the Court accepted the
delegation, and so the Sherman Act is still on the books.

In 1895, the Court considered whether the income tax statute of 1894 was
constitutional. The law levied a tax of 2 percent on all annual incomes over $4,000. Like the Sherman Act, the income tax had been adopted in
a spasm of class-based animus.

The Supreme Court, however, ruled in Pollock v. Farmers' Loan and
Trust Co. (known as the Income Tax Case) (1895) that Congress had no
constitutional authority to impose such a
tax. The Court split violently over the
Income Tax Case. In his concurring opinion,
Justice Stephen J. Field warned, "The present assault upon capital is but the beginning.
It will be but the stepping-stone to others,
larger and more sweeping, till our political
contests will become a war of the poor
against the rich; a war constantly growing in
intensity and bitterness." While the majority
was right that the income tax was unconstitutional because it was a direct tax not
apportioned equally among the states,
Field's argument was more philosophical,
even political, than legal. Soon enough, the
Court would follow Field's lead in assuming the role of defender of capital against state-level legislative majorities. This itself was unconstitutional, given the Constitution's division of powers between the state and
federal governments.

In Lochner v. New York (1905), the Court went much further. In 1895,
New York State had passed legislation to regulate working conditions in
bakeries (among other things, bakery employees were limited to ten-hour
work days and sixty-hour work weeks). Joseph Lochner, a baker who had
been fined for overworking his employees, called the legislation unreasonable and invoked the Due Process Clause of the Fourteenth Amendment.

Block That Trust!

Since its inception in 1922, the National
Football League has been exempt from
the Sherman Antitrust Act. The NFL is
allowed to operate its franchises (i.e., the
teams) not as individual businesses but as
a single entity, with each team getting an
equal share of NFL-generated revenue.

The Court perhaps predictably agreed with Lochner that the statute violated the Due Process Clause. Justice Rufus W. Peckham, author of the
Court majority's opinion in Allgeyer v. Louisiana, believed that the Fourteenth Amendment established a generalized liberty of contract-including the right to labor unlimited hours per week in a hot, stuffy bakery. The
issue, then, was, "Is this a fair, reasonable, and appropriate exercise of the
police power of the state, or is it an unreasonable, unnecessary, and arbitrary interference with the right of the individual to his personal liberty,
or to enter into those contracts in relation to labor which may seem to him
appropriate or necessary for the support of himself and his family?"

Justice Peckham's answer to this question for the Court was, "The
employee may desire to earn the extra money which would arise from his
working more than the prescribed time, but this statute forbids the
employer from permitting the employee to earn it."

We may (I do) believe the statute at issue in Lochner, and other legislation like it, to have been unwise. We also may consider it no coincidence that one of the majority justices in this case was the son of a bakery
owner. Still, that does not change the fact that the Constitution left legislation in this area entirely to the states. The Fourteenth Amendment's
Due Process Clause was not intended to give a majority of Supreme Court
justices veto power over all laws they did not like. Peckham's insistence
that "this is not a question of substituting the judgment of the court for
that of the legislature" shows that he recognized the obvious objection to
the Court's ruling, but he proceeded to substitute the Court's judgment
for the legislature's anyway.

In 1908 (Adair v. United States) and 1915 (Coppage v. Kansas), the
Court invoked "liberty of contract" so that employers could prohibit
workers from joining labor unions, despite state laws to the contrary. The
Court also pointed to "liberty of contract" to knock down minimum-wage
legislation for women and children in Adkins v. Children's Hospital
(1923). Congress had passed the legislation for the District of Columbia (for which Congress acts as a sort of state government). The Court held
that because the Nineteenth Amendment now guaranteed women the
vote, special legal protections for women were no longer necessary.

The Court even become involved in theater ticket prices in Tyson tr
Bro.-United Theatre Ticket Offices v. Banton (1927), in which it invoked
"liberty of contract" to strike down a state statute on theater ticket pricing.

States had regulated economic activity since colonial days in ways that
the Court now deemed "unconstitutional." Legislatures that ratified the
Fourteenth Amendment did not intend for the Supreme Court to sit in
judgment on theater ticket prices. Nor did they intend to surrender their
Tenth Amendment rights to govern themselves. Yet here was the
Supreme Court using its own "liberty of contract" doctrine to judge the
economic regulations of the states.

In the twentieth century, the Court's appetite for such power would
only grow.

upreme Court justices soon found another way to justify imposing their personal preferences on "constitutional law": they
reached for trendy sociological studies and gave them equal or
greater weight than the actual words of the Constitution.

Perhaps the most famous example of this in the early twentieth century was in the case of Muller v. Oregon (1908). The question was whether
Oregon could limit women's working hours (in order to protect their
health). The counsel for Oregon was future Supreme Court justice Louis
D. Brandeis, who presented a wide-ranging brief John Marshall would
have loved. He argued that there was a correlation between the hours
women worked and their health, which justified Oregon's legislation
restricting the number of hours women could work. The remarkable thing
about Brandeis's brief was that it was nearly devoid of citations to precedent, or of any legal argument at all; its argument was sociological, not
constitutional or legal. And yet the Court was persuaded. Even though it
had struck down New York's law restricting working hours for bakers, it
upheld Oregon's law limiting working hours for women. Brandeis took
advantage of the fact that the Court had lost all sense of the distinction
between a court's function and a legislature's, and that it would rule in
favor of whichever policy prescription it thought best.

Guess what?

-40 The Supreme Court
used foreign law to
decide that the
federal government could
conscript men into
the military.

- Americas
constitutional
traditions impeded
the socialist
doctrines that
swept most other
countries in the
1930s.

- Before FDR
threatened the
Supreme Court, it
generally ruled
against the state's
economic
legislation.

In 1917 the Court upheld legislation on maximum working hours for
manufacturing employees in Bunting v. Oregon. Oregon's counsel presented another sociological brief, this one showing that employees' health
was affected by the hours they worked. The Court, mesmerized by this
data, upheld the legislation by a narrow majority.

The Court's holdings in Muller and Bunting did conflict with the general "liberty of contract" trend. They can be understood as representing
an older and more significant tendency of the Supreme Court, however:
the tendency to act as the nation's supreme legislative chamber, overruling state legislatures and Congress. What was new was the growing conviction among politicians, journalists, lawyers, and academics that the
Court was right to impose its will because the Constitution itself was outmoded and in need of replacement.

This trend gained strength when Woodrow Wilson was elected president in 1912. Wilson, a political scientist, had long argued that America
should move away from the Constitution's federal, three-branch system
to something closer to the British model. The Constitution, Wilson said,
was simply too inefficient; such cumbersome mechanisms as bicameralism and the
presidential veto too often thwarted the popular will, to the detriment of the American
public.