The Federalism and Separation of
Powers Practice Group,
Good afternoon and welcome. My name is Alex Azar. I’m the Vice Chairman for Programs for the Federalism and Separation of Powers Practice Group.
During the past decade, we have witnessed a remarkable revival in concern for federalism in the corridors of power here in Washington. The Supreme Court has already invalidated eight Congressional statutes on federalism grounds, and in this term, it is considering challenges to three more. And Congress, though responsible for passing these invalidated laws, has also joined with the Court on occasi on to limit federal power. For example, it has restricted federal habeas review of state court convictions and imposed limits on federal court control of state prisons. And currently pending before Congress is the Federalism Accountability Act of 1999, which has been introduced by one of our guests, Senator Fred Thompson. That legislation would reshape the nature of federal preemption of state laws.
The questions for today are: What are the prospects that this federalism will continue? Will this concern and revival of federalism continue into the 21st century? What constituencies support and oppose restrictions on the scope of the national authority? What is the purpose of federalism? Is it respect for state sovereignty? Is it competition among varying systems of regulation? Or is it obedience to Constitutional forms? Do the recent Supreme Court decisions and Congressional actions reflect a coherent and articulable vision of the scope and limitations of federal and national power? What is the role of the judiciary in policing the federal/state divide?
Now, as I was reminded by many of my friends today, you are not paying to hear my views on federalism, especially not with this distinguished panel.
Dr. Michael Greve is the co-founder and executive director of the Center for Individual Rights, and the author of Real Federalism: Why it Matters; How it Could Happen, which I commend to all of you if you have not read it.
Walter Dellinger is a partner at the D.C. office of O’Melveny and Myers, and remains the Douglas Max Professor of Law at Duke University. Mr. Dellinger served as the head of the Office of Legal Counsel and acting Solicitor General in the Clinton Administration during October Term 1996. As acting Solicitor General, Mr. Dellinger argued the Printz and City of Boerne cases, two of the major federalism decisions we may talk about today.
Judge Frank Easterbrook is a judge on the U.S. Court of Appeals for the Seventh Circuit and a senior lecturer at the University of Chicago Law School. He previously served as Deputy Solicitor General of the United States.
Senator Fred Thompson is the senior senator from Tennessee. After only three years in the Senate, he was named chairman of the Government Affairs Committee. In the Senate, he has been a keen advocate of federalism and a leading proponent of limited national government, even where he had to oppose his own party leadership and the Republican platform.
Gentlemen, thank you. I’ll now turn the podium over to Dr. Greve.
Federalism invests two separate governments with jurisdiction over the same territory and the same citizens. When you encounter such a strange construct, you want to ask yourself, why would anyone do this? You find the beginning of an answer in Federalist Number 51: One must first enable the government to control the governed and in the next place, oblige government to control itself. If you want to control the governed, one sovereign is quite enough, thank you much. So federalism can only be intended - and is in fact intended - as a constraint on government.
To the founders, government was a monopoly problem. The way to deal with it is to limit the central sovereign’s authority to a sphere of enumerated powers and in the areas beyond Congress’s purview, to force the states to compete for their citizens’ business, labor, capital, and affection.
I’ll make three preliminary points about this real, competitive federalism, before I get to the task of feeding you red meat, which is what Alex asked me to do. (Laughter.)
First, the linchpin and the be-all and end-all of real, competitive federalism is the doctrine of enumerated powers. Without that doctrine, Congress will suck everything into its impetuous vortex. It will simply trump state competition with uniform central rules because there is always somebody to demand that it do so.
Second: Real, competitive federalism, like it or not, depends on protection by the Supreme Court, because there is nobody else around. Let Congress do the job, and there goes federalism. Let the states do the job, and you no longer have a country. When it comes to the structural constraints of the Constitution, the courts are it.
Third: The Supreme Court can’t guard federalism on its own and against the country and its dominant elites. That’s the lesson the Court learned in 1937. The Court really needs friends with real political clout.
Federalism’s great weakness is that once the enumerated powers doctrine has collapsed, as it has, federalism has virtually no friends and a whole lot of powerful enemies. I have developed that point (and how to get around it) in the book Alex mentioned. Today, I want to focus on the role of the states, and to denounce the states as real federalism’s real enemies. I have four reasons for this focus.
First, my organization is handling United States v. Morrison, which the Supreme Court will decide later this year. At stake in that case is a provision of the federal Violence Against Women Act (VAWA), which extends a federal tort remedy to the victims of gender-based violence. Morrison is the first, clean enumerated powers case - the first clean commerce clause case since Lopez, the first clean case since City of Boerne about Section 5 of the 14th Amendment.
VAWA’s civil remedies provision is based on the notion that the state justice systems are too sexist and misogynous to provide justice for battered women. Now, whose side do you think the states and their chief law enforcers are on? Well, 31 state AG’s are against. One is for us, Bill Pryor, bless his heart. (Applause.) Eighteen of these characters are still in hiding. I’m hopping mad at the 31, and I’m going to let them have it. (Laughter.)
Second: There’s no governor or state AG on this panel to fight back. I harbor a lot of deep, dark thoughts about the United States Senate, the SG’s office, and the Seventh Circuit, but I will keep those thoughts to myself. (Laughter.)
Third: Many of my conservative friends are terribly sentimental about the virtues of state government. I’m here to implore you: get over it. (Laughter.) For the most part, the founders did not want to empower the states; they wanted to discipline them, and I think that’s the task at hand.
Fourth: With one exception - tonight’s banquet speaker (Justice Clarence Thomas) - the Supreme Court thinks of the states, and to some extent of local governments, as a constituency for federalism. Almost all of the precedents Alex alluded to deal with the power of states qua state governments, not with enumerated powers. I think that focus is understandable. But it’s also greatly mistaken, and I’ll tell you why.
The states are in fact in favor of federalism - of a sort. Witness the support for devolution, the fight over unfunded mandates, and an endless stream of 10th and 11th Amendment cases. But the federalism they want isn’t competitive federalism. It’s what the antitrust lawyers among you will recognize as a horizontal-vertical conspiracy.
There are two default positions for the states on federalism. They don’t always govern all states on all issues. They never govern Bill Pryor, but he’s a traitor to his class. (Laughter.) The positions prevail often enough to establish the general pattern and trend.
The first default position is “give us more money and leave us alone.” The governor’s nightmare is the unfunded mandate. Their wet dream is not no mandate; it’s the funded non-mandate. (Laughter and applause.) This is called a block grant. (Laughter.)
Consider welfare reform. Pursuant to the states’ explicit demand, we’ve now devolutionized the spending and implementation side. We haven’t devolutionized the revenue side because the dollars still come from and are raised by Washington. And that’s very weird. If we say that welfare is a state responsibility, why don’t the states raise the money?
Suppose you proposed that. What would John Engler or Tommy Thompson say? They would tell you to get lost.
You don’t have to speculate about that. The Reagan Administration tried this in 1983, and it failed precisely because the states were dead-set against any such system for two reasons. First, the incoming dollars are very highly visible. The fact that those dollars came from the state’s citizens, went to Washington, spent a very expensive night on the town and only then went back (laughter) - that, you don’t see. The governors will take this deal any day. Second, federal dollars constrain state competition and transfer political responsibility. Without federal revenues, the states would have to tax themselves, and they’d have to make tradeoffs among interest groups. If they don’t get the tradeoffs right, their productive citizens walk. No way the states will expose themselves to that kind of competition.
The states’ second default norm is to nationalize the entire economy. Let the feds regulate every mud puddle, every toilet tank, every piece of machinery.
There are two provisos. First, the states want to exempt themselves from these regulations under extravagant interpretations of the 10th and 11th Amendments. The states have already had their way in that regard with the minimum wage. They will have their way with the ADEA. The Family and Medical Leave Act is next. Of course, the states don’t want to repeal those entitlement statutes altogether, for the reasons already mentioned: they would then have to experiment with their state version of an ADEA or minimum wage. They’d have to bargain and legislate under competitive conditions. So the states say: exempt us from the rules that apply to all ordinary citizens because we are the states.
The second proviso is no federal preemption. The states want federal rules that preclude their competitors from competing by offering less redistributive packages, but they don’t want to be precluded from providing more redistributive services which, for one reason or another, they want to or may be able to provide, (often because they have found a way to loot neighboring states). Regulatory ceilings on state experiments are the only context where preemption ever arises, and that’s why the states usually dislike preemption. They want to be laboratories of democracy, all right, but only in the sense of experimenting with collectivist schemes. You ask the average governor, what’s your idea of federalism, and he’ll say Internet taxation and raiding tobacco firms. That’s not a joke. At least, I don’t think it’s funny. (Laughter.)
I don’t mean to say that states are evil (only some of them are) but for the most part, they’re rational. Economic competitors pay lip service to competition, but what they actually want, most of the time, is a cartel. The same is true of the states. The states just have an easier time of running a cartel because there are no new market entrants that could contest the markets, and because the agency that could prohibit the cartel, namely the Congress, turns out to be a co-conspirator.
I’m back to a point made earlier. Only the Supreme Court can stop this gamesmanship by enforcing firm enumerated powers limits.
The right result in U.S. v. Morrison later this year doesn’t get you there, but it’s a huge step in the right direction. Conversely, you let that case go wrong, and the Court’s entire agenda of a piecemeal federalist revival will come to a crashing halt. I think that the Court will recognize that, and that’s one of the reasons why I’m very optimistic that we’ll get a majority of votes.
My real concern lies elsewhere: once the Court gets it right, the Violence Against Women Act will go back to Congress for a thinly-disguised legislative override, just as Lopez was promptly overturned, in effect, by Congress. In that body, on that occasion, I doubt we’ll get a majority. In fact, I’ll be pleasantly surprised if we get one vote.
I’d like to imagine the future by remembering the past. And to use the principles of the past two centuries to look forward to the subject we are to discuss - the 21st Century and federalism - I’ll talk between the lines about a paradox: that modern conservatives seek to protect property rights and economic liberty through the devolution of power to the states.
Property rights and economic liberty were viewed by the Federalist framers of the Constitution as best protected not through states’ rights, but through the creation of an extended national republic. In the summer of 1787, Philadelphia was the scene of a nationalist triumph. And it was a triumph of those who saw in America an end of feudalism, an end to government overreaching, an end to redistribution. I will try to make that case in but a few minutes.
For the longest part of our history - for the first 150 years, from 1787 to 1937 - it was clearly true that the national government, the judges created by that extended republic, was a bulwark against excessive regulation and schemes of redistribution, seen most pointedly as national judges appointed by Presidents Harding, Coolidge and Hoover stood up against redistributive and excessive regulatory schemes in the states. For the last 50 years, the story has been more complex, but rights to property and freedom from government regulation are still best found in a strong national government to a surprisingly large degree.
Charles Fried, with whom I have worked recently on important projects, writes in his wonderful book, Order and Law: Arguing the Reagan Revolution, about how he came to the Reagan revolution as someone who had been a refugee from Czechoslovakia, whose family had come here and sought to escape from totalitarian regimes, from the highly-regulated economy, from the constant redistribution of wealth, leading to lower wealth for all. And early in his time as the Solicitor General, he saw an opportunity to file a brief on behalf of the United States in a small case to take a stand against state regulation tying down economic actors, as Gulliver was tied down by Lilliputians. He saw the ability to argue for federal preemption from this kind of excessive state regulation, the heart and soul of what he thought to be the Reagan revolution.
He was encountered by what he describes as the “federalism police” down the hall on the 5th floor - Charles Cooper, Bradford Reynolds - who had another view of the vision of the Reagan revolution, as one of states’ rights, not about national preemption. There ensued a battle between the states’ rights view and the free market, free enterprise, property rights view, as to which was the soul of the Reagan revolution when those two were in conflict.
In this particular instance, it was played out by Attorney General Meese, who sided with the side of federalism and repudiated Charles Fried’s brief that sought to articulate the views of free markets. But it does occur to me that the framers, particularly those in whose name the Federalist Society was founded, would have wound up on Solicitor General Fried’s side of that debate, and not with Assistant Attorney General Cooper.
But let me begin quickly at the beginning. On July 5, 1787, the Convention returned to Philadelphia from its only break of the summer, only 11 years after July 4, 1776. They had fought the war more as allies than as a union. They did not even have uniform uniforms. They had been more trading rivals than partners. They had come together reluctantly. John Adams had written home to the remarkable Abigail at that earlier convention in 1776: “We gather together, all strangers, not acquainted with each other’s ideas, views, designs. We are therefore jealous of each other, fearful, timid, skittish.”
They saw themselves defending long histories of colonial government which had been increasingly self-governed over the many decades before 1776. And, indeed, the Convention threatened to break apart. A convention that began to create a new Constitution, jumping beyond its mandate to propose revisions in the existing articles, had met on May 25, but by July 4, by the time of that break, the Convention threatened to break apart. They took one break, they came back, and on the 5th of July, Governor Morris of Pennsylvania addressed his colleagues and said, according to Madison’s account:
“He came here as a representative of America. He flattered himself: He came here in some degree as a representative of a whole human race, for the whole human race will be affected by the proceedings of this Convention. He wished gentlemen to extend their views beyond the present moment of time, beyond the narrow limits of time and place in which they derived their political origin. This country must be united. If persuasion does not unite it, the sword will. The scenes of horror attending civil commotion cannot be described, and the conclusion of them will be worse than the term of their continuance. The stronger party will make traitors of the weaker, and the gallows and the halter will finish the work of the sword.”
That’s an extraordinary, apocalyptic vision, yet none of the delegates at Philadelphia said that was too extreme a view. Indeed, who knew what lay next? In France, the guillotine would finish the work of the sword, and the stronger party would make traitors of the weaker.
As the framers gathered in Philadelphia, a rumor suffused the city that Rhode Island, the most populous of the state legislatures, was considering a bill calling for the equal redistribution of all wealth every 13th year. As Gordon Wood once put it, if you ask about the relationship of this federal Constitution to democracy, you have to understand that democracy was the problem to which the Constitutional Convention was called to frame a response. The problem of populist democracies in the state legislatures was part of the Convention debate as early as May 31. Randolph of Virginia observed that the general object of the Convention was to provide a cure for the evils under which the states labored - that in tracing these evils to their origin, every man had found it in the turbulence and follies of democracies.
In these populist state democracies - governments close to the people, with one House, appointed Governors, one year terms, annual elections, rotation, and instruction - a populist movement could sweep through the state, including the elected judges. All of this was part of the vision, the states’ rights vision, of a different conception of Government, and led to paper money, debtor relief, the abolition of rights of property. That is why the framers came together in Philadelphia - to try to find a national solution to the diseases most incident to Government.
We find the conception that was articulated in the 10th Federalist, familiar to all of us, where Madison says it is in the extended national republic that there is security of property. Listen to Madison arguing for ratification of this national Constitution: “The smaller the society, the fewer the distinct parties; the fewer the distinct parties and interests, the more frequent will a majority be found of the same party.” Extend the sphere to the national continent, he means, and you take in a greater variety of parties and interests and make it less probable that a majority of the whole will have a common motive to invade the rights of other citizens. He saw property rights and rights of religious freedom indistinguishable.
“The influence of factious leaders may kindle a flame within their particular states,” writes Madison, “but will be unlikely to spread a general conflagration to other states. A religious sect may degenerate into a political faction in part of the confederacy, but the variety of sects across the face of the nation must secure against any danger from that source. A rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project will be less apt to pervade the whole body of the union than a particular member of the states.”
Hamilton saw that the protection of finance depended upon a national commercial republic. In our day we have seen in legislation I have testified in favor of to put in federal courts class actions of real national import, echoes of what the framers sought to achieve. For those of you who were not here at lunch, Tom Gottschalk of General Motors sounded the same theme - states as laboratories of democracy. He said that, from the standpoint of business, states may be laboratories, but we are often the laboratory animals on which the experiments are being conducted. (Laughter.) That is the sense in which I see Reno v. Condon. It is the states that are requiring citizens to be licensed in order to drive, and conditioning that on giving out your name and address to any stalker with $3.50. It is the national legislation that says: leave that privacy interest alone.
So I think that, in the displacement of multifarious state legislation, strong protections of property require a strong national government. Think of what we have achieved. I will have many opportunities I think in the ensuing question and answer period to elaborate more particularly on these themes, and particularly the theme that the political branches of Government have come into disfavor with this Supreme Court - partly through their own fault, but partly because the Supreme Court evidences a hostility to the national Government, and not so much out of deference to the states. Consider, after all, that the Court does not give much regard to the states’ interests when Congress is not involved.
But before we abandon the Madisonian, Hamiltonian vision of what a national Government can accomplish or why this great continent from the Atlantic to the Pacific, from the St. Croix to the Gulf of Mexico, needed a national Government to meet its needs, think what this national Government, however much in ill repute it may be today, has accomplished in the last 200 years. Quite simply, it led to the settling of this great continent. It mobilized 3 million men in arms to put down the rebellion and secure the union. It took on and responded to the most devastating economic Depression in modern times. It mobilized the vast resources to help turn back the tide of fascism in Europe. And it won the Cold War. That is no small list of achievements for any Government, and I hope we will continue to realize that there is a legitimate role for national power to help secure what one of our forebears called America: a great and mighty empire ’til time shall be no more.
JUDGE EASTERBROOK: A great weight was lifted from my shoulders this morning. Ted Olson freed me from my secret oath of fealty to do the Society's bidding --
JUDGE EASTERBROOK: -- and told me to do what's right. Then Bob Bork stood up and said that what judges should do is law, and not policy. We should enforce the rule of law and not make it all up. Now that has always been my view, and now that at last I am free to say that --
JUDGE EASTERBROOK: -- I must confess that this has big implications for our panel, for the 10th Amendment is empty, and enumerated powers are sweeping. In fact, there's even a clause in the Constitution called the "sweeping clause."
I want to talk about two judicial mileposts that are often seen as in irreconcilable conflict -- the Garcia case, which says that the Fair Labor Standards Act applies to the states, and the Prince case, which says that Congress can't commandeer state officers to do even really good things.
People want the Court to go one way or the other. This perception of conflict is generally resolved in most people's debates by turning to the major issues of political theory. What is the role of the states? May the national Government legislate directly against the states? How far may Congress burden states? These are terribly interesting questions. They are interesting for political theorists. They are interesting for ongoing legislation, and they are interesting at the outset of a Republic. But in our Republic, so far as the Constitution is concerned, these questions were largely resolved.
We largely chose a model of national Government acting directly on the people rather than on the states, but not completely. The supremacy clause operates directly on state officials. The election clause operates directly on state officials. Of course, until the 16th Amendment any national income taxes were apportioned through the states rather than laid directly on the people.
The European Union chose to do things 180 degrees differently from this. The directives of the European Commission are issued to the member states, and not to the people. They can't be enforced directly against the people. There, the theory is that since the member states signed the Maastricht Treaty all the directives can be issued only against the signators, i.e. the people who were parties to the contract.
These are great issues and the choice, the fundamentally different choice made between the United States and the European Union doubtless has great consequences in both theory and practice. But I don't want to play the theory game. We played this game largely in this nation in 1787, and again in 1791, and yet again in 1868. Today the theory game can be played in an all-or-none fashion only in the academy. For a judge, well, especially for a judge, the question is not the best role of states but how a court justifies interfering with political decisions made by elected officials. For our main Constitutional decision in representative democracy was to create a division, an extremely unruly division, between state and federal governments, among branches, a smearing of powers in a way that Madison thought would protect us against such things as a rage for paper money. I don't know whether you have looked at your wallets recently --
JUDGE EASTERBROOK: -- but beliefs about what a structure will do are often imperfect predictions about what will happen. But the main decision was to blur and smear these powers. It was not in any way to transfer the fundamental decision-making role to critters like me, who, whatever you may think of my views, you can't get rid of, right? I am not resigning on January 20th, 2001, right?
JUDGE EASTERBROOK: And that means that judges are no more authorized to invent rules of federalism than to invent rights of criminal suspects, or to protect judges' favorite sexual activities in the name of privacy.
JUDGE EASTERBROOK: So what is it that is actually in the Constitution? Well, there's no federalism clause. What speaks cleanest, the supremacy clause, actually binds state officers directly to federal law. As the Supreme Court said back at a time when it was a little closer to the beginning -- 1876, to be exact -- the laws of the United States are the laws in the states. There is not a separate sovereign but multiple sources of legitimate legal authority. That was the nature of our structure in 1787.
Those people who want to rely, as the title of this panel suggests, on the 10th Amendment, would do well to read it. In fact, I brought it with me. It is very short. It says, "The powers not delegated to the United States by the Constitution nor prohibited to it by the states are reserved to the states, respectively, or to the people."
Now there are two points to be made about that language. The first is that it doesn't tell you what powers were delegated. If a power got delegated the 10th Amendment certainly did not de-delegate it. One has to figure out what powers are delegated, but you can't figure that out by reading the 10th Amendment over and over.
JUDGE EASTERBROOK: Second, the 10th Amendment does not privilege states. If powers aren't delegated, then the national legislature can't act. The states and the people are protected against the exercise of non-delegated powers. But if the powers are delegated, there is no basis in the 10th Amendment for an argument that states are protected but the people aren't. If the powers are there, they are there. If they are not, they're not. And the 10th Amendment is terribly important to the extent it reminds us we had better be sure the powers are there, but it doesn't suggest that there is a big difference, or indeed any difference, between the states and the people.
No less a friend of federalism than Justice Rehnquist made this point in the Fry case, a case that holds that wage and price controls can properly apply to the states. The only question, Justice Rehnquist said, is not what the 10th Amendment says, but whether Congress has the delegated power to impose wage and price controls, and likewise in National League of Cities. I have gotten kind of tired of lawyers filing briefs saying, well, the 10th Amendment, recognized in National League of Cities -- and then insert something after that.
If you actually read Justice Rehnquist's National League of Cities case, he says this has nothing to do with the 10th Amendment.
JUDGE EASTERBROOK: The question is, was the power delegated to Congress in the commerce clause to regulate essential internal operations of the states, and the Court in National League of Cities answered that question "no." It is the right question to ask. Is there a delegated power? Don’t worry about phantom limits. Let's go look for the delegation.
But as soon as we start to look for the delegation, or as soon as critters like me start to look for the delegation, there is a second big problem. It is not simply finding delegations. It is that there is no judicial review clause in the Constitution. Judicial review was inferred in Marbury from the quality of the Constitution as law. If the judge can't point to a legal rule, the Court has no business upsetting political decisions. Now that is a principle with which this society ought to be very comfortable, so let's start looking for a rule in the commerce clause, for example.
Well, there is a rule. If there isn't any interstate commerce involved, there is no delegated power. Okay. But the commerce clause doesn't say there has to be a lot of interstate commerce or important interstate commerce, and it certainly doesn't say that the rule Congress makes about interstate commerce has to be a wise one. There just has to be some interstate commerce.
If the rule about interstate commerce had to be a wise one, I could free up a lot of shelf space in my chambers --
JUDGE EASTERBROOK: Do you realize how much space the U.S. Code takes up? Most of that would just go right out, if wisdom were actually important. What matters is that there be some [interstate commerce], and after there is some, the power is in the political branches
What we have experienced in this country, what leads to panels like this, what leads to statutes like the Violence Against Women Act, is that as the cost of transportation and communication goes down, there is much more interstate movement as a percentage of all commerce. And it is much more likely that any intrastate activity will have an effect someplace on what moves across state borders.
You can't pick up the phone these days without having your phone call go from your state to somebody else's state to a geosynchronous satellite back to a third state and passed on to a fourth state. And indeed that might happen if you just pick up your phone and call your next door neighbor.
Once one says that has happened it seems to me beyond the power of our courts to say, well, we are going to start insisting that it [interstate commerce] be really big or really important or really wise. We have been down this road before, and I want to come back to something that Chief Justice Marshall said in a different case, the McCullough case. Remember that one? It says that Congress can establish a Bank of the United States. Well, there isn't a Bank of the United States clause, is there? But there is, of course, the sweeping clause, the necessary and proper clause. And if Chief Justice Marshall had been a different person and had had perhaps a larger view of the role of judges in society, he would have said, well, you know, necessary -- necessary means it has really got to be vital and proper. Well, that is just an invitation to the judiciary to decide what is proper.
What he said instead is, yeah, it's an invitation all right, but we have a fundamental choice to make. The choice is this -- are the basic decisions of Government going to be made by judges or by the people you elect? If judges insist that the propriety of legislation, or the necessity of it, be demonstrated to them, then they are really in charge. And you are not going to like that because you don't get to throw us out of office every two years or every four years or every six years. You know, it takes murder to get rid of a federal judge.
JUDGE EASTERBROOK: So the fundamental choice, and this is right at the beginning of the Republic, is that questions of prudence and wisdom in the use of granted powers are not questions about the extent of delegated powers. They are questions for political officials to resolve in the end.
There is of course a second point in McCullough -- intergovernmental tax immunity. The states can't tax the Bank of the United States. It is another structural rule. It is a rule kind of like judicial review itself, which comes from the idea that we are all separate sovereigns. It is not a restriction on delegated powers, nor is it an interpretation of the 10th Amendment. It is a restatement of a supposition about how the Constitution got formed.
Well, then the question is this -- can you leap from the intergovernmental tax immunity doctrine to a general intergovernmental immunity doctrine? Not without contradicting the supremacy clause you can't, because this is a structural inference, a supposition about the union. You can't use suppositions to contradict the real text that got enacted, and nobody supposes that there is a general intergovernmental law immunity doctrine. Think about what that would mean. Is your state running short on funds? Just head on down to the Federal Reserve and take some.
Now, there is this Federal law against theft, and invading the Federal Reserve, and shooting postal carriers who might be carrying checks the state could use. But if there is a real intergovernmental immunity doctrine the Federal law against theft just doesn't apply to the states, and indeed states can go right out and print money and all the rest of it. That would be so antithetical to the structure of the union that it can't possibly be the case, and it's just not in the Constitution.
So what are we left with if there is no real intergovernmental immunity doctrine? The direction, I think, of McCullough, is that judges shouldn't be playing the policy game. That’s something I hope we can all agree on. But what's left about the structural point is that there is no discrimination against governmental bodies. That is, I regret to tell you, why I have to pay taxes to the state of Illinois. They can't charge me a higher rate of income tax than their own citizens pay. It is a kind of vicarious protection, but the fact that I am a Federal official doesn't protect me from state tax -- the anti-discrimination rule.
And there is a rule that the federal power over the organization of state governments comes only through the republican form of government clause. If Kansas decides it wants to be a monarchy, Congress can intervene, but if Kansas or Nebraska decides it wants only one House of government, well, then that is okay.
That set of rules, it seems to me, maps fairly well onto the doctrines we actually see. If you think about problems like Garcia, the Fair Labor Standards Act is a general act -- there is an interstate market in labor and states that wish to buy in that market are subject to Federal laws.
Prince, on the other hand, looks like a regulation of the internal structure of the state government and it looks like that is covered by the intergovernmental immunities doctrine, unless it was necessary to produce a republican form of government.
Then there are hard cases -- hard cases like Condon, the one now pending -- the Drivers' Privacy Act. I must say, I hate giving talks like this where I have to talk about the "fair" Labor Standard Acts and the Drivers' "privacy" Act.
But here we are, here we are. We have the Drivers' Privacy Act. It is not neutral because the only people who license drivers are states, and so this law applies to the states. This is not like the Fair Labor Standards Act, in which states are just shopping in a labor market. On the other hand, there is no discrimination against the states here.
First, it doesn't tell the states what laws to pass or anything like that. They have to keep records, but that is true under the Fair Labor Standards Act, and nobody these days can own a database without becoming a target for federal regulation, right? Every bank gets regulated. Even universities get regulated. They have to disclose this and they can't disclose that. So the states end up holding a database and -- surprise -- they get treated just like banks.
The question posed in a case like Condon is which matters in the end. Form -- the fact that we don't have some universal database law, but an individual database law which applies only to the states? Or function -- what happens when it is agreed that the nondiscrimination norm has not been transgressed?
My court, in an opinion some of you may have read, called Travis v. Reno, picked function and sustained the law. It is my fate in life, I suppose, to sustain laws with words like "fair" or "privacy" in them.
JUDGE EASTERBROOK: But I think an argument can be made for form. A good argument can be made for form. But making an argument for form as a method of making this decision has a danger, because as soon as one picks form as the means you get the following formal rule -- Congress can engage in bribery but not extortion vis-a-vis the states. Congress can't force states to follow the Drivers' Privacy Act but it can bribe states to do so by taking away all their highway money unless they volunteer to comply.
Of course, where does Congress get the money to do this? Well, from taxing the citizens of the states and then giving the money back to the states. The states are actually complicit in doing this because having the money raised at the national level turns off the possibility of competition among the states for having different levels of taxes in different programs. It helps the states to cartelize.
But if you were asking, as an original matter, whether there should be a preference for bribery over extortion in the management of federal-state relations, you would have some difficulty answering yes. But as soon as you say the task is entirely formal, you are bound to give the answer yes, as we do. But in any event this is a tale for another day. My message for today is this -- if you want modest, restrained judges, as you should, you need to support that restraint across the board, and to search for discrete minimizing rules of federalism, while leaving the major issues to the political branch, from which you will now here. Thank you.
SENATOR THOMPSON: I am somewhat at a disadvantage. The debates in Congress are usually much more highbrow than this.
SENATOR THOMPSON: But, as a representative of the impetuous vortex, I will do my best to bring the level of conversation down from what we usually are engaged in in the United States Congress.
I think one of my staff members put it best. When they asked me where I was going, I said I was coming over here to talk about constitutional issues. He said why would they be asking a member of Congress anything about the Constitution?
SENATOR THOMPSON: I am hard-put to answer that question. I must say that I am somewhat pleased at the trend of the courts recently and the Printz [v. United States] case has been referred to, [City of Boerne v.] Flores, [United States v.] Lopez, and the other cases. I do believe that we have gone down the path towards centralization in an attempt to homogenize society overly.
I remember in law school when I read Wickard v. Filburn and discovered that raising wheat on one's own farm and consuming it on one's own farm had a direct impact on interstate commerce. I knew the game was not on the level --
SENATOR THOMPSON: -- and that we would have to some day do something about this. So now the question becomes, is there anything in the world that is none of Congress's business? And I am delighted to be asked to discuss this here with you today. I am very mindful of the fact that people point out constantly that we live in a different society. It is much more complex. We live in a global economy. We have technologies our founders did not foresee all of that, but some things do not change. The basis for federalism I think is one of those things, human nature, the nature of power, the way it is exercised, the beneficial effects of competition, and those things are still very much alive and with us I certainly hope.
I do think when I say, somewhat pleased, I must say that the court -- the decision to me seem to be rather limited in scope. The question is not what they do but the question is do they portend anything? Are they trying to tell us something? Are they seeing something out there? Is the Court seeing something out there maybe that the rest of us haven't seen yet and that is a desire to go back to first principles? They seem to be raising their head up a bit, but it seems to me like most of them have to do with 10th Amendment, 11th Amendment, 14th Amendment cases that have to do with states as states. Certainly it does not solve some of the problems that have been mentioned before and that is the individual liberties of the individual citizens, which of course is the tail end of the 10th Amendment.
But I think that is good anyway, regardless of what you think of states. It is not that states are necessarily good and do not do bad things. It is that they are there and they provide competition for the national government and they also provide competition with each other and I think that, in and of itself, is a desirable thing and something that should be protected.
I am somewhat more interested in the Lopez decision. I have always been fascinated by Acts of Congress that deal with things that have been under the state purview for 200 years and we decide some morning that we want to pass a law that deals with something that is absolutely, clearly none of our business and has no effect on interstate commerce. But we did that in Lopez.
The question again is what does it mean? I suppose we will know more after the Violence Against Women Act case is decided, but it could mean that it is limited to crimes or non-economic crimes, crimes not having to do with the economy. It could mean crimes not having to do with economic factors that duplicate state law. It could be a very narrow kind of situation. I am very hopeful that it doesn't turn out to be the case and it portends other things.
I am pleased because it seems to get back to the concept of enumerated powers. While we can't learn by reading the 10th Amendment over and over again, I think it would do us well to read Article I over and over again, which is supposedly the source of congressional power. I assume that the 10th Amendment means something in addition to that, and I am looking forward to learning more about that from my much more learned colleagues. I am certainly not here to argue constitutional law with a federal district judge because it is true that they do have lifetime appointments, but it is also true that if they are nominated for a higher office they are confirmed before the United States Senate.
SENATOR THOMPSON: So keep that in mind.
SENATOR THOMPSON: I certainly hope that all this is not left to the good graces and the friendly clutches of the Congress of the United States, because, while I am somewhat encouraged by what the Supreme Court is doing, I hope no one asks the Supreme Court if they are encouraged by what Congress is doing. The Court has actually provided us, it seems to me, a legal basis in Congress, and political cover, quite frankly, to show some restraint, and our response to that as a Republican Congress has been to pass Lopez. The Court pointed out that it does not affect interstate commerce -- there was no finding as to that -- and we come back and as a pro forma matter say, oh, yes, it substantially affects interstate commerce. That was our response to that.
It shows just how steep the hill is. The trends towards centralization DeTocqueville talked about are certainly there, I think, in any democratic society. I think we have demonstrated how difficult it is with us and, while we have done some things -- we have pointed out the habeas corpus matter, the prison litigation reform. Also, I think you could put unfunded mandates, as limited as it is -- welfare reform also -- in those categories as things where we have made some progress. But in the midst of that -- on things that perhaps are not as high profile -- we are constantly legislating in areas that are questionable, to say the least.
A Harris poll came out as to the nature of the difficulty, why it is so difficult in addition to the nature of democratic governments. The Harris poll recently, this last week, said the top three issues on the minds of the American people are education, health, and crime. I think Alice Rivlin pointed out in her book on federalism back several years ago, you know, that all Presidential campaigns now have to do with matters that should basically not be the Presidential campaigns' business. They have to do with state and local matters.
I think this kind of highlights that point. This is on people's minds and we have legislation, by George, to deal with each and every one of those issues that happen to be on people's minds, so we are over there now considering legislation that would set rules for liability for a teacher in the smallest hamlet and the smallest state in the union, HMO reform of course, and we continue to federalize crime.
You know, we started out in this country with crimes like treason, counterfeiting, and piracy in the Constitution, and now we have over 3,000. We don't know exactly because many of them are regulatory crimes now and we haven't found all of them.
SENATOR THOMPSON: But the ABA's task force report on it points this out. It is doing great damage to our judiciary. It is slowly creating a national police force. It is interfering with local law enforcement, which constitutes 95 percent of the prosecutions in this country, but we continue to do it. The issue is not what we ought to be doing. The issue is whether or not we are against crime, and when the issue gets down to that, the matter is pretty much resolved.
The Volunteer Protection Act, where we decided volunteers ought to be protected -- well, states had addressed that of course, so -- but that passed 99 to 1 in the United States Senate. I was very persuasive in that particular instance.
SENATOR THOMPSON: But, as a member of Congress, I can bring you something, a bit that the others cannot because they have brought you so much that I cannot on this panel, and that has to do with my particular vantage point as a member of Congress.
It seems to me that what we do deprives us so much of opportunities we should be taking. It reorders our priorities in a very, very bad way. You could make a case that the major challenges facing this country have to do with basically two categories -- one, the ones that the demographic time bomb presents us with, Social Security and Medicare; and the other one is the foreign nature, the different nature of the threat that we are facing now.
We have received four different reports -- Cox Commission, Rudman, various other reports, Rumsfeld Commission, one recently from the House of Representatives -- that are consistent in that they are saying the rogue nations now have pretty complete capability in terms of biological, chemical and nuclear warfare. What have we done? We still do not have a missile defense system. We have made no progress in terms of Social Security or Medicare. We are in this silly debate now about locking up Social Security, which exercises some restraint on spending, I grant you that, but it has nothing to do about the long-term viability of Social Security.
We spend all of our time on matters of budget which are down there right now. Somebody down there is writing the law. We'll find out in the paper next week what it was.
SENATOR THOMPSON: And then we start all over again and in the meantime we rush to the floor, voting on many of these things and much of the problem has to do with the fact that no one is highlighting or has time to address or really realize what we are doing in many cases.
We are doing things like preemption. Now if Congress under the Supremacy Clause legitimately decides to preempt something, so be it. We can have that debate as to what should be and should not be. But more and more and more -- I guess it's the fastest-growing area perhaps of Constitutional law in terms of cases in the federal system. I don't know. Someone said that it was -- we are passing laws. We are silent on the issue of preemption and leaving it to the courts to decide whether or not we meant to preempt. We have the doctrine of implied preemption. We have doctrines of field preemption -- did Congress mean to occupy the field -- and they are supposed to be trying to determine congressional intent when what they are doing is looking at it and determining whether or not they like the outcome.
Well, I had a radical notion. Let's say whether or not we mean to preempt. Of course, all hell broke loose when we set that forth, basically saying that there is no preemption unless Congress states it or there is a direct conflict, so we now know that those on the other side of federalism are big business, labor, environmentalists, we learned, the states, Congress, and we don't know about the Supreme Court yet. Other than that, everybody is for federalism --
SENATOR THOMPSON: -- but we have flushed them out of the woodwork.
SENATOR THOMPSON: The real challenge I think has to do with policy questions and not constitutional issues. I think we realize however Lopez shakes out, we are still going to be left with a very broad Commerce Clause and the question is going to be left to us. What makes good policy? How is Congress going to handle the energy deregulation and the Internet and the increased telecommunications litigation or legislation, and other things that impact mightily on our economy, things that are global in effect but also have local characteristics and local facilities for these companies that are doing global things?
You can sit in your very local living room and use a telephone and it has international ramifications, but you also have a local phone company and a local tool and somebody put it in for you. That sort of thing, and how we pull down these state barriers that I think was the original intent of our forefathers without destroying the competition between the states.
So, regardless of this bleak picture, I do think that there is some cause for optimism as far as federalism is concerned. There is a trend towards centralization. As Michael points out in his book, these things tend to ebb and flow. Within that very trend there is a countervailing happening usually, and that is we are shown that we cannot achieve the things that we think we can with centralization and there is a reaction to that. I think we are seeing some of that.
It is not all good, but I think there is a good deal of skepticism out there, and maybe even cynicism on the part of many people. The government is less relevant to their lives. They see that private industry and states are doing much better than they used to do and the federal government is less relevant and not particularly competent. You cannot continue to read things like we see where the last couple of years we wasted $200 billion in the Federal Government. A GAO report last week said in just a handful of agencies we paid out $19 billion in overpayments, just sent people checks when we weren't supposed to. That sort of thing.
So people react to that. The President says the era of big government is over, which tells you where he thinks a lot of people are anyway. The reaction to the Executive Order when President Clinton attempted to do away with President Reagan's Executive Order, the reaction to that was pleasantly surprising. People didn't like that, so we must concentrate not just on the legal part and not just on the constitutional issues. We have a good debate going there and thank goodness for that., a debate that we haven't had in a long time in this country. But we must have a policy debate and the people in this room must help with regard to that because part of the problem is ourselves here because our consciousness has not been raised often enough with regard to some of these issues.
We must make these decisions in terms of how we balance these things that we have all been talking about consciously, and not by accident, and not throwing it to the courts when we had no intent -- they were trying to determine our intent and we had no intent --
SENATOR THOMPSON: -- with regard to the issue one way or the other. We must do it consciously and we must do it based on a principle and not how it affects a particular group, not how it affects a particular constituency, not how it affects a particular business.
I am very mindful that my bill -- some people say that the trial lawyers are for that. I didn't know that. I was glad to find someone --
SENATOR THOMPSON: -- but I said I was mindful and oftentimes used the adage that anything that was bad for the trial lawyers was good for America, but I was not aware that it had been raised to a constitutional principle yet --
SENATOR THOMPSON: -- so thank you very much.
MR. AZAR: Thank you to all the panelists for all those thought-provoking presentations. I would like to ask if anyone has anything they would like to say up on the panel but otherwise I would like to open it up to questions from the audience if possible in the time we have remaining.
Let's go to questions. Over there?
AUDIENCE PARTICIPANT: There hasn't been much reference to the spending clause, which I assume is because as a matter of political reality, if nothing else, the Court is not about to take us away from the plenary of spending power and back to an instrumental approach. In light of that political reality, what is the real benefit of a more constrained commerce clause jurisprudence since the Federal Government can simply bribe the states into doing its bidding?
SPEAKER: Let me respond to that by saying I don't think that the spending power is quite as magic a solution for those that want national regulation that one might either hope or fear, depending on your perspective on the matter.
I was involved, having argued the Brady Act case, and informed the President that the Act had been struck down, I wanted to go over it myself to say do not try to fix this through the spending power. And, it turns out it is a difficult thing to do.
First of all, I would not have wanted to put before the present Court, a spending power case that immediately tried to overturn one of their decisions. As someone for arguing the positions for the national Government I thought that would be foolhardy at this time. The Fourth Circuit has certainly already raised issues about whether one could take the money and challenge the restrictions as over-reaching. But secondly, it is a little harder than you think.
I do think that spending clause users are going to be Constitutionally vulnerable if the spending withholding is far removed from the restriction Congress seeks to impose. That is to say, the most defensible [position] is you have got to spend highway funds building highways, and then you have got to use good quality asphalt. Those are easy.
With the Brady Act there was reluctance to pin it to money that was used for state systems of searching their database records for illegal gun buyers because of the fear that many jurisdictions that were more opposed to gun regulation would turn the money down, which the gun control advocates did not want, all right? So then if you move to larger state funding like law enforcement money more generally being conditioned upon doing Brady Act background checks, the law enforcement community was opposed to that. An important political constituency that supported the Brady Act did not want their funds - their big federal grants - tied up with this kind of restriction.
If you move further away than that, then I became very concerned about the Constitutional vulnerability of any legislation where the money was far removed. So, I think one thing that leads some of these issues to still have viability is that there are both Governmental political and perhaps even Constitutional restraints on how effectively the spending power could be. It is not as magic as one might hope or fear.
AUDIENCE PARTICIPANT: This question is actually directed to Mr. Greve.
I am Bob Carlson. I was Ronald Reagan's Welfare Director when he was Governor and later U.S. Commissioner of Welfare and I was in the White House with him, and for 20 some odd years was pushing for a replacement of the open-ended matching entitlement programs in Welfare with finite block grants to the state.
I have to make it a very big distinction between turning an open-ended entitlement program where the more the states spend, the more money they automatically get, which is a very perverse incentive to spend in good years as well as bad to bring in more federal money, with just a finite appropriation to each state where we in effect said to them this is what you are going to get, but it is all you are going to get, but if you develop programs and spend it the right way, without federal interference, you get to keep what you save.
So what we did is we reversed all the incentives and the rolls are going down all over the country when normally in good times the rolls used to go up, so I don't think we can always. And, by the way, one other thing: In the 20 some odd years I was working on this, I never was able to get one single Governor, including good conservative Governors, to back going to finite block grants instead of the open-ended entitlement programs. The only Governor that ever did that was Ronald Reagan.
So when we were able to get the Governors to finally agree to do that in 1996 that is what put the pressure on President Clinton to sign the House and Senate welfare reform bill,. So yes, the states would love to have money, and not have to raise it themselves, but when you change an open-ended entitlement program to a finite program, that is good federalism.
DR. GREVE: I don't deny at all that the '96 reform was progress, but it is a very odd arrangement nonetheless.
I think the decisive part of the '96 reform is not at all that welfare all of a sudden became a block grant. The decisive part of the '96 reform, which is much underrated, is that it abolished individual entitlements to welfare, and that is a totally great thing. Otherwise, the advocacy groups would be right back in court hammering the living daylights out of states and saying you can't do this, you can't do that, because we have an entitlement to welfare.
With respect to the tax issue, my point was this: consider the welfare “swap,” an idea proposed under the Reagan Administration. (It is still being touted by such right-wing radicals as Alice Rivlin and the Progressive Policy Institute.) The way it would work is that the Feds would end their contributions to AFDC in return for assuming the states’ obligations under Medicaid. All the states would come out ahead under that system because Medicaid, especially in the '80s, grew like Topsy. Nevertheless, the Governors did not want that deal. Even though all of the states would have been better off financially, they were not going to take it.
That has to do with the political economy of federalism I described. It is just a very basic and stark fact.
MR. AZAR: Over on this side?
AUDIENCE PARTICIPANT: My question is for Judge Easterbrook, on your observation that judges should not examine how much interstate commerce is enough in reviewing Acts of Congress.
The delegated power is to regulate interstate commerce. To what extent should un-elected judges look to see if that is what Congress is really doing as opposed to doing something else on the excuse there is some interstate commerce in the vicinity?
JUDGE EASTERBROOK: My answer is not at all. You will find that I am very resistant to general camel's nose under the tent kinds of things. And one thing that has always concerned me, because it produces an empty rule and therefore no restraints on discretion, is looking past what people have actually done or say they have done to find their intent, their purpose, and so on, because that is a game that can be played not only with the commerce clause but with the taxing power.
For example, there is a nice large tax per pound of marijuana. Is that to raise revenue, to get rid of marijuana, right? It's not a game the judges should be playing if you want a judiciary that respects political decisions.
As a matter of precedent, this particular question was raised at the end of the last century when Congress used its power over interstate commerce to prohibit the movement of lottery tickets across state lines, and that was attacked as saying well, now you are not regulating commerce in lottery tickets. You have ended commerce in lottery tickets and that is different. It is a line the Court rejected.
Congress has used its commerce power now and again in exactly that way. The reason why child labor has been ended is because Congress has prohibited the shipment across state lines of things made with child labor. One may think that was a good law or a bad law but since the commerce book was there, I think it proper for the judges to say we are not going to look behind it.
DR. GREVE: I just want to comment on this.
I should know better than to take issue with Judge Easterbrook. But I am not a lawyer. I will never appear in front of his court --
DR. GREVE: Let me approach it this way. Judge Easterbrook says you ought to favor judicial restraint across the board because otherwise judges will get into all these policy areas. Well, restraint across the board is in fact not what we have. What we have instead is extremely aggressive review under the First Amendment and other parts of the Bill of Rights -- and, until Lopez and until City of Boerne, almost no review under the enumerated powers and structural provisions.
The question you have to ask yourself is - “Is there any justification for that?” As a matter of first principle, the intuition ought to run exactly the other way: the Supreme Court's power ought to be at its zenith in the structural cases for the reason that I mentioned, which is that there is nobody else around to enforce these norms. You can't leave the task to the states because that would mean secession. You can't leave it to the Congress because Congress knows darn well how to enforce structural constraints - which is to ignore them. So it has to be the Court. This is why every federal country has judicial review in our sense (Germany, Australia) and why unitary countries don't have judicial review in that same way (France, for instance.)
Now are there reasons why you want to override that initial intuition and say we are going to take our hands off in structural cases and then go haywire or be very aggressive in the First Amendment cases?
Well, you can be a total nominalist like Lino Graglia -- no judicial review for anyone, anywhere, anyhow. That, I think ,is not Judge Easterbrook's position, otherwise he has a very odd job.
DR. GREVE: So is there some other reason? I concede it is hard to tell how much commerce is enough but I don't have a problem saying that domestic violence is not interstate commerce. It is very hard to explain this to federal judges, but I am fairly comfortable with my proposition.
DR. GREVE: One reason why you could say that judges ought to stay their hands in these structural cases is the argument from democracy that Judge Easterbook mentioned: judicial view is anti-democratic. Now the same is true, of course, every time the Court steps into the arena. You might say that under the First Amendment that is not so bad and anti-democratic because the Court is for the most part beating up on the states, whereas in structural cases, in enumerated powers cases, the Court is going up against the Congress and throwing its weight around against the entire country. But, if anything, it seems to me that that argument cuts the other way. When the court tramples on the states, they can't fight back, which is exactly why the Court is having such an easy time of doing that. Congress, in contrast, is a big bully and can fight back. It has the institutional means. So the courts will as a matter of institutional incentives be very reluctant to go up against the Congress and more than willing to beat up on the states. So once again: if you want to have one rule of restraint or one standard of review in all of these cases, that will be fine by me. But it is not what we have. What we have is in a lot of ways upside-down judicial review.
MR. AZAR: Judge, would you like to shoot back?
JUDGE EASTERBROOK: Yes. I want to make it very clear that my idea is not that judges be particularly restrained but that judges be faithful to the actual text and structure of the Constitution we have. I am no fan of aggressive review in support of personal rights and supine review when dealing with structural issues --
JUDGE EASTERBROOK: For me, for example, to take a case that is mixed, a case that I worked on for awhile with Bob Bork, I should think the Federal Election Campaign Act, although it is kind of structural, is un-Constitutional root and branch because it regulates the political process. That is just something the First Amendment says. You can't do it. Well, there it is, alas. The Supreme Court has held un-Constitutional all sorts of structural things, like the one House veto, with my applause, and has failed to hold un-Constitutional what seemed to me blatantly un-Constitutional things like the Independent Counsel Statute, which purports to authorize courts to appoint inferior officers that don't have superiors.
JUDGE EASTERBROOK: Justice Scalia was absolutely right in that case and he lost because too many of his colleagues were busy looking at whether this is a good law, which seems to mean something they should not have been looking at.
The Supreme Court back in 1925 held the Tenure of Office Act un-Constitutional and said that the President can get rid of Postmasters because the Executive Power is reposed in a President of the United States. We have a system in which the Executive Power is reposed in the Federal Trade Commission and I have serious doubts about whether that can be reconciled with the text of the Constitution.
The question is not then aggressive versus supine. It is “Can you ground your judgments in the real text of the Constitution as opposed to concerns of political theory?” The political theory in 1787 may not be today's political theory but it is the one binding on us.
AUDIENCE PARTICIPANT: Either fortunately or unfortunately, I have another question on the commerce clause for Judge Easterbrook.
Not only does the commerce clause not tell you how much commerce has to be -- how much effect you have to have, but it doesn't tell you what commerce is. I would like to pose two hypotheticals to you that we're constantly grappling with at the Department of Justice in defense of our statutes.
The first one, very shortly, if I walk across the Wilson Bridge from the State of Maryland to the State of Virginia with intent to commit a crime of violence in Virginia I walk across the channel of interstate commerce. I don't take a bus and pay for a ticket. I don't take a taxi and pay for the taxi fare. Have I committed a violation of 18 USC 1958, and as applied, if I have committed that violation, is it Constitutional?
The second hypothetical is I live in New York City. I walk up to a guy in New York City, rob him of ten bucks. Now ten bucks -- I am not talking about depleting the assets of a store. I rob a victim of $10 and I argue if there are 100,000 robberies a year in New York City and you aggregate that ten bucks, I have affected commerce.
If those two scenarios are Constitutional, and sometimes I hope it is, what is left on the limitation of the commerce clause?
JUDGE EASTERBROOK: Let me say that since I have not planned recently to walk across an interstate border and commit an act of mayhem I don't even know what 18-58 says.
AUDIENCE PARTICIPANT: All right -- 18-58 says if you travel in interstate commerce with intent to commit a crime of violence it is a federal offense, and that could be using an interstate telephone or a channel of communication in interstate commerce.
JUDGE EASTERBROOK: Well, yeah, you know, being somebody who thinks one ought --
AUDIENCE PARTICIPANT: I stumped the judge. I can't believe it.
JUDGE EASTERBROOK: -- read before giving opinions, I have to say something like, gee, I have to figure out whether the words "in interstate commerce" has some special meaning in that statute. It is not a good idea for a judge to give an opinion first and think later.
JUDGE EASTERBROOK: All I can tell you is I haven't a clue about that question.
As for the robbery of $10, I can tell you that every federal court has held that that is, if Congress wills it, to be within the power of Congress, because the Hobbs Act, which deals with extortion of state and local legislators, deals with payments as small as ten bucks on the theory that in the aggregate something is going on, and one might as well suppose indeed that if the rage for paper money has had its force. You take out this $20. It has a picture of a U.S. President on it. It says it is a Federal Reserve note, and if Congress wants to say what you do with Federal Reserve notes is within the Federal power it does seem to me that it has probably got a pretty good hook.
SPEAKER: Let me just add one footnote, since I am less constrained that Judge Easterbrook.
Remember that the central, one central accomplishment of the framing of the Constitution, 1787, was the creation of the single greatest common market the world has ever known, the creation of a national market, a single national market may well have been indispensable to the growth of the American nation and that goods therefore, guns, for example, were made by local craftsmen in the late 1700s and were expensive products but the great national market allows them to be inexpensively delivered anywhere in America. So, there is at least that sense in which the creation of a single national commercial market creates problems as well as opportunities and give Congress some authority to regulate that it would not have had we had a balkanized economy. I don't make a great case for that but that is the essential creation of Philadelphia that in a sense leads to some of what may be seen as anomalies.
AUDIENCE PARTICIPANT: Senator, if I could follow up on what Mr. Dellinger just asked, you have seen through the opposition to the Federalism Accountability Act by the Chamber of Commerce that business interests actually do recognize what Mr. Dellinger has been saying. I think two of the Chamber officials said that the prospect of conflicting regulations from 50 states and the District of Columbia terrifies the business community was their reaction.
Other than the plaintiffs’ bar, is there any real constituency out there if Judge Easterbrook is right and it really does fall to you all in the Congress to stand against nationalization of all business regulation? Is there a constituency out there that can support you?
SENATOR THOMPSON: Oh, yes. I think potentially there is. We have to make sure that there is I think once the issue is highlighted and put on the table. I am not sure a lot of people who have a problem with it really want it to be highlighted and put on the table, because it is difficult to take a position I think that they don't want Congress to say whether or not they are intending to preempt, so I think we have got the better end of that.
It is understandable to me. There is a case pending now before the Supreme Court on the air bags case. The federal Government said, you know, you must have either air bags or seatbelts, some of you guys know more about it than I do, correct me, so the defendant chose seatbelts, and now a state allows under a common law a lawsuit, as I understand it, to sue and say, well, even though you did what the Fed said, we still think you can be sued and if the jury so determines you can be held liable under our state law, just as if there had been no federal law passed.
Now the whole business, as I understand it, is whether or not Congress meant to preempt, and I am told that part of the statute says yes and part of the statute says no, and so my idea is, listen, I can understand why Big Business would rather have one rule and perhaps no states. I can understand why business might not want competition, but I really have difficulty understanding why it would be a bad thing in that case for example for Congress to have stated clearly whether or not they intended to preempt.
SPEAKER: Congress actually stated very clearly that all state rules inconsistent with the federal standards are preempted and all state remedies are preserved.
SPEAKER: Both of those statements in the statute are equally clear. The problem is that there are two of them.
SENATOR THOMPSON: That was before I got there, I think.
MR. AZAR: Roger?
AUDIENCE PARTICIPANT: Yes, that is the same Congress you're only too willing to defer to.
I want to put to you the kind of question, Judge Easterbrook, that you might get if in the future you were sitting before the Senate as Senator Thompson alluded to.
I am having trouble squaring a couple of points that you have put forward -- your deference to the political theory of 1787, which you said is what binds us, your premise of the framers having elected to put us in a state of Constitutional democracy, and your reluctance to have the judiciary say much at all about the scope of the commerce clause, which is what I understood you to say in response to an earlier question with the nose under the tent.
If I understand the original design as in, for example, Madison's remarks that the powers of the Federal Government would be few and defined, I don't see how that squares with the ample reading of the commerce clause that you seem to be willing to allow in the case of Congressional power, which leads me to ask you would you concur with Judge Bork this morning who said that the revival of enumerated powers is a lost cause?
JUDGE EASTERBROOK: I am less engaged in the punditry business than Bob Bork is these days.
JUDGE EASTERBROOK: And I hate to try to predict what my colleague in the Senate will be able to achieve. I don't know what causes are lost.
If the question is “Is it a lost cause in the judiciary?” I don't think it was ever a found cause, and I want to make two points about it.
First, the question about what the Constitution does depends on what is in the Constitution and not on what somebody predicted it would do. Those people who are, like me, dedicated to carrying out the original plan, always want to distinguish between that plan that got written down and people's expectations about what would happen, and the line from the Federalist that was read to you. Certainly Madison's line that by breaking up the powers between the state and federal Government and breaking the powers within the federal Government it will be proof against a rage for paper money doesn't make paper money un-Constitutional when paper money finally is issued.
The expectations about what a structure will do are contingent on many other things. Paper money got issued during and after the Civil War when some fundamental changes had been made and now, of course, we don't even have paper money. We have electronic money, largely.
My second point is that this was a structure -- this is Marshall's critical point in McCullough -- this is a structure designed to last for a very long time. I think that Madison's prediction was absolutely on the mark for the first hundred years because so much commerce was local, precisely because it was so expensive to move things. It took weeks to move physically from one part of the country to another, extremely expensive -- no instantaneous communications.
But the country was not designed to replicate for 1999 the economic conditions of 1787. The economic conditions change. The power is what it is. What has happened is that a much larger percentage of what happens in the country is in or affecting interstate commerce than it used to be. That means the power today operates on more than it used to, but the power hasn't changed, only the consequences as a result of economic behavior in the rest of the world. And, I don't think it is proper for the judiciary to say, well, what we have got to do now is change our understanding of what interstate commerce is to put the federal Constitution more back - what would happen if commerce were much more expensive than it is.
SPEAKER: The only problem that I've got is distinguishing that answer from the same answer that would be given by a Bruce Ackerman or a Larry Tribe.
DR. GREVE: I find myself in the awkward position of being somewhere between two poles.
On enumerated powers, there’s a lot of posturing in the Federalist Papers -- a lot of saying, don't worry about national power. The Federalist was written for a political purpose and one should not abstract from that political purpose and attribute to particular statements a doctrinal significance that they don't possess. I think that the Federalists themselves knew that enumerated powers would be more or less enumerated.
If that makes me sound like Judge Easterbrook I will go back to the other end and say this: the fact that there is lot of room for play in the joints cannot possibly mean that we throw in the towel and say that commerce just means anything.
I think Justice Thomas's Lopez concurrence is a sensible place to start looking for some distinctions that might actually make sense. Judge Easterbrook immediately jumped from a lot more things being “commerce” to “affecting commerce.” Well, that is not what the clause says. If the founders had wanted an “affecting interstate commerce clause” they could have written one. They didn't. It had to be commerce. That probably isn't agriculture or manufacture because it is hard to make sense of a clause that says Congress shall have the power to regulate agriculture or manufacture among the several states or with the Indian nations.
For all the trouble and for all the difficulty of drawing these lines, it is no different in principle from trying to distinguish speech from conduct, which courts do all the time and which is also hard. We have to draw lines. The conceptual lines are difficult, but you can't deploy that argument with respect to structural constraints only. If you want to make the argument, make it across the board.
MR. AZAR: Walter?
MR. DELLINGER: To the extent that one wants to view with alarm the notion that commerce which affects more states than one is a larger category, let me remind you that sometimes, for a lot of times for 150 years national power cleared the way for human freedom -- still does to a much lesser extent today, but may in the future. And the Act which Judge Easterbrook voted to uphold, the Drivers' Privacy Protection Act, which was the subject of argument in the U.S. Supreme Court the day before yesterday, is a good example of Congress saying to the states leave people alone -- in a small respect, to be sure, but it is telling Government to leave people alone.
In the absence of the Drivers' Privacy Protection Act, if you are in Columbia, South Carolina, you can't travel to any of the other 49 states by car, van, SUV or truck without permission of Governmental bureaucrats in South Carolina who tell you that you can't drive any of these vehicles anywhere instate or out of state unless you turn over your name, address and telephone number, which they are then going to sell to anybody that saw you in a bar and thought you looked cute, got your driver's license, and say I'm a stalker, I want to pay $3.50 -- I would like to know the home telephone number and address. Now that is a constraint on commerce which Congress could set aside and which it did by simply saying you can use this information for your own state purposes, but don't go selling in the channels of interstate commerce people's license numbers and their home addresses as a condition of them being able to operate and drive an automobile. I think, if I can hazard a prediction, the Court is going to find Judge Easterbrook is right and uphold that one against the federalism challenges and give people a little more breathing room from Government extracting information from them and then turning around and selling it.
MR. AZAR: I am afraid that is going to have to be the last word. Leonard has asked me to mention that we are going to be moving over to the East Room next door for a cocktail party and then at 7:30 if you all could just move into the banquet room, and thank you very much.