NEW DEAL (Constitutional Significance)

the new deal era was a time of extraordinary constitutional ferment, witnessing significant constitutional change in a strikingly wide variety of areas. Just as the Supreme Court was evincing increasing solicitude for civil rights and civil liberties, particularly in the realms of freedom of speech and criminal procedure, the Justices substantially eroded the doctrine of intergovernmental immunity from taxation, dramatically relaxed the restraints imposed upon state governments by the contract clause, and sanctioned a major reorientation of monetary policy. At the same time, the executive branch emerged with significantly enhanced authority in both domestic and foreign affairs. Yet the expansions of the powers of Congress to regulate interstate commerce and to spend for the general welfare, along with the demise of economic substantive due process of law, are generally regarded as the period's signal contributions to the modern American constitutional landscape.

Of these three, developments in the taxing and spending power jurisprudence were arguably the least significant. To be sure, the Court's embrace of the Hamiltonian interpretation of the spending power, announced in united states v. butler (1936) and confirmed in the Social Security Cases, freed future Congresses from concern that the power to spend was limited to ends identified in the other enumerated powers of Article I, section 8. Yet federal grants-in-aid to states and municipalities, widely employed in such New Deal programs as the Public Works Administration, were already a well-established feature of American "cooperative" federalism. Moreover, exercises of the spending power could easily be insulated from judicial review under the taxpayer standing doctrine announced in frothingham v. mellon (1923). So long as Congress appropriated the funds to be spent from general revenue rather than from an account funded by a particular tax, no taxpayers had standing to challenge the propriety of the expenditure. While the New Deal ushered in the modern welfare state with its dramatic increases both in the volume of federal expenditures and in the purposes to which Washington's largesse was directed, such congressional capacity was already latent in the structure of contemporary constitutional doctrine.

Indeed, the American constitutional order on the eve of the Great Depression was hardly an unregulated regime of laissez-faire. By 1930 the Court had already upheld a vast array of state police power statutes, including regulations of working hours and child labor, worker's compensation statutes, wage and payment regulations, utility and price regulations, and state antitrust laws. Far more notorious, however, were cases in which the Court had invalidated a workplace or price prescription on the ground that it interfered with the freedom of contract or applied to a business that was not "affected with a public interest." The hughes court excised these closely related substantive due process doctrines from the constitutional lexicon, upholding extensive legislative control of wages, prices, and collective bargaining. Henceforth "regulatory legislation affecting ordinary commercial transactions" would enjoy a virtually irrebuttable presumption that it provided due process of law. In tandem with contemporaneous developments in commerce clause jurisprudence, these decisions cleared the remaining impediments to the emergence of the modern regulatory state.

Federal regulation of the economy was of course not a New Deal innovation. By 1930 the Court had already sanctioned extensive regulation of business practices in interstate commerce, upholding initiatives ranging from the federal trade commission act and federal antitrust laws to the pure food and drug act. The Court had similarly approved extensive federal supervision of the railroad industry, stamping its imprimatur on not only the interstate commerce act, but the Federal Employers Liability Act, the Safety Appliance Act, and the Railway Labor Act as well. Under the shreveport doctrine, federal regulatory power over the railroads extended even to intrastate activities when they bore a "close and substantial" relation to interstate commerce. Such "local" activities as mining, manufacturing, and agricultural production were typically held to affect interstate commerce only "indirectly," and were thus frequently beyond congressional control. However, even local activities such as transactions in stockyards and on grain exchanges could be reached by Congress if they were situated in a "current" or "stream" of interstate commerce. Under both the Shreveport doctrine and the current of commerce doctrine, however, federal regulation of local enterprise was limited by the due process requirement that the business regulated be, like railroads, stockyards, and grain exchanges, "affected with a public interest."

Two events of the New Deal period dramatically expanded the scope of federal power. First, by lifting the "affected with a public interest" limitation in due process jurisprudence, the Court allowed more general application of commerce clause precedents previously restricted to a handful of enterprises. This development opened new opportunities for federal regulation of such domains as industrial labor relations and the agriculture and energy sectors. Second, by 1942 the Court had explicitly retired the old local/national and direct/indirect dichotomies that had framed commerce clause jurisprudence for more than half a century. The consequences of this abandonment were twofold. First, a plenary commerce power under-wrote unprecedented expansion of both the national administrative state and the role of federal law in daily life. Much of the nation's economic activity would become subject to the jurisdiction of regulatory agencies, and the commerce power eventually became the vehicle of choice for federal oversight of everything from civil rights to street crime. Second, because these old distinctions had also been central to dormant commerce clause jurisprudence, their exile from the affirmative commerce clause context prompted the Court to reformulate the clause's negative implications. In years to come such cases would focus not on whether the activity regulated was "local" or the regulation affected commerce "directly," but rather on whether the state or local government was discriminating against or unduly burdening interstate commerce. Decoupling affirmative and dormant commerce clause doctrine served to prevent omnicompetent federal power from implicitly obliterating state and local regulatory prerogatives.

Recent years have seen a revival of academic interest in the New Deal. Central to the lively scholarly discussion has been the question of how best to characterize the period's constitutional development. Some scholars see an abrupt constitutional "revolution" in 1937; others claim a more gradual "transformation" began earlier in the decade (if not earlier in the century) and concluded in the early 1940s. Some see in this development a "rediscovery" of the Constitution after a period of activist corruption, whereas others view it as a mistaken departure from established and appropriate constitutional norms. Where some detect a "translation" or adaptation of the Constitution to changed circumstances, still others observe a shift in interpretive practice that transformed the very meaning of constitutional adaptivity. One prominent scholar contends that the Constitution was actually "amended" outside the procedure specified by Article V when the Court forged new constitutional law in response to the will of the people expressed in the "critical election" of 1936. The debate has taken on greater urgency in an era of political and judicial retrenchment, as some commentators seek not only to describe the change, but also to legitimate and draw prescriptive force from it. Yet beneath these differences in characterization rests a consensus that the New Deal era was the principal constitutional watershed of the twentieth century.

Barry Cushman
(2000)

(see also: Amendment Process (Outside of Article V); Constitutional History, 1933–1945; Roosevelt, Franklin D.)

Bibliography

Ackerman, Bruce 1998 We the People: Transformations. Cambridge, Mass.: Harvard University Press.

Cushman, Barry 1998 Rethinking the New Deal Court: The Structure of a Constitutional Revolution. New York: Oxford University Press.

Friedman, Richard D. 1994 Switching Time and Other Thought Experiments: The Hughes Court and Constitutional Transformation. University of Pennsylvania Law Review 142: 1891–1984.

Lessig, Lawrence 1995 Understanding Changed Readings: Fidelity and Theory. Stanford Law Review 47:395–472.

Leuchtenburg, William E. 1995 The Supreme Court Reborn: The Constitutional Revolution in the Age of Roosevelt. New York: Oxford University Press.

White, G. Edward 1997 The "Constitutional Revolution" as a Crisis in Adaptivity. Hastings Law Journal 48:867–912.