Part Two: The Court Attempts to Limit Commerce Clause Authority

In the Wickard case, the Agriculture Adjustment Act of 1938 (the “AAA”), one of the centerpieces of the New Deal, attempted to regulate the wheat and other agricultural markets by placing quotas on the amount of wheat that farmers could grow for sale and for home consumption. The term “market” was used to refer to the farmers’ consumption of wheat they grew on their own farms as well as the commercial transactions in wheat, even if the amounts so grown for their own use were quite small. If the farmers exceeded their quotas, penalties in the form of fines-per-bushel were imposed on farmers who grew such “farm marketing excess” wheat.

Farmer Roscoe Filburn challenged the constitutionality of the statute on several grounds, including the Commerce Clause. He argued that the AAA exceeded the power of Congress under the Commerce Clause for at least two reasons. First, conceding that Congress could regulate intrastate or local activities that had a substantial effect on interstate commerce, Filburn argued that the few excess bushels of wheat he harvested had a “trivial,” not substantial effect, on interstate commerce and was thus beyond the reach of federal regulatory authority. Second, he argued that wheat grown for his own use was not part of the commercial “market” that was the focus of the Commerce Clause.

He lost on both counts. Justice Robert Jackson, who was later Allied prosecutor at the Nuremburg War Trials after World War II, reasoned that any activity, commercial or not, that had a substantial effect on interstate commerce when taken in the aggregate with other like activity was within the scope of the federal commerce power. “But even if appellee's activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce[.]” “That appellee's own contribution to the demand for wheat may be trivial by itself is not enough to remove him from the scope of federal regulation where, as here, his contribution, taken together with that of many others similarly situated, is far from trivial.” Thus, Wickard stands for the proposition that government regulation may reach any local or intrastate activities when, taken in the aggregate, they have a substantial effect on interstate commerce.

Like its limitation upon Congress’s authority under the enforcement clauses of constitutional amendments in City of Boerne v. Flores, the Rehnquist Court also attempted to place limits on the Congress’s commerce power for the first time since the 1930s. In Lopez, the federal law at issue was a criminal statute that made it a crime to possess a firearm within 1000 feet of a school. High school senior Alfonzo Lopez was charged with violating a state criminal law when he took a concealed pistol with him to school at a San Antonio high school. The next day, the state charges were dropped and he was charged instead with violating the federal “Gun-Free School Zones Act of 1990,” which was passed by Congress pursuant to its authority under the Commerce Clause. Lopez argued that the statute exceeded the authority of Congress under the Commerce Clause because carrying a weapon has nothing to do with interstate commerce, much less a substantial effect on it.

The Court agreed. Citing Wickard, the Chief Justice Rehnquist said, “But even if appellee's activity be local and though it may not be regarded as commerce, it may still, whatever its nature, be reached by Congress if it exerts a substantial economic effect on interstate commerce.” Here, however, there was no apparent relation between gun-carrying and interstate commerce, and Congress had made no such findings. Justice Breyer, in dissent, focused on the government’s arguments that crime in general and gun crime in particular has a substantial effect on interstate commerce, but the majority rejected the argument as too tenuous to support the exercise of Commerce Clause regulatory authority in this instance. Note that state charges against Lopez were still possible because they are not based on the federal commerce power but on the state police power.

The government has made a similar aggregate economic argument in several other recent cases. In United States v. Morrison the argument was made that sexual assaults, in the aggregate, have a substantial effect on interstate commerce, particularly when such assaults deter students from continuing their education. Christy Brzonkala, a freshman at Virginia Tech, alleged that she was assaulted and raped by Virginia Tech football players. After the school disciplinary proceedings resulted in the suspension of only one of the students for only one semester, she sued the players and others, not in state court under Virginia’s common law or statutes, but in federal court under a federal civil liability statute, The “Violence Against Women Act” of 1994. The statute allowed victims of gender-based crimes to sue in federal court for damages and was an exercise of Congress’s Commerce Clause power. Note again that state law—this time, civil tort remedies—was also available, but she bypassed those actions and went straight to federal court. The defendants were not charged with crimes as of the time that Brzonkala filed suit.

The Court struck down the federal statute as exceeding the Commerce Clause regulatory power. Again, Chief Justice Rehnquist rejected the reasoning that gender-based or gender-motivated crime, individually or in the aggregate, can have a substantial effect on interstate commerce. Accepting this reasoning, he said, potentially brings all activities within the scope of Commerce Clause regulation. The government, intervening to defend the constitutionality of the statute, argued extensively that gender-based crime affects commerce, but as in the Lopez case, the causal relation between these actions and interstate commerce was too tenuous for the narrow 5-to-4 majority.

Judicial Politics

The division on the Court between justices who accept the recent limits on the Commerce Clause and those who, though acknowledging limits, have yet to find them applicable to a case before them, is one of the lines dividing “conservative” from “liberal” jurists: judicial conservatives in the twentieth and twenty-first centuries thus take a line on federal government power that is reminiscent of the Jeffersonian, limited government position. Judicial liberals tend to accept broad national legislative power, similar to the attitude of Chief Justice Marshall and the nationalists on the early Court. (There are also other significant disagreements between the two so-called “blocs” of justices.)

Sometimes, however, these tendencies are broken is a particular case. The California medical marijuana case was one such instance. California passed a law that legalized the private growing and use of marijuana for medical purposes. This law was in conflict with federal drug and controlled substances statutes and regulations. In Gonzalez v. Raich (2005), California’s Compassionate Use Act, which permitted the cultivation, possession, and use of marijuana for medical purposes came into conflict with the federal Controlled Substances Act, which prohibited the manufacture, possession, and use of marijuana. The by-now familiar argument was made by plaintiffs Raich and Monson that in regulating the private, local cultivation of small amounts of marijuana, the federal act exceeded the scope of Congress’s power to regulate commerce. The Ninth Circuit Court of Appeals ruled in favor of Raich on Lopez grounds, holding that the federal Controlled Substances Act cannot regulate the use and cultivation of small amounts of marijuana protected by California law.

The Supreme Court reversed, by a vote of 6 to 3. In Gonzales, two justices who had been in the majority in the Lopez and Morrison cases, Justices Kennedy and Scalia, joined the judicial liberals in upholding the federal statute and invalidating the provisions. The majority relied principally on the reasoning of Wickard v. Filburn, which it found “of particular relevance.” Like the Agricultural Adjustment Act in Wickard, which regulated the nation’s agricultural industry in the United States, the Controlled Substances Act (“CSA”) and the larger Comprehensive Drug Abuse Prevention and Control Act, of which the CSA is a part, attempt to regulate a nation-wide industry, the drug and pharmaceutical industry. Justice Kennedy joined the majority opinion. Justice Scalia concurred in the judgment (agreed with the Court’s judgment but disagreed with the majority’s rationale for it), emphasizing that the regulation of the nation’s pharmaceutical industry is a legitimate exercise of the commerce power and that the regulation of manufacture and possession of marijuana is a necessary and appropriate part of that regulatory scheme.

Finally, the Patient Protection and Affordable Care Act, commonly known as “Obamacare,” includes a provision called the individual mandate, which requires individuals to purchase medical insurance or be subject to a penalty for not doing so. This provision was challenged on several grounds, one of which was that it exceeded the scope of the Commerce Clause authority by not only regulating activities that had a substantial effect on interstate commerce but by requiring individuals to engage in such activities. The government unsurprisingly relied upon the reasoning of Gonzales and Wickard for justifying this power over individuals, but a majority of the Court rejected this argument. In Chief Justice Roberts’s words:

The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce. Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority.

Dissenters Scalia, Kennedy, Thomas, and Alito echo this thought:

It is true that, at the end of the day, it is inevitable that each American will affect commerce and become a part of it, even if not by choice. But if every person comes within the Commerce Clause power of Congress to regulate by the simple reason that he will one day engage in commerce, the idea of a limited Government power is at an end.

To broaden the already expansive scope of Commerce Clause regulation to include this kind of regulation was not acceptable to a majority, although four justices—Ginsburg, Breyer, Sotomayor, and Kagan—dissented.

The National Federation of Independent Business Case

The NFIB case is an interesting exercise in Supreme Court “nose-counting.” There is reason to believe that the original lineup of justices on the issues of the case was different from the final. The merits of the case included constitutional challenges to two of the provisions of the Act: (1) the individual mandate and (2) the requirement that states expand their Medicaid programs’ coverage or suffer the withholding of federal funds. All justices except Ginsburg and Sotomayor agreed that the provision that threatened the withholding of federal Medicaid funds from states that refused to expand their programs was unconstitutional. But the opinions on the individual mandate were not so simple.

The summary of the justices’ positions that precedes Chief Justice Roberts’s opinion is complex:

ROBERTS, C. J., announced the judgment of the Court and delivered the opinion of the Court with respect to Parts I, II, and III–C, in which GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined; an opinion with respect to Part IV, in which BREYER and KAGAN, JJ., joined; and an opinion with respect to Parts III–A, III–B, and III–D. GINSBURG, J., filed an opinion concurring in part, concurring in the judgment in part, and dissenting in part, in which SOTOMAYOR, J., joined, and in which BREYER and KAGAN, JJ., joined as to Parts I, II, III, and IV. SCALIA, KENNEDY, THOMAS, and ALITO, JJ., filed a dissenting opinion. THOMAS, J., filed a dissenting opinion.

The Chief Justice’s opinion that the individual mandate was not a valid exercise of the federal commerce power (Part III-A of his opinion) was mirrored in the dissent of Scalia, Kennedy, Thomas, and Alito, but these justices did not join in Part III-A of Roberts’s opinion nor did they indicate that they concurred in this part of Roberts’s opinion. Such an indication of concurrence is the usual practice. Nor did these four justices indicate that they concurred in the judgment or the opinion that the withholding of Medicaid funds was unconstitutional (Part IV), yet they argued that the withholding provision was indeed unconstitutional. Like their opinion on the individual mandate, their opinion that the withholding of Medicaid funds was unconstitutional was simply spelled out in their dissent. The Court’s judgment that the Medicaid withholding provision was unconstitutional depends upon their “dissenting” opinion for its majority! It was also unusual that the dissent was “signed” by—attributed equally to—all four of them instead of the more common practice of one justice authoring a dissent and being “joined” by others, exemplified by Ginsburg’s opinion.

On the other hand, Justice Ginsburg, joined by Breyer, Sotomayor, and Kagan, expressly dissented from Robert’s Commerce Clause reasoning on the individual mandate (Part III-A). The four did not indicate agreement or disagreement with Roberts’s argument that the individual mandate might be considered an exercise of the federal taxing power (Part III-B), but they did concur in his holding that the individual mandate was constitutional as an exercise of the taxing power (Part III-C). (Ginsburg and Sotomayor would have upheld the Medicaid withholding provision; Breyer and Kagan concurred with Roberts’s holding that it was not constitutional. In short, Ginsburg and Sotomayor would have upheld both challenged sections of the Act; Breyer and Kagan only joined Ginsburg’s opinion on the individual mandate.)

The summary of the justices’ positions that precedes Roberts’s opinion, together with the separate opinions by Breyer and Ginsburg, indicates that apparently none of the justices joined or concurred in Roberts’s opinion (Part III-A) that the individual mandate exceeded Congress’s authority under the Commerce Clause. But the opinion of Scalia, Kennedy, Thomas, and Alito regarding the individual mandate was quite similar to Roberts’s and concludes, with Roberts, that the mandate exceeds Congress’s Commerce Clause authority. Whether the Commerce Clause reasoning of Roberts and the four dissenters—Scalia, Kennedy, Thomas, and Alito—is similar enough to establish it as precedent is questionable because the dissenters did not explicitly concur in Roberts’s reasoning or join that part of his opinion. One might have expected the dissenters’ opinion, like Ginsburg’s opinion, to be labeled “concurring in part and dissenting in part,” or some such language, but it was simply labeled a “dissenting” opinion. If we disregard the “concurring” and “dissenting” labels, the opinions in this case are reminiscent of the seriatim opinions of the early Court.

Since Breyer, Sotomayor, and Kagan joined the part of Ginsburg’s opinion concurring in Chief Justice Roberts’s holding that the individual mandate was a constitutional exercise of the taxing power, this taxing power rationale may be used as precedent in future cases because a majority of the justices expressly agreed that the individual mandate was constitutional as a tax.

A different majority held that the Medicaid withholding provision was invalid: Chief Justice Roberts; Justices Breyer and Kagan, who concurred in that part of Roberts’s opinion; and Scalia, Kennedy, Thomas, and Alito, who indicated in their dissent that they thought the provision was unconstitutional. Whether there is a common rationale for the invalidation that can serve as precedent depends on the similarity of Roberts’s opinion and the four dissenters’ opinion.

Some have speculated that the Chief Justice was originally of the same mind as the four dissenters—Scalia, Kennedy, Thomas, and Alito—but that for some reason he decided to go his own way in reasoning that the individual mandate was a valid exercise of federal taxing power. The odd thing is that the aforementioned dissenters did not follow the usual practice of indicating that they “concurred in part and dissented in part” with Roberts’s opinion. As Alice would say, “Curiouser and curiouser!” Perhaps one of the justices, after retirement (or, more likely, one of the clerks after moving on to richer pastures), will shed some light on what transpired at 1 First Street, N.E., when the Court was deciding NFIB v. Sibelius.