Constitutional-Literacy-5

=**Section 5: Commerce Clause and General Welfare Clause**=

The two clauses that have expanded government the most are the Commerce Clause and the General Welfare Clause. These clauses both come from Article 1 Section 8 which lists the powers of Congress.

Section 8
1: The Congress shall have Power To lay and collect Taxes...and...to pay the Debts and provide for the common defense and general welfare of the United States...

3: To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;

The General Welfare Clause is the claimed source of authority for all entitlement spending (Social Security, Medicare, Medicaid, welfare, unemployment, disability, etc). It is also the "source" of federal mandates on state governments, which are rules and regulations that the federal government requires the states to follow at the expense of the states. These unfunded mandates (not funded by the federal government but the states have to abide) help to cause problems for state budgets. An example is regulation of the schools. There are several requirements that the federal government requires the states to follow as well as local school districts, yet the federal government doesn't fund all of these mandates. It's a subtle way to control the schools from the federal level. This same principle applies to other areas as well, not just education.

The Commerce Clause is the source of federal regulations on businesses, agriculture, mining, and medical care (although the 2012 ruling on the Affordable Care Act, a.k.a. Obamacare ruled that the federal government couldn't force individuals to purchase health care based on the Commerce Clause, but allowed the federal government to do so under the power to tax - those who don't purchase health care will be a tax officially - the language in the bill called it a fine).


 * Comprehension Question: Which clause is used to pass the most laws for spending and which clause is used to pass most laws dealing with regulations?**

It's important to understand that if both of these clauses were used as originally intended, there'd be no national debt, far lower taxes at the federal level, and there would be "anorexic" federal spending. If these clauses were applied as originally intended, entitlements, education, environmental issues, and numerous other areas would be state by state issues to deal with.

How did Congress get such an expansion in power? There were two major Supreme Court cases in which the Supreme Court opened the door for federal government expansion of its authority.
 * Schechter Poultry Company v. United States 1935: This case was nicknamed the "sick chicken case." It got to the Supreme Court because the federal government was regulating the chicken processing industry. One provision of the regulations said that when companies bought chickens, they couldn't separate healthy and sick chickens - they had to buy the whole lot. The Schechter Company was prosecuted for violating this rule. It went through the federal court system. The FDR Administration said there were two parts in the National Industrial Recovery Act that justified the law through Congress's power to regulate interstate commerce - the code that governed the processing of chickens and the minimum wage and hour regulation for employees of the company. The case question was does the Commerce Clause give Congress the power to regulate chicken processing and set a minimum wage for companies? The Supreme Court ruled that the federal law was unconstitutional basically saying that if the federal government were allowed this power, then the federal government would have almost unlimited power. This was the correct interpretation of the Commerce Clause - that the federal government doesn't have unlimited power, that Congress can't create a centralized government, and there is to be no conflict with state power. So, what went wrong? The Supreme Court got it right by defining interstate commerce as the start of shipping to the end of shipping. The problem came when the Supreme Court said Congress can regulate those things that DIRECTLY IMPACT interstate commerce. The outcome of the Schechter Case was that laws that were previously unconstitutional could now be interpreted as constitutional since Congress could now regulate things that directly affect or impact interstate commerce. Congress's power, from this Supreme Court decision, was no longer tied to regulating ONLY interstate commerce. If an action directly impacted interstate commerce, now Congress could regulate that action. Congress would, therefore, start to use the Commerce Clause using the new direct affects test controlling things that were meant to be state jurisdiction. NOW, Congress just has to show that a law impacts commerce, even if such a law doesn't deal with the physical shipping of a good across state lines. Since this case, the number of federal regulations over business has increased year by year.
 * In 1990, Congress passed a law that said no guns in schools, even though states already had such laws. In 1992, Alfonzo Lopez brought a gun to his Texas school. He was arrested and the feds came in. It went to the Supreme Court and the question was over the idea that it wasn't commerce, but rather regular criminal activity and therefore state jurisdiction. The resulting Lopez Test would allow three kinds of laws. (1) Laws can regulate the channels of interstate commerce - roads, rivers, airways. (2) Laws can regulate the instruments of interstate commerce - trains, boats, planes, trucks. (3) Laws can regulate economic activity that "substantially affects interstate commerce." Numbers 1 and 2 are consistent with original intent. Number 3, however, broadens Congress's power and gives Congress the ability to regulate more than originally intended, which is a way the Congress has been able to grow bigger and more powerful. The court ruled that the Congress exceeded its power of the Commerce Clause to pass the gun free school zone law. Looking at the Lopez test, bringing a gun to school doesn't fall under any of the three. This doesn't mean one could bring a gun to school or that school safety is in jeopardy because state laws say no guns. The Supreme Court might have gotten the ruling right, but like the Schechter Case they gave room for the Congress to expand its power with the 3rd part of the Lopez test.


 * Comprehension Question: Which Supreme Court case opened the door for the modern view of the Commerce Clause? What was this case's key ruling?**


 * Comprehension Question: How did this case (previous answer) increase government power?**


 * Comprehension Question: What was the ruling and the significance in the Lopez Case?**

The Congress tried to use the Commerce Clause for the 2010 health care law (Affordable Care Act a.k.a. Obamacare). The Supreme Court ruled that the Commerce Clause didn't give the Congress such authority, which is right, but did allow the law under the power to tax, which opened a different door - Congress is now able to force people to purchase health care and if they don't purchase health care they'll be taxed (rather than fined since the ruling allowed the health care mandate under the power to tax). If the government followed original intent, environmental laws, labor and business laws, and even the health care law would be unconstitutional. These areas were all meant to be state level areas. Commerce is shipping, NOT manufacturing, mining, farming, or providing health care. However, because of the "directly impact" part of the Schechter Case and the "substantially affect" part of the Lopez Case, the Congress has been able to exceed its power and increased its power into areas that were intended to be for the states.

The other clause that led to a major expansion of the government is the General Welfare Clause. Was this clause intended to allow the Congress to tax and spend on anything? The key question is can Congress spend on projects that go beyond the enumerated powers or was spending to be limited to the enumerated powers. In 1936, the Supreme Court ruled on the key case United States v. Butler 1936. It all began with the Agricultural Adjustment Act, which planned to limit farm products in order to raise prices on farm goods. There was a tax on food processing companies and the money would be used to pay farmers not to grow crops. Is Congress able to do this? Can Congress tax and spend in this manner based on the General Welfare Clause? What was the original intent? This debate was held between James Madison and Alexander Hamilton. Madison believed federal taxing and spending had to stay within the enumerated powers whereas Hamilton believed the federal government could go beyond the enumerated powers. Joseph Story was a Supreme Court justice from 1811 to 1845. He wrote a treatise on the meaning of the Constitution in which he sided with Alexander Hamilton on this matter. The 1936 Butler Case used the Story rejection of Madison's view and the Supreme Court in 1936 opened the door for massing spending and entitlements. FDR's justice department also used quotes from some of the Founding Fathers who sided with Hamilton and even Daniel Webster as well as States' Rights advocate John C. Calhoun.


 * Comprehension Question: What was the ruling in the Butler Case?**

How could John C. Calhoun have supported the Hamilton view that the federal government could tax and spend beyond the enumerated powers? The major history of Calhoun is that he was an ardent states' rights advocate believing that the states could even declare a federal law unconstitutional during the Nullification Crisis under President Andrew Jackson. Calhoun argued time and time again for the states to conduct their own matters and for the federal government to stay out of state affairs. So how could Calhoun support the Hamilton view? The answer is in the full text of what Joseph Story wrote. Story wrote that the General Welfare Clause was not meant to give Congress power to spend on anything. If they could, then the Constitution would be meaningless. The original intent was that the federal government could NOT spend on what the states were competent enough to handle on their own. NOT spend on anything the Congress wanted.
 * Comprehension Question: What is meant by the statement that the federal government could not spend on what the states were competent enough to handle on their own?**

This is why Hamilton's view was supported by a guy like Calhoun - because both believed the federal government could tax and spend beyond the enumerated powers ONLY if it was on a matter that the states were not competent enough to handle on their own. The early debate was in the early 1800s over the U.S. purchasing the Louisiana Purchase. The enumerated powers don't allow this purchase - buying territory. This is where the debate over the General Welfare Clause came up. States are denied the power of entering a treaty with a foreign nation so the states can't make such a purchase, but making this purchase isn't an enumerated power. The Louisiana Purchase was allowed by the General Welfare Clause because the states weren't competent enough to do this on their own (actually the states weren't allowed based on the Constitution). Story noted that the first vote at the Constitutional Convention was that the national government could only act in cases where the states were incompetent, a view held by Washington and Hamilton and an area Calhoun certainly agreed.
 * Comprehension Question: What was the original intent of the General Welfare Clause?**


 * Comprehension Question: Which point would Madison and Hamilton have disagreed over with this clause (remember Madison believed federal power should never go outside the enumerated powers while Hamilton believed it was okay to do so as long as areas where states weren't competent)?**


 * Comprehension Question: What areas of spending would Hamilton and Madison (as well as States' Rights advocates like Calhoun) have agreed?**

The ruling in the Butler Case said Congress could go beyond the enumerated powers, citing Hamilton, Story, and Calhoun, but the Supreme Court left out the part about only in areas were the states were not competent. This Supreme Court interpretation in Butler went beyond original intent and since the Butler Case, the federal government taxes and spends far beyond the enumerated powers and far beyond what the states are competent enough to do on their own. The states are competent enough to handle education, transportation, and welfare. However, the federal government spends a lot in these areas. The federal government handles military and space exploration - areas the states aren't competent enough to handle. Today, Congress spends a lot of money and puts forth mandates to control schools in states as well as highways, welfare, and many other areas that were intended to be state powers. When the federal government does this, it forces the states to pass laws to comply with the federal mandates. This has been allowed by the Supreme Court.

As a result of the Supreme Court not protecting the original intent of the Constitution, the U.S. Congress since the Great Depression has been able to tax and spend dramatically to the point where we have a massive government with decreasing personal liberty and a debt that is out of control. This all could and would have been avoided if the U.S. government stayed in the lines of the original intentions of our Founding Fathers. Ever since 1936, federal spending has increased each year (some administrations increased spending more than others, but the spending has increased every year since 1936).


 * Discussion Question: What would our federal government do differently if we followed the original meaning of the General Welfare Clause?**


 * Discussion Question: What would our federal government do differently if we followed the original meaning of the Commerce Clause?**


 * Discussion Question: What is wrong with Congress dictating policies to the states through the practice of placing "strings" (conditions) on federal grants going to the states?**

In 1792, the Congress was considering getting involved (passing a law and/or spending) to help the fishing industry in Massachusetts under the belief that it’s necessary so that shipbuilders and other industries in other states wouldn’t be hurt. James Madison spoke against this basically claiming it’s an abuse to the General Welfare Clause. He said if you’re going to use the General Welfare Clause to give money to anything saying “ **" **//If Congress can employ money indefinitely to the general welfare, and are the sole and supreme judges of the general welfare, they may take the care of religion into their own hands; they may appoint teachers in every State, county and parish and pay them out of their public treasury; they may take into their own hands the education of children, establishing in like manner schools throughout the Union; they may assume the provision of the poor; they may undertake the regulation of all roads other than post-roads; in short, every thing, from the highest object of state legislation down to the most minute object of police, would be thrown under the power of Congress.... Were the power of Congress to be established in the latitude contended for, it would subvert the very foundations, and transmute the very nature of the limited Government established by the people of America //."

**Overall: Summarize the main idea of this section and why it's important.**

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