Economic Liberty and the Constitution

March 17, 2019 by Dan Mitchell @ International Liberty
 

Two days ago, I wrote about how the Constitution was designed, in large part, to protect Americans from majoritarianism.

The Supreme Court is doing a reasonably good job of protecting some of our liberties (or, in the Heller case, restoring our liberties), but I point out in this clip from a recent interview that the Justices have failed to protect our property rights.



But since I’m now a lawyer, let’s focus instead on what legal scholars have written on this issue.
The late Professor Bernard Siegan authored a great book, Economic Liberties and the Constitution. If you care about these issues, you should buy it.

In the meantime, here are some excerpts from an article he wrote for Chapman Law Review.

The original Constitution of 1787 granted limited powers to each of the three branches of government… The federal government was limited in power so that it could not deprive citizens of their privileges and immunities… The Constitution was passed by delegates who had lived under and were steeped in the common law. Most terms and provisions of the Constitution are of common law origin and cannot fully be understood without reference to the common law. Thus, although there were no specific protections for the right of property or economic activity or press and speech, the United States government was given no power in the Constitution to deprive people of these common law rights.

Siegan explains some of the thinking that motivated James Madison.

The most influential Framer of both the United States Constitution and the Bill of Rights was James Madison, a delegate to the Constitutional Convention from Virginia… He spent considerable time preparing for the Convention by studying the writings of leading authorities on government, particularly the Scottish philosopher and historian David Hume, who advocated freedom for commerce as essential to the viability and progress of a nation. As a result of his…extensive review of literature on the subject of government, Madison concluded that for a nation to be politically and economically successful considerable limitation of government powers was required, enabling the productive, inventive, and competitive talents of the people to flourish. He believed that the welfare of a nation mandated the creation of a commercial republic that would depend on freedom of the markets and not on the authority of the state.

There’s also an excellent book, The Dirty Dozen, written by Robert Levy and William Mellor, which outlines twelve terrible Supreme Court decisions that expanded the power of government (including Wickard v. Filburn and Kelo v City of New London).
Here are some excerpts from remarks by Levy.

The Tenth Amendment says quite clearly that the federal government is authorized to exercise only certain enumerated powers, the ones that are listed there and that are specifically delegated to the national government. The Tenth Amendment goes on to say, if the power is not listed there, if it’s not enumerated and delegated to the national government, then it is reserved to the states or, depending on the provisions of state constitutions and state laws, to the people. …No matter how worthwhile the goal, no matter how much Congress thinks that it has identified a really important problem, and no matter how sure Congress is that it knows how to fix the problem, if there’s no constitutional authority to pursue it, then the federal government has to step aside and leave the matter to the states or private parties.

In other words, the Founders weren’t joking when they listed the enumerated powers.
They even included an amendment as part of the Bill of Rights to reinforce those limitations on the power of government.

Speaking of amendments, advocates of bigger government could have used that approach to expand the power of Washington. But, as Levy points out, they didn’t need to follow the rules because the Supreme Court decided to no longer protect economic liberty.

…the Supreme Court has accomplished through the back door what the states and the Congress could not have accomplished through the prescribed amendment process. Regrettably, I think, the modern court has lost its compass… Much of the court’s enduring mischief…started during the New Deal and continues today.

Last but not least, Professor Richard Epstein (my former debating partner) has a great book entitled The Classical Liberal Constitution. It also belongs in your library (and will help underscore the differences between classical liberalism and today’s statist version of liberalism).
Until then, here are excerpts from one of his articles.

…the Constitution…does offer broad and specific protections to private property through the Takings Clause (“nor shall private property be taken for public use without just compensation”^4×4. U.S. Const. amend. V. ) and through the Due Processes Clauses of the Fifth and the Fourteenth Amendments (providing that neither the federal government nor the states may deprive any person of “life, liberty or property, without due process of law”^5×5. Id.; id. amend. XIV. ). …a unified conceptual framework should apply to what are called economic and personal liberties, even if it were possible to articulate some hard-edged separation between them. The analytical origin of this position is that voluntary contracting, whether for the transfer of goods and services or the formation of long-term associations, works as well in the one domain as in the other.

Epstein points out that there was a spirited debate when the Constitution was drafted and adopted, but both sides in that debate would oppose the expansion of government power that largely began in the 1930s.

…there were many differences between the Federalists and Antifederalists, but anyone would be hard pressed to find a single point of contention that could be cashed out to support the hallmark legislation of the New Deal. …the Contracts Clause imposes limitations on how the state could regulate ot only existing contracts, but also those contracts that had not yet been made. And whatever doubts that existed were largely removed by the adoption of the Fourteenth Amendment, where the correct reading of the Privileges or Immunities, Due Process, and Equal Protection Clauses all place powerful limitation on the scope of state power to regulate economic and noneconomic matters alike. …neither the Federalists nor the Antifederalists in the ratification debates supported such massive federal schemes as the National Labor Relations Act.

Let’s close with this clever image someone posted on Facebook.

P.S. Here’s some satire about Obama and the Bill of Rights.

P.P.S. And here’s what Professor Epstein said about his interactions with Obama at the University of Chicago.

P.P.P.S. I image Levy/Mellor book would be re-titled The Dirty Thirteen if it was updated to include the horrific Obamacare decision.