This Week, 63 Years Ago-April 8, 1952: Truman Seizes Control of the Steel Industry by Executive Order-What Did the Supreme Court Decide & Why? Part I – Guest Essayist: Professor Joerg Knipprath

, , , , , , , , ,

Separation Of Powers Case: Youngstown Sheet & Tube Co. v. Sawyer (Part 1)

When the Supreme Court addresses constitutional aspects of executive “overreach,” it often does so in the context of a clash between the President relying on a broad reading of his constitutional powers and the Congress attempting to limit those powers through the use of its own. The controversy that raises the issue is usually said to involve the Court in the delicate, but vital, role of “policing the boundaries established by the Constitution.” To decide just where the boundaries relating to the separation of powers lie, the Court typically looks to the framework established in the foundational case, Youngstown Sheet & Tube Co. v. Sawyer (1952).

The Steel Seizure Case, as it is often called, arose out of President Harry Truman’s decision, on April 8, 1952, to direct his Secretary of Commerce, Charles Sawyer, to seize the manufacturing plants of the major steel producers to avert a shutdown of production due to a threatened labor strike. In the face of abundant contrary evidence, the President argued that, in light of the strategic importance of steel to the Korean War effort, the strike would immediately threaten the national defense. Sawyer complied, but, conceding that the government really was not capable of running a productive enterprise, directed the officers of the companies to serve as operations managers for the government. The next day, and again two weeks later, Truman sent letters to Congress reporting his action, explaining the reason therefor, and inviting Congress to reject or restrict his action and to provide alternatives. Neither time did Congress act.

Although Truman framed the controversy mainly in terms of the strike’s impact on the war and defense effort, he diluted the force of his message by also pointing to an economic justification for his action. The rapid build-up of the defense effort during the Korean War followed the huge post-World War II drawdown in defense expenditures. The defense budget for the three fiscal years before 1951 averaged $13 billion each but quadrupled for the next three years. The resulting large increase in the demand for steel for military equipment strained the capacity of U.S. steel manufacturers. Combined with the continuing and increasing demand for steel for consumer goods and the rising incomes of consumers, the President and a Senate committee asserted that these inflationary pressures presented a grave danger to the economy.

The response to this perceived economic threat was, typical of government, to create more government. The World War II-era Wage Stabilization Board was still in business and was joined by a re-authorized Office of Price Stabilization. Those two agencies originally were in charge of controlling economic dislocations caused by World War II, as the civilian economy shifted to a war-time footing. Allegedly, the remaining civilian workers and the various affected businesses might seek to “profiteer” from scarcities in skilled labor and consumer goods, respectively, to demand higher prices for their services and products.

In this particular instance, the union’s demand for their desired wage increase was approved by the Wage Stabilization Board. The steel companies were not opposed to the wage hike, as such, but wanted to get the approval of the Office of Price Stabilization to allow price increases to cover the increased labor costs. The Truman administration, through that office, was willing to allow only a partial increase, which the companies considered insufficient. Thus, the strike was on. Truman, of course, blamed the steel companies, not the government’s ill-conceived attempt to politicize the workings of the economic market or its unwillingness to raise taxes needed to pay the “inflationary” price and reduce its impact.

The companies went to federal court to enjoin the government—as the new “owners” of the steel mills—from granting the union’s wage demands. The judge agreed, but his order was stayed by the U.S. Court of Appeals. Both sides (the companies and the government) then sought to bypass the Court of Appeal and obtain immediate review by the U.S. Supreme Court. That court issued its ruling on June 2, less than two months after Truman’s initial seizure order.

The decision was 6-3. Each member of the majority wrote an opinion. The unified dissent authored only one, by Chief Justice Fred Vinson. This chaos exposes the difficulty of finding enduring legal principles to decide concrete cases that are intimately connected to the shifting political events giving rise to them. The problem is the structure and language of law. Law seeks to define basic rules of how the game of human interaction within a civilized society is to be played. In that vein, it seeks to provide predictability, constancy, knowability, and transparency. Its basic mechanism to seek “truth,” the courtroom trial, is epistemologically highly formal. Ultimately, it declares a clear winner and loser. Law relies on the inertia and strength of precedent and experiential tradition. Law’s language often appears stilted, because its words must have, as much as possible, precise meaning to signal to others what are their enduring rights and obligations.

Law, then, operates in precisely the opposite manner from politics. Using these guidelines, constitutional “law” works best when resolving basic issues of express individual rights, such as whether the police had probable cause to arrest, whether a statute in fact constitutes an ex post facto law, or whether a university regulation violates the First Amendment because it goes beyond simply forbidding incitement to violence. It is not useful as a tool to resolve essentially political questions. Political resolutions generally seek compromise and accommodation and avoid finding clear winners and losers. Political resolutions are only as permanent as the parties desire. Knowability of the precise deal made is secondary. It is often the existence of words, not their substance, that matters. At the least, words in a political accord are malleable and more likely intended from the outset to be interpreted as each party sees fit at any time. Finally, reflecting the aphorism often attributed to the Prussian chancellor Otto von Bismarck, “Those who like legislation and sausages should watch neither being made,” transparency is, if anything, to be shunned.

The nominal opinion for the Court was written by Justice Black. It is the custom of the Supreme Court that the Chief Justice assigns the writing of the formal opinion, taking into considerations various factors, including existing workload of the various justices, distribution of interesting and tedious cases, expertise in the particular topic at hand, institutional importance, and ideological coalition-building. If the Chief is on the dissenting side, the longest-serving associate justice assigns the writer. In the Steel Seizure Case, Chief Justice Vinson dissented, and Black, as the senior associate justice, assigned the opinion—to himself. Black delivered a rather formalistic examination of the constitutional text and the doctrine of separation of powers. Most of the concurring justices rejected that approach as too inflexible and stilted, even if they professed to concur in it.

Of the many opinions in the fractured majority, Justice Robert Jackson’s is the most enduring. He had been FDR’s Attorney General. He acknowledged that his experience influenced his views more than “conventional materials of judicial decision which seem unduly to accentuate doctrine and legal fiction,” a none-too-subtle jab at the opinion of Black, whom he disliked intensely. Jackson, like Justice Felix Frankfurter in another concurring opinion, recognized the difficulty of providing legal structure in matters that are ad hoc, often arise in crisis mode, and do not readily lend themselves to grand categorical resolution. “The actual art of governing under our Constitution does not and cannot conform to judicial definitions of the power of any of its branches based on isolated clauses or even single Articles torn from context,” another barb directed at Black’s opinion. In its objective of securing liberty, the Constitution diffuses power, yet also expects that the dispersed powers will be integrated into a workable government: “It enjoins upon its branches separateness but interdependence, autonomy but reciprocity. Presidential powers are not fixed but fluctuate, depending upon their disjunction or conjunction with those of Congress.”

Jackson thus identified the tension between the purpose of law, including the Constitution as a “legal charter,” to provide a fixed structure for the resolution of controversies, and the inherent fluidity of the political realm within which Congress and the President interact. Jackson’s next step (discussed in the following post) attempted to provide a durable framework to diminish that tension and to prevent either branch—but most likely the President—from gaining the upper hand to “go it alone.” The difficulty of that task for any judicial body is well-summarized in a mocking sentence from the Chief Justice’s dissent: “The diversity of views expressed in the six opinions of the majority, the lack of reference to authoritative precedent, the repeated reliance upon prior dissenting opinions, the complete disregard of the uncontroverted facts showing the gravity of the emergency and the temporary nature of the taking all serve to demonstrate how far afield one must go to affirm the order of the District Court.”

An expert on constitutional law, Prof. Joerg W. Knipprath has been interviewed by print and broadcast media on a number of related topics ranging from recent U.S. Supreme Court decisions to presidential succession. He has written opinion pieces and articles on business and securities law as well as constitutional issues, and has focused his more recent research on the effect of judicial review on the evolution of constitutional law. He has also spoken on business law and contemporary constitutional issues before professional and community forums. Read more from Professor Knipprath at: http://www.tokenconservative.com/.

Click Here to Read More Essays From This Year’s 90 Day Study!

2 replies
  1. Ralph Howarth
    Ralph Howarth says:

    Just goes to show that a court decision is not law and that the misnomer of “Case Law” is actually a patchwork of case opinions. Common Law purports Stare Decisis which means in Latin to “Let the decisions stand” so that courts hopefully will be consistent in how the make rulings. But a court ruling essentially is only to curtail whether or not a defendant suffers harm from a law. After that, the court issues its legal opinions on how the members of the court arrived at that decision. Given another time or jurisdiction of similar circumstances, and the decision may go in the opposite direction, and a lessor court somewhere else may very well make a contrary decision and opinion.

    Reply
  2. Joseph R. Harrah
    Joseph R. Harrah says:

    Thank you for the great information in this essay. I have little education in the “legal” realm, but I have some understanding of how “case law” works. To me, it is like hiring a carpenter to build a house.

    The plans call for 500 boards, 8 feet in length. The carpenter marks the first board with a tape measure and a pencil and he saws it off to length. He then puts away the tape measure. He sets the first board on top of the second board and draws the line to match the first. He then puts the first board on the stack of finished pieces, cuts the second board on it’s mark, then lays the second board on the third, draws a line, cuts, lays the second board on the stack and continues this process 500 times over.

    When the 500th board is laid on the stack of finished pieces, it is not even close to the desired 8 foot length. In fact, the whole stack is random in length and the house will not be a square, strong or sound. It will be an embarrassment to the owner.

    Wouldn’t “Law” be a precise thing if it followed a bedrock standard instead of being slightly amended over and over to reflect the outcome of previous cases which may or may not have actually had a “just” outcome?

    Reply

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *