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American Enterprise Institute

May 2000

Laying the Groundwork
A slim Supreme Court majority is erecting boundaries around a Congress intent on bending states to its will. The justices have started a federalism revolution, but there is no popular uprising to support their coup.

By Steve France

If Edgar Allen Poe had told the story of the U.S. Supreme Court's ongoing reexamination of federalism, he would have titled it The Case of the Telltale Clause. In it the commerce clause of yore returns to haunt the justices, bringing back with it the specter of states' rights and laissez-faire constitutionalism.

This ghost story begins in 1995, and no one yet knows how it will end. Few scholars anticipated the controversial attempt by five justices to limit the scope of congressional commerce clause power over the states and to reintegrate state sovereignty into the modern Constitution.

Political Mortar Lacking

Still, even a partial return to pre-New Deal principles seems far-fetched to most. Sympathizers as well as critics recognize that unless the emerging case law enlists a potent political constituency outside the Court, it may amount to little. To them, the decisions are a revolution in search of a popular uprising.

The plot thickened on the last day of the Court's last term, when the justices handed down three 5-4 decisions recognizing state sovereign immunity against private suits to enforce federal statutory rights.

As a result of those decisions, Maine probation officers may not sue the state for overtime pay under the Fair Labor Standards Act. A New Jersey bank may not sue a state for federal patent infringement or for making false advertising statements in violation of the Lanham Act.

These cases served notice that the Court would continue to build a wall around Congress and champion states' rights against congressional power. More cases are pending this term, sharpening the issues and the rhetoric--and forcing the five-justice majority to fight on or signal a truce.

In a January decision, the four dissenters joined in what Evan Caminker of the University of Michigan Law School calls a "Hell no, we won't go" manifesto. Objecting to a ruling that states are immune from private suit under the Age Discrimination in Employment Act, Justice John Paul Stevens burned his bridges in Kimel v. Florida Board of Regents, 68 U.S.L.W. 4016 (Jan. 12). He was joined by Justices Ruth Bader Ginsburg, David Souter and Stephen Breyer.

"Despite my respect for stare decisis, I am unwilling to accept Seminole Tribe as controlling precedent," he wrote, referring to the seminal 1996 decision that resurrected state sovereign immunity, Seminole Tribe of Florida v. Florida, 517 U.S. 44. "The kind of judicial activism manifested in [the recent federalism rulings] represents such a radical departure from the proper role of this Court that it should be opposed whenever the opportunity arises."

The 5-4 majority opinion in Seminole Tribe by Chief Justice William Rehnquist held that Congress did not have the power to abrogate state immunity by authorizing Indian tribes to sue the states over gaming contracts.

Seminole Tribe and its progeny are the latest outbreak of fighting in a battle over the boundaries of state sovereign immunity that goes back to then-Justice Rehnquist's 1976 decision exempting states from national minimum wage laws in National League of Cities v. Usery, 426 U.S. 833.

Since then the Court has flip-flopped on the issue, expressly overruling National League of Cities in 1985 and in effect reinstating it in the overtime pay decision at the end of last term.

Despite his opinion in National League of Cities, the chief justice didn't succeed in reviving the commerce clause issue until 1995, when the Court struck down federal penalties for carrying guns near schools. He wrote the 5-4 opinion, United States v. Lopez, 514 U.S. 549.

For decades, lawyers, professors and judges had behaved as if the clause no longer existed. Scholars could even describe the time and circumstances of its demise: on or about April 12, 1937, the day the Supreme Court decided five cases upholding the New Deal. The justices bid adieu to the clause as a key part of their "switch in time to save nine" in the face of President Franklin Roosevelt's shocking threat to pack the Court.

The problem was that federalism was never given a proper burial. The Constitution was not amended to expand the commerce power or to alter explicitly the old federalist framework of limited federal power.

Sizing Up the Wall

Perhaps a final aftershock from the New Deal revolution was inevitable, but views differ widely on the proximate cause and probable outcome of the clause's encore performance as a limit on power.

For some, commerce clause issues have long been settled and the Court majority is just conjuring up ghosts that will allow states to curb the rights of citizens. Others say expansive federal legislation in the 1990s finally generated a backlash but not a truly ambitious agenda.

And there are those who see a potential rebirth of freedom in the restoration of the commerce clause, along with strengthened state sovereignty and tough limits on Congress' power to legislate under the enforcement clause of the 14th Amendment.

Lopez, which struck down the Gun-Free School Zones Act of 1990 as beyond Congress' commerce power, left many questions open and sparked a massive volume of commentary.

For example, the 1999 edition of Laurence Tribe's Constitutional Law treatise devotes 16 consecutive pages of discussion to the case and gives it as many mentions in the index as Marbury v. Madison.

At the end of his analysis, however, Tribe says it is not clear whether the Court is merely stirring the embers of a burned-out controversy or igniting a serious challenge to federal power.

Rehnquist did not clearly stake out which territory he meant to put off limits to Congress. He did indicate that the commerce clause could not reach activity unless it was part of commerce or it had a demonstrated, substantial effect on interstate commerce.

But that test takes many different forms, according to Tribe. The question remains whether the majority will be content to strike down only those congressional excesses that have tenuous links to economic regulation.

Political scientist and libertarian activist Michael Greve sees a larger agenda in the convergence of separation of powers principles.

The Rehnquist Court is known for working to maintain "horizontal separation" among the branches of the federal government, Greve says. The "vertical separation" of powers between the federal government and the several states derives from the same principle--the need to prevent concentrations of power.

Greve, a resident scholar with the American Enterprise Institute, hopes the Court sees its task in those revolutionary terms.

Given real choices, citizens who are not satisfied with state government "can vote with their feet as well as at the ballot box," and go pursue their happiness in another state, he points out. The people "get to choose among different sovereigns, regulatory regimes, and packages of government services," he says. This freedom disciplines the states.

Some states might lean in pro-business or conservative directions, but Greve suggests others could more easily engage in liberal experiments in such areas as gay marriage, assisted suicide and environmental regulation.

On the Threshold

The third and newest offshoot in the Court's revival of federalism places limits on Congress' power under the enforcement clause of the 14th Amendment.

The key 1997 case on the subject, City of Boerne v. Flores, 521 U.S. 507, invalidated a law that sought to combat states' alleged infringements of religious liberty.

The decision closes a back gate that Congress could have used to get around the restrictions of the commerce clause and state sovereign immunity.

Thus in Kimel the majority found that the 14th Amendment did not empower Congress to override 11th Amendment immunity in private age discrimination suits. Since age is not a suspect class, the Court held, the 14th Amendment cannot be used to bar private age bias suits against the states.

These cases give Greve hope that we are on the threshold of a real revolution. But Cardozo law school professor Marci Hamilton, who won Boerne, prefers a more modest metaphor: building fences.

"While it may come as news to some people--and positively startles politicians--federal power is limited," Hamilton says. "The Court is working consistently to mark meaningful boundaries, to limit the federal government's overweening power." What makes the limits seem new is "the backdrop of Congress' general expansion of its power," she says.

Hamilton points to three examples of busybody legislation. The Gun-Free School Zones Act, shot down in Lopez, merely piled federal law on top of state laws that already barred guns in schools. The Religious Freedom Restoration Act, invalidated in Boerne, did not rest on a showing that religious liberty was seriously threatened. A provision of the Violence Against Women Act gave victims of gender-related violence a federal civil right to sue, although every state provides civil remedies for assault.

"It is not judicial activism to strike those laws," Hamilton says. "It's a natural reaction to Congress overstepping its bounds."

Most observers, including Tribe, expect the Court to strike down the VAWA provision this term in United States v. Morrison, No. 99-5. The case is being litigated by Greve's former organization, the Center for Individual Rights.

Open and Notorious Federal Power

Dissenters on the Court and off believe it is the Rehnquist majority that is out of bounds. Abner Mikva is in that camp. Whatever the wisdom or necessity of such laws, he says he believes Congress had authority to enact them. "If these laws are mistakes, it's better that they be corrected by the people at election time than by the second-guessing of nine isolated people on the Supreme Court," he says.

Emphasizing how long that view of congressional power held sway, Mikva lays out a kind of constitutional doctrine of "adverse possession." Sixty years of open, notorious and adverse exercise of power support Congress' claim.

"When I graduated from law school in 1948, it was clear that Congress could pass just about any legislation it saw fit," Mikva recalls. He went on to apply that lesson for almost the next 50 years as he practiced law and served as a congressman, federal appeals court judge and White House counsel to President Clinton.

In the 1960s, Mikva was in the Congress that invoked its power over commerce to attack rampant, deep-seated racial discrimination by businesses in the South and elsewhere. The poetically captioned Heart of Atlanta Motel v. United States, 379 U.S. 241 (1964), upheld the 1964 Civil Rights Act and completed the transformation of the commerce clause from what had once seemed a limitation on federal power to a virtually unlimited grant of power.

Segregationist opponents of the civil rights movement had raised the banner of states' rights, but that merely put an indelible stain of Jim Crow racism on the entire concept.

The key point in the states' rights debate, chief dissenter Stevens said in Kimel, is that it is not a judicial function to protect state interests. Because each state has equal representation in the Senate, "The normal operation of the legislative process itself adequately defends state interests from undue infringement."

Unless and until the voters elect presidents who will give Stevens' position a majority, however, Court watchers will be trying to mark the boundaries of the new federalism. Hamilton likes to say the core issue is that Congress has to do its homework to show there is a real problem that needs a federal solution.

Uptick in 11th Appeals

If the Court asserts the authority to grade Congress' homework, massive amounts of litigation could be generated, says Mark Kravitz, a constitutional practitioner in New Haven, Conn.

He already has measured a big uptick in sovereign immunity litigation. "The lower federal courts are being inundated with 11th Amendment and federalism motions and defenses, and are having to sort through federal laws one by one while the Supreme Court keeps refining its doctrines," he says.

A computer-assisted review of the appeals court dockets indicated that the courts handled as many 11th Amendment issues in the four years after Seminole Tribe as they had fielded in the 50 years before, Kravitz says.

These cases fascinate students of constitutional law, but the general public lacks interest. The problem is that while everyone likes to bash big Washington government, few are ready to live without it.

"For most people, unfortunately, federalism is a doctrine of convenience," Washington lawyer Chuck Cooper says. Known as the federalism cop when he served in President Reagan's Justice Department, Cooper realizes there is no natural constituency for his philosophy. While big business might prefer less regulation, it also values the uniformity of federal regulation, he says.

Hamilton says even state officials often harbor ambivalence on the subject. She points to a case before the 4th U.S. Circuit Court of Appeals at Richmond, Va., that asks whether the Americans With Disabilities Act applies to state prisons.

When Maryland failed to make strong federalism arguments, the Association of State Correctional Administrators stepped in.

Hamilton filed an amicus brief for the association in February that claimed Congress could not regulate state prisons under the commerce clause, the 14th Amendment or the 10th Amendment (which the Court has said bars "commandeering" of state governments).

The American Civil Liberties Union, which represented the plaintiff, promptly agreed to "ridiculously low terms to settle the case and avoid an en banc decision against them," Hamilton recounts.

"The state was contorting its position beyond belief to appease the disability lobby," she says. "We were the only ones aggressively pressing federalism. It shows how the political process does not protect states. The courts have to police that line."

Greve is not deluded into thinking there is a ready-made constituency for robust federalism. His hope is that a "leave us alone" coalition ranging from smokers to small businesses will find shelter in the Court's decisions and grow stronger over time. But he takes solace in seeing little backlash against the Court's rulings so far.

Even if the Court sides with Greve, it will take a tremendous amount of work to change the system.

UCLA law school's Eugene Volokh points out that Congress can condition grants of money on state compliance with federal laws, or it can create federal bureaucracies to sue states when individual suits are barred.

More unlikely is a scenario that the framers probably would have preferred: a constitutional amendment clarifying the issues.

Mikva is not expecting help from the people, who in gener al don't object to limitations on the federal government. "People are turned off. They distrust government. It's an anti-government Court, but that reflects the mood of the people."

Mikva does not expect the federalism revival to get on the screen as an issue in the presidential elections, but it will come up when the Senate considers the next appointment to the Court. As the senators search for skeletons in the nominee's constitutional closet, they are sure to ask whether he or she believes in the commerce clause.