Commerce Clause

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Do Now:
Take out your Venn Diagram and complete it on
the board.
Reserved Powers
Delegated Powers
Concurrent Powers
Growth of Power
• Supremacy
• Implied Powers
• Commerce Clause
Supremacy
Clause
• According to Article VI Clause 2 (“The Supremacy Clause”), the
supreme law of the land is:
• The U.S. Constitution
• Laws of the national government (when consistent with the Constitution)
• Treaties (which can only be made by the national government)
• It was a struggle at the beginning. Could the federal courts even
imposes the Supremacy Clause onto the states?
Supremacy
Martin v. Hunter’s Lessee (1816)
• Facts of the Case: Lord Fairfax, who held land in Virginia, was a Loyalist during
the Revolutionary War. He fled to England and when he died in 1781, he left his
land to his nephew, Denny Martin. The following year, the Virginia legislature
confiscated all Loyalist property. They sold a portion of the Fairfax property to
David Hunter. However, in 1794, the Jay Treaty, which was an agreement
between Great Britain and the United States, promised the British that all
property that was confiscated from Loyalists during the war would be returned.
So Martin sued Hunter for the property to which he was entitled.
• Question: Are states subject to treaties by the federal government?
• Decision: Yes. While Virginia does have sovereign over its land, treaties made by
the U.S. government are supreme law of the land, as stated in Article VI Clause 2.
Therefore, Virginia, as well as all states, must abide by it.
Supremacy
Secession
• Can states secede from the Union?
• No. It would invalidate the Supremacy Clause.
Implied Powers
Define
• Article I Section 8 Clause 18
• Powers that are reasonably inferred by enumerated powers
• The Elastic Clause has been used to increase the power of the federal
government.
Implied Powers
McCulloch v. Maryland (1819)
• Facts of the Case: Congress established the Second Bank of the United
States in 1816. Many states opposed a National Bank, since there is no
provision within the U.S. Constitution that allows for the federal
government to establish a bank. Maryland was one of these states and did
not want a branch of the National Bank to open in their state. So in 1818,
Maryland passed a tax on any non-Maryland bank of $15,000 a year. The
tax was aimed at the National Bank. James McCulloch, the cashier of the
Baltimore branch of the National Bank, refused to pay the tax. So he was
arrested.
• Question:
• Did Congress really have the constitutional authority to establish a national bank?
• Was Maryland allowed to tax a federal entity?
Implied Powers
McCulloch v. Maryland (1819) - continued
• Decision:
• Yes. Chief Justice John Marshall wrote, “Although, among the enumerated
powers of government, we do not find the word ‘bank,’… we find the great
powers to lay and collect taxes, to borrow money; to regulate commerce… Let
the end be legitimate, let it be within the scope of the Constitution, and all
means which are appropriate, which are plainly adapted to that end, which
are not prohibited, but consist with the letter and spirit of the Constitution,
are constitutional.”
While Congress does not explicitly have the power to create a national bank,
through the “necessary and proper” clause via Congress’ power to tax, borrow
money, and regulate commerce, Congress can create a national bank.
Implied Powers
McCulloch v. Maryland (1819) - continued
• Decision (continued):
• No. For a state to tax a federal entity would place the state above the federal
government. Chief Justice Marshall wrote, “…that the government of the
United States, though limited in its power, is supreme within its sphere of
action.”
The federal government does not have much power. But it is supreme in the
power that it does have. Since both states and the federal government are
allowed to create banks, the federal bank must trump the state bank.
Commerce Clause
Define
• Article I Section 8 Clause 3
• Gives Congress the power “to regulate commerce with foreign
nations and among the several states, and with the Indian tribes.”
• Congress has used the Commerce Clause to expand its power; they
have been both successful and unsuccessful.
Commerce Clause
Gibbons v. Ogden (1824)
• Facts of the Case: The state of New York gave Aaron Ogden an
exclusive license to operate steamboat ferries between New Jersey
and New York city on the Hudson River. This mean that no one else
may run steamboats on the same route. Thomas Gibbons, another
steamboat operator, received permission from the federal
government to run his two ferries along Ogden’s route on the Hudson
River. So Ogden sued, claiming that his state license trumps Gibbon’s
federal license.
• Question: Who controls the trade route along the Hudson River?
Commerce Clause
Gibbons v. Ogden (1824) - continued
• Decision: Congress. Chief Justice Marshall, using the “necessary and
proper” clause, interpreted the Commerce Clause of the U.S.
Constitution to mean that Congress controls the navigation between
the states. If Congress was charged with controlling trade among the
states, as the Commerce Clause says, then the means by which states
trade with each other must also fall within Congress’ power. So
Gibbons won.
• Gibbons set the stage for future expansion of congressional power
over commercial activity. So does that mean that all activities that
occur between the states must fall within Congressional power?
Commerce Clause
Southern Pacific Co. v. Arizona (1945)
• Facts of the Case: Arizona passed a law in 1912 that limited the number of
cars a train may pull. The purpose of the law was to decrease the number
of train accidents. Southern Pacific Company operated trains through
Arizona, Texas, and New Mexico. Following the Arizona law would cost
them an additional one million dollars a year. Furthermore, the other
states did not put such restrictions on railroad companies. So they chose
not to follow the Arizona law, who then fined them. Southern Pacific sued
Arizona, claiming that their law was unconstitutional.
• Question: Was the Arizona law unconstitutional – encroach on federal
jurisdiction?
Commerce Clause
Southern Pacific Co. v. Arizona (1945) - continued
• Decision: Yes. Congress has jurisdiction on any trade that crosses
state lines. So when Arizona passed its law limiting train cars, it
affected trade in the other states it traded with, encroaching on
federal jurisdiction. It was therefore unconstitutional.
• So states are not allowed to pass laws that affect trade with other
states because that power belongs to the federal government.
Commerce Clause
Heart of Atlanta Motel v. U.S. (1964)
• Facts of the Case: In 1964 Congress passed the Civil Rights Act which
forbade racial discrimination by places of public accommodation if their
operations affected commerce. The Heart of Atlanta Motel in Atlanta,
Georgia, refused to accept Black Americans and was charged with violating
the Civil Rights Act.
• Question: Did Congress exceed its Commerce Clause powers by depriving
motels of the right to choose their own customers?
• Decision: No. The Court noted that the interstate flow of goods and
people fell under the Commerce Clause.
• Using the Commerce Clause, Congress justified their ability to enforce
some civil rights legislation. This expanded the power of the federal
government.
Commerce Clause
Carter v. Carter Coal Company (1936)
• Facts of the Case: In an attempt to get states to comply with environmental
regulation concerning the production of coal, Congress passed an act in 1935 that
required all coal mines to pay a 15% tax on coal that was produced. If a mine
complied with federal regulations on coal production, they would get 90% of the
tax refunded. James W. Carter was a shareholder of the Carter Coal Company.
He did not want the company to pay the tax because he felt it was
unconstitutional.
• Question: Can Congress use the Commerce Clause to regulate the production of
coal within a state?
• Decision: No. The Commerce Clause does not cover production because
production is not commerce.
• Congress tried to use the Commerce Clause to expand its power over production
but the Supreme Court disagreed and struck it down.
Conclusion
• The Supremacy Clause of the U.S. Constitution establishes the
supremacy of the national government.
• Congress has used the “necessary and proper” clause to increase
their power.
• Congress has also used the Commerce Clause to increase their power.
However, the Supreme Court has pushed back in some situations.
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