Friday, June 17, 2011

Regulating Commerce

Given the recent talk from the department of transportation regarding the possibility of requiring farmers and ranchers to have commercial drivers licenses, I thought I'd revisit some the flawed ideas related to the commerce clause.  As it is, one of the regulator's primary concerns is if agricultural activity in this sense constitutes 'interstate commerce.'

In the case Wickard v. Filburn (1942) the Agricultural Adjustment Act (AAA) was found to be constitutional. This was on the basis that congress had a right to ‘regulate commerce.’
The power to ‘regulate commerce’ can be found  article 1 Section 8 of the constitution. It is listed as one of the enumerated powers of the constitution: 

‘To regulate Commerce with the foreign Nations, and among the several States, and with the Indian Tribes;’

In this case a farmer’s crop was being taxed because he produced more than was allowed under the AAA. His defense was that the federal government had no power or business telling him what he could grow on his private property in his state. 

The court concluded that even though his crop was grown on his land in his state, it was possible that after he sold it, it could be marketed with grain harvested by other producers across the country. As a result this was considered ‘interstate commerce’ and could be regulated or taxed. The court did not give any more specific definition of ‘interstate commerce’ and set a precedent that if an activity could be considered ‘interstate commerce’ in theory, then it was subject to federal jurisdiction.  
Was the court’s decision consistent with what was written in the constitution and our founder’s intentions? How broad did they interpret the power to regulate commerce?
What was meant by regulating congress among the several states?

In Federalist # 45 we read the following:

‘The powers delegated by the proposed constitution to the federal government are few and defined. Those which are to remain in the state governments are numerous and indefinite.’
‘The powers reserved to the several states will extend to all the objects which, in the ordinary course of affairs, concern the lives, liberties, and properties of the people and the internal order, improvement, and prosperity of the state.’

It appears here that our founders never intended for the federal government to be very involved with business and agriculture in the states. The Wickard interpretation is very broad. It does not seem consistent with the idea that the powers of the federal government are few or defined. It is obvious that this decision is contrary to our founder’s idea of limited government. 

If we read Federalist # 41, six powers of the federal government are identified and explained.  Two of these described the federal government’s relationship with regard to interstate commerce. 

‘Maintenance and Harmony and proper intercourse among the states.’
‘Restraint of the states from certain injurious acts.’

 To put this in context, after the American Revolution, some of the states were imposing tariffs on each other. The purpose of the interstate commerce clause was to prevent these kinds of ‘injurious acts’ so that trade and ‘proper intercourse’ could take place between the states. The founders never intended that the federal government should  have the power to control every aspect of trade that occurred in or even between the states. 

Given this history and the state of fear that our founders had of a powerful government, they would have never ratified the constitution if they thought ‘to regulate commerce’ meant congress would have the power to intervene in private business based on nothing more than a theoretical connection to interstate commerce. Wickard v Filburn lead to a huge expansion of power unanticipated by our founders, and a transfer of power away from the people and states without their consent.The purpose of the constitution was to ensure that the government did very little without the consent of the governed. Court cases like these leave us defensless. 

As quoted from Ayn Rand’s book  Atlas Shrugged  ‘ …the government’s plans cannot be held up by the matter of your consent.’

Re-printed from my AgWeb post: 

1 comment:

Michael R. Brown said...

Thank you for this. We need to stop tying the hands of our food producers, especially in the coming age of commodity resurgence.