United States v. Carolene Products Co. (1938)
United States v. Carolene Products Co. 304 U. S. 144 (1938)
If you concede the constitutionality of the administrative state, where does that leave citizens’ liberties? That is, if you claim(some might say pretend) that the United States Constitution authorizes unelected, tenured officials the power to frame, enforce, and adjudicate laws you grant a privilege that looks very much like the abrogation of the Constitution’s separation of powers, brushing aside Thomas Jefferson’s maxim that the accumulation of these powers in one set of hands is the definition of tyranny. Under these circumstances, how will citizens’ liberties be protected? Who will do it? This is the question addressed in the Carolene Products case–specifically, in the fourth footnote to the majority opinion, written by Justice Harlan Stone. It has been described as the most famous footnote in the history of the Court.
The decision makes no sense, however, without an understanding of the political climate in which it came about. After the 1929 stock market crash, the Great Depression caused an unprecedented economic and political crisis in the United States and around the world. What made the Great Depression “great” was its sheer extent and duration. Americans had seen bank ‘panics’ and economic downturns before. But these events hadn’t lasted long, and the men who were thrown out of work as a result of them received relief from local governments, charities, and family members. The scale of the Great Depression overwhelmed these local supports.
To the astute politician, crisis means opportunity, and there was no more astute politician in the country than New York’s Governor Franklin D. Roosevelt, the Democratic Party nominee opposing beleaguered President Herbert Hoover in the 1932 election. Speaking to the Commonwealth Club in San Francisco, Roosevelt delivered the rhetorical masterstroke of the campaign. “The day of enlightened administration has come,” he announced. His cousin Theodore had tried to meet the problem of overbearing financial and industrial power by busting the trusts, FDR said, but that didn’t work. A steadier means of control was needed. In justifying his proposed new regime of “enlightened administration,” he slyly distorted the Declaration of Independence, saying,
“The Declaration of Independence discusses the problem of Government in terms of a contract. Government is a relation of give and take, if we would follow the thinking out of which it grew. Under such a contract rulers were accorded power and the people consented to that power on consideration that they be accorded certain rights. The test of statesmanship has always been the redefinition of those rights in terms of a changing and growing social order.”
Notice that FDR makes no mention of the Laws of Nature and of Nature’s God endowing certain unalienable rights to all men, who are created equal with respect to these rights. FDR defines rights as purely civil, arising from human agreement–consent formalized in a contract or written constitution. Government no longer secures rights we already have, as human beings; rights are “accorded” to us by, well, ourselves by means of a contract between rulers and ruled. This implies that there is one class, the rulers, and another class, the rest of us, instead of one sovereign people, under God.
As one might suspect, Roosevelt had someone, and something, very specific in mind when it came to a statesman who would redefine Americans’ rights “in terms of” social change. Given the Depression, “We must restrict the operations of the speculator, the manipulator, even the financier. I believe we must accept the restriction as needful, not to hamper individualism but to protect it.” As it happened, Herbert Hoover had published a book in 1923 titled American Individualism, a statement of the ‘old’ individualism founded on equal, unalienable rights and the Constitutional rights which secured the property which enables us to secure our lives, fortunes, and happiness. But when “private initiative has failed,” Roosevelt now replied, the federal government should “assume the function of economic regulation as a last resort.” In his 1933 Inaugural Address, the triumphant new president called upon Congress to grant him executive powers “similar to those necessary in time of war.” With such executive powers in hand, power exercised by an administrative state lodged within the executive branch and staffed initially by Roosevelt appointees, who would enjoy lifetime tenure, the American republic could truly be said to have changed from the commercial and democratic republic of the Founders to what Aristotle and Cicero would have recognized as a ‘mixed’ regime, consisting of an elected, bicameral legislature but also an increasingly kinglike presidency and an obviously ‘aristocratic’ administrative apparatus, soon to be called a ‘meritocracy.’ Throughout his four terms in office, Roosevelt often cast his revolution as ‘conservative’–an effort to preserve individual rights, capitalism, and constitutionalism under conditions of crisis in an industrialized society which had left the agrarian way of life Jefferson loved far behind. This of course assumed that the existing regime and its constitution could not have sustained American rights.
FDR had cooperation from New-Deal Democrats in Congress, elected with him in the 1932 landslide. The centerpiece of the New Deal legislative agendum was the National Industrial Recovery Act of 1933, which gave the President the power he’d requested to fight the economic ‘war.’ Not only did this cede legislative power to the presidency and ‘his’ bureaucracy, it also gave corporations and trade associations substantial influence over the regulations enacted by the National Recovery Administration, even as it left the enforcement of those regulations to the federal government. Although President Hoover had experimented with a much weaker version of this arrangement, the NIRA initiative began the extensive collaboration between presidents, federal administrative agencies, major corporations and labor unions seen to this day.
But not without initial resistance from the Supreme Court, which ruled the NIRA unconstitutional on the grounds that executive power must not expand by legislative-branch delegation of lawmaking power to presidents or administrative boards. To FDR’s dismay, even the progressive-liberal justices Benjamin Cardozo, Louis Brandeis, and Harlan F. Stone concurred. In prefaces to the several volumes of his collected papers, published a few years later, Roosevelt told his side of the story. “Commencing in 1935, and running down to the election of 1936, there came a line of decisions from the Supreme Court (and from the lower Federal Courts) which so limited the powers of the Federal Government and the powers of the State Governments to obtain the legitimate objectives for which the people voted at the polls in 1932 and 1934, that all real progress toward those objectives began to appear impossible.” “Legitimate” means “lawful,” but of course that was the point in question. Since the Supreme Court says what the law is, Roosevelt moved to change the Court in order to change how it defined the supreme law of the land. In this, he and his fellow-Democrats were quick to decry “government by judiciary,” and a Depression-weary electorate responded by returning Roosevelt and his allies to power in 1936 in an even bigger landslide than the one which had brought them into office four years earlier.
Thus fortified, in his 1937 Message to Congress Roosevelt pounced. “The vital need is not an alteration of our fundamental law”–Constitutional amendment might be time-consuming and politically risky–“but an increasingly enlightened view with reference to it–that is, “a liberal interpretation” or “broad interpretation” of the law itself. Or, as he put it rather more boldly in the 1941 preface to the sixth volume of his collected papers, “For two decades [that is, beginning in the second term of the Wilson Administration] the Supreme Court of the United States had been successfully thwarting the common will of the overwhelming majority of the American people; and had been diverting the functions and philosophy of government into channels which run counter to the thought of progressive opinion throughout the modern civilized world,” laying its “dead hand” on the “whole program of progress,” and indeed acting like a “super-legislature.” To fight back on behalf of American public opinion and progressive world opinion, FDR proposed his soon-to-be-notorious “Court-packing” plan, which would have empowered the president to appoint an additional Justice (up to six) for every member of the Court aged 70 or older. This would have given him the new appointments he needed to uphold New Deal legislation. Comparing the three branches of the federal government to a three-horse team, one of which stubbornly pulled in the wrong direction, he took his case to the people in a March 1937 Fireside Chat.
He lost. Having waved away the Founders’ idea that the separation of powers presupposes not a team of horses all going in the same direction, but a system of checks and balances designed to moderate the actions of any one branch, or any two branches acting in coordination, FDR didn’t anticipate how sharply even an economically beleaguered American public might turn against a president who, effectively having acquired substantial legislative powers from a docile Congress, also proposed to take control of the judicial branch, too. Constituent mail to Congress ran 8-1 against the proposal, and even many of the old Progressives, allies of Wilson from two decades back, deserted him on this one. In desperation, Roosevelt struck a deal with John L. Lewis, head of the United Mine Workers, obtaining his support for Court-packing legislation in exchange for an agreement to tolerate strikers who illegally occupied the property of mine owners against whom they were striking. Even this support wasn’t enough; the legislation failed to pass Congress.
But, as it happened, it was enough, substantially if not formally. A few weeks after the Fireside Chat, the Court upheld a Washington State minimum wage law in West Coast Hotel v. Parrish. Decisions sustaining the National Labor Relations Act followed. New Dealers happily recalled a turn-of-the-century quip by the Irish-American humorist Finley Peter Dunne, who’d written “The Supreme Court follows the election returns.” Even more famously, they alleged, “A switch in time saves nine,” although the Court-packing plan had hurt them more than it had helped in the ‘court’ of public opinion. For himself, several years later FDR exulted, “The Court began interpreting the Constitution instead of torturing it.” Unless they had changed their tune “there is grave doubt whether [our democracy] could have survived the crisis which was bearing down upon it from within, to say nothing of the present  threat from abroad.” Whereas freedom of contract’s “old unrealistic meaning” had stifled New Deal progressivism, its new and supposedly realistic meaning was that “liberty in a social organization which requires the protection of law against the evils which menace the health, safety, morale, and welfare of the people.”
The Court had legitimated presidential and administrative lawmaking over the head of Congress, a legitimacy earlier granted by Congress itself. From now on, the United States had what amounted to a new regime.
Having tacitly ceded its power to pronounce on the constitutionality of a substantial swath of cases–those relating to contracts and other property rights–the Court needed to find a new role for itself. What would it do in the new (indeed New-Deal) administrative state? The answer came in 1938 with its decision in United States v. Carolene Products. A 1923 federal law had banned “filled milk”–a substance consisting of skimmed milk thickened with vegetable oil to make it seem like whole milk or cream. The Filled Milk Act of 1923 had been enacted at the behest of dairy farmers who objected to prices for their product being undercut with a cheaper and, as they claimed adulterated product. Carolene Products, a producer of filled milk, sued the federal government, charging that Congress had gone beyond the power of the interstate commerce clause in regulating the contents of an item sold commercially, rather than regulating the processes of commerce itself.
The Court ruled that the interstate commerce clause should be interpreted broadly, allowing federal regulation of interstate commerce so long as there was a “rational basis” for such a law–for example, the protection of the public health. Up to then, public health issues had been the province of the state governments, their powers in this area taken to be covered by the Tenth Amendment. No longer.
But more significantly, in the fourth footnote to the opinion, Justice Stone served notice that the clauses in the Constitution which entailed “a specific prohibition” against government interference–as for example the First Amendment’s stipulation that Congress shall make no law restricting freedom of speech or religion–would be protected by the Court. This protection would extend to the protection of “discrete and insular minorities”–religious, national, or racial–against any law which “tends seriously to curtail he political processes ordinarily to be relied upon to protect minorities.”
The Court thus ceded very broad powers over property to the president, the administrative state, and the Congress via a “broad” or “liberal” interpretation of the interstate commerce clause, as FDR had urged. It reserved for itself cases in which this much more powerful and centralized state might infringe on the political and civil rights of the citizens it ruled. In the decades to come, especially after the Second World War (which saw a serious breach of the civil rights of Japanese Americans upheld by the Court), civil rights cases increasingly preoccupied the justices, as they attempted to protect those rights against encroachment by the large and ever-expanding New-Deal state. At the same time, the Court availed itself of the power FDR had himself urged upon it–the power to interpret the Constitution broadly–to each states’ powers regarding civil rights, consumer protection, and a plethora of matters not directly involving property rights. The third horse of the governmental team now pulled (usually) in tandem with its partners in the direction of what the Founders would have regarded as an oxymoron or contradiction in terms: liberal statism.
United States v. Carolene Products Co. (1938) Supreme Court decision: https://supreme.justia.com/cases/federal/us/304/144/case.html
Will Morrisey is William and Patricia LaMothe Professor Emeritus of Politics at Hillsdale College, and is a Constituting America Fellow; his books include Self-Government, The American Theme: Presidents of the Founding and Civil War and The Dilemma of Progressivism: How Roosevelt, Taft, and Wilson Reshaped the American Regime of Self-Government.
Excellent essay, one of the best so far. Powerful insight into The Birth of government by regulation and the message that government, not God, grants rights.
I agree, an excellent essay. Many essays in CA over the past couple of years have shined a focused light on the birth and expansion of the Administrative State.
The shift from natural, inalienable rights to government endowed rights is sad fact. We may see a President impeached by Admin state to protect the powers the Admin states have accumulated over the years.
An interesting Executive power situation played out today when President Trump reversed President OBama’s decision to join the Paris Climate change treaty. I wondered why Trump didn’t use the Constitution. “The US is not now nor has it been part of the Paris Treaty because the US Senate has not acted on it. Thus, today I am referring the Treaty to the Senate for debate and an up or down vote. The Senate approves it then, I the President am bound by my oath to enact and enforce it. Until the Senate approves it I am bound by my oath to neither enact and enforce it.”