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  • Writer's pictureMarc Johnson

2012 Wildcard


Elections and the Court

When the Obama Justice Department announced last week that it had asked the United States Supreme Court for an expedited review of the Affordable Care Act (ACA) – Obamacare, health care reform, etc. – the government’s lawyers confidentially predicted that the current court would uphold the law. In making that claim the Justice Department cited several precedents in our history where the Supreme Court has reviewed and upheld once controversial laws that have now become established features of American life.

“Throughout history,” the Department said in a statement, “there have been similar challenges to other landmark legislation, such as the Social Security Act, the Civil Rights Act and the Voting Rights Act, and all of those challenges failed. We believe the challenges to the Affordable Care Act — like the one in the 11th Circuit — will also ultimately fail and that the Supreme Court will uphold the law.”

The Justice Department release represents more than a little wishful thinking and an even larger dose of selective historical memory. At least once before, in a case that has some striking parallels to what is unfolding with the Affordable Care Act, the Supreme Court considered and struck down major provisions of a Democratic administration’s domestic agenda. It happened in 1935 and the political fallout, the subsequent election campaign and the president’s policy response produced the greatest Constitutional confrontations since the Civil War.

Franklin Roosevelt signed the National Industrial Recovery Act (NIRA) into law on June 16, 1933. The law created, among other things, the National Recovery Administration, symbolized by the “blue eagle” that appeared on signs in store windows, in propaganda-like newsreels and in vast demonstrations staged in major U.S. cities.

The NIRA granted to the president vast powers – unprecedented really – to promulgate industrial codes of fair competition. The effect was to form industrial cartels that were not suppose to engage in price fixing, but came very close to doing just that, as well as turning the capitalist concept of competition on its head.

The code provision had been controversial, particularly in the Senate, where some legislators who abhorred “monopoly” – senators like Borah of Idaho and Wheeler of Montana – were concerned the law essentially did violence to the Sherman Antitrust Act, a law on the book since 1890.

The NIRA also established rights to collective bargaining, regulated working conditions and some wages and, in a separate section, created the Public Works Administration (PWA), the major infrastructure investment vehicle of the New Deal.

There were many problems administering the complex NIRA and the inevitable legal challenges began almost immediately. Eventually on May 27, 1935, a unanimous U.S. Supreme Court ruled major parts of the NIRA unconstitutional. Roosevelt was stunned and outraged, even though FDR’s Justice Department, like Barack Obama’s Justice Department with the health care legislation, had tried to pick the case and the timing to take the issue to the nation’s highest court.

Writing for a united Court, that like today’s Court frequently found itself sharply divided between conservatives and liberals, Chief Justice Charles Evans Hughes, zeroed in on Constitutional problems with two features of the law that FDR considered the centerpiece of the domestic agenda he hoped would lift the economy out of the Great Depression. Like the arguments around the Affordable Care Act, the issue in 1935 was the Commerce Clause of the Constitution.

As Hughes wrote, “If the commerce clause were construed to reach all enterprises and transactions which could be said to have an indirect effect upon interstate commerce, the federal authority would embrace practically all the activities of the people, and the authority of the State over its domestic concerns would exist only by sufferance of the Federal Government.” Sounds a lot like the arguments over the health care bill’s individual mandate provision.

The ruling in the Schechter Poultry Corporation case that brought down the NIRA is today generally considered a very narrow 1930’s interpretation of the Commerce Clause and FDR certainly thought so. He famously complained to a room full of reporters gathered in his office that the Supreme Court had adopted a “horse and buggy” view of the nation’s economy and particularly of interstate commerce. The Commerce Clause is at the heart of the ACA debate because critics charge a central federal government has no business mandating that individuals must purchase health insurance. We’ll see. 

It would be unfair to stretch the parallels between 1935 and 2011 too far and it is possible the Supreme Court my opt for an artful dodge to avoid deciding the health care case before next year’s election. It is also true that we live in vastly different times, although the politics around the Great Depression feel a good deal like the politics around the Great Recession.

Since 1935, the Court has vastly expanded our understanding of what constitutes interstate commerce and the ruling Roosevelt disliked so much came more than a year before he sought re-election to a second term. Barack Obama, by contrast, may get his ruling on the Affordable Care Act smack dab in the middle of his re-election effort and, while the NIRA was controversial it had little of the polarizing political impact of health care.

After his initial “horse and buggy” zinger had been delivered, Roosevelt generally avoided mentioning the Court, while he privately seethed about the “nine old men” who had dismantled his handiwork in the midst of a national economic crisis. Once safety re-elected in 1936 Roosevelt came down on the Court with a ton of bricks, serving up his ill-fated plan to “pack the court” by adding up to six new justices who would presumably liberalize a reactionary court. The Congress refused to go along with such an overreach and Roosevelt suffered a massive defeat right on the heels of winning a second term in a landslide.

One way or the other, Obama looks to get his chance to be pleased or disappointed by the Supreme Court in the middle of a high stakes campaign season. Most Court analysts say they count four votes in favor of upholding the controversial law and four against. Obama may think about issuing a quick invitation for a golf game to Justice Anthony Kennedy. By all accounts he’ll decide the fate of the Affordable Care Act.

There is one more historical footnote related to the 1935 case that, if he’s thought about it, might well give former law professor Obama some political heartburn. In 1935 the most liberal member of the Supreme Court was the venerated Justice Louis Brandeis, who history records as one of the all-time great justices. Roosevelt was stunned when the man he called “Isaiah” ruled against him.

Robing up before the Court delivered its decision on the NIRA, Justice Brandeis told Roosevelt aide Tommy Corcoran, “This is the end of this business of centralization, and I want you to go back and tell the president that we’re not going to let this government centralize everything.”

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