Overruled (10 page)

New Deal adviser Rexford Tugwell, a member of FDR's original “Brain Trust,” would later acknowledge the merit of such criticism. “The detractors of that sort of planning called it price-fixing, and they had a point,” Tugwell wrote in his 1968 memoir. “But it was price-fixing in the public interest. At the same time it was thoroughly inconsistent with orthodox progressivism which held that fixing prices should be forbidden as conspiratorial.”
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Raymond Moley, a fellow Brain Truster and co-architect of the NIRA, was even blunter in his assessment of the law's rise and fall. “Planning an economy in normal times is possible only through the discipline of a police state,” Moley would write. “Economic planning on a national scale in a politically free society involves contradictions that cannot be resolved in practice. The bones of the [NIRA] should be a grim reminder of this reality.”
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As for Justice Brandeis, he wasted little time before letting FDR know exactly where the New Deal had gone wrong. An old-school Progressive, “old Isaiah” had long warned about the dangers of corporate monopoly. As a reform-minded young lawyer, Brandeis had first made his name with a book under his belt titled
The Curse of Bigness.
And as he saw it now, the NIRA looked like more of the same old trouble. “This is the end of this business of centralization,” Brandeis told New Deal adviser Thomas Corcoran shortly after the
Schechter
ruling came down. “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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The Court-Packing Plan

FDR waited four days before going public with his response to the Court's ruling. “The implications of this decision are much more important than almost certainly any decision of my lifetime or yours, more important than any decision probably since the
Dred Scott
case,” he announced at a press conference. Turning to the specifics of the opinion, Roosevelt said the Court's error came from trying to square the large-scale requirements of modern government with the out-of-date limits imposed by the Constitution's Commerce Clause. “The country was in the horse-and-buggy age when that clause was written,” Roosevelt declared. His administration favored a different method of legal interpretation, he explained, one that would “view the interstate commerce clause in the light of present-day civilization.”
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Today, that approach is better known (at least to its critics) as “living constitutionalism.” Essentially, it holds that the Constitution should be viewed as an inherently flexible document, able to adjust to the changing needs of the times. Among the earliest proponents of this view was a young Woodrow Wilson, who argued in his 1885 book
Congressional Government
that the Constitution must be able to “adapt itself to the new conditions of an advancing society.” “If it could not stretch itself to the measure of the times,” Wilson wrote, the Constitution “must be thrown off and left behind, as a bygone device.”
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In private, FDR was far more interested in ditching the Supreme Court as a bygone device, though he did not permit himself the luxury of making that suggestion at his 1935 press conference. When asked
by a reporter about the next move in his showdown with the Court, Roosevelt cryptically replied, “We haven't got to that yet.”
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It would take several more defeats before Roosevelt finally went on the attack. The worst of those defeats came in 1936. First, in the case of
United States v. Butler,
the Court, by a five-to-four vote, effectively nullified the Agricultural Adjustment Act of 1933. Several months later, in a move seen by many reformers as a dangerous reaffirmation of the
Lochner
decision, the Court struck down a New York minimum wage law on the grounds that it interfered with the individual liberty secured by the Fourteenth Amendment. It was the “sacred right of liberty of contract again,”
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fumed New Deal adviser Harold Ickes. The time had come, Ickes and his allies agreed, for something to be done about the Supreme Court.

The solution was FDR's notorious and ill-fated court-packing plan. The idea itself was not new. Theodore Roosevelt basically floated the concept in 1912 as part of his campaign for the popular recall of
Lochner
-style opinions. “Either the recall will have to be adopted,” TR had said, “or else it will have to be made much easier than it now is to get rid, not merely of a bad judge, but of a judge who, however virtuous, has grown so out of touch with social needs and facts that he is unfit longer to render good service on the bench.”
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Cousin Franklin not only embraced that idea, he spent tremendous political capital in a failed attempt to make it the law of the land. On February 5, 1937, after he had been safely reelected to a second term, FDR submitted to Congress his proposal for reorganizing the federal judiciary. At the center of the controversial bill was a provision granting Roosevelt (and all future presidents) the power to appoint one new federal judge to match every sitting judge that had served at least ten years and had not retired or resigned within six months of turning seventy years of age. Under the plan, FDR could add as many
as forty-four new federal judges and, most important, up to six new Supreme Court justices.

“A lower mental or physical vigor leads men to avoid an examination of complicated and changed conditions,” FDR explained. “Little by little, new facts become blurred through old glasses fitted, as it were, for the needs of another generation.”
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It was a disingenuous argument, to say the least. The Court's oldest sitting justice at that time was none other than Progressive hero Louis Brandeis. And although Roosevelt may have had his differences with the eighty-year-old justice over
Schechter
and the other “Black Monday” cases, Brandeis was an otherwise reliable vote in favor of liberal reform. Nor did “old Isaiah” show any signs of slowing down with age. In reality, of course, it was no secret to anybody what Roosevelt's true motives were. He wanted to appoint a fresh slate of liberal justices who were ready, willing, and able to practice judicial deference and uphold future New Deal legislation.

Unhappily for the president, the plan backfired spectacularly. Brandeis, offended at both the personal insult and the frank attack on the independence of the judiciary, maneuvered behind the scenes to bring about the bill's defeat. Most significantly, he put the bill's chief congressional opponent, Democratic Senator Burton K. Wheeler of Montana, in touch with Chief Justice Charles Evans Hughes, who had prepared a memo, signed by himself, Brandeis, and Justice Willis Van Devanter, testifying that the Supreme Court was completely on top of its workload and was in no need of any young blood to pick up the non-existent slack. During testimony on the court-packing proposal before the Senate Judiciary Committee, Senator Wheeler unveiled that memo to great effect. Thwarted by such legislative maneuverings, not to mention by the broad public opposition to his apparent tinkering with a co-equal branch of government, Roosevelt failed to garner the necessary votes and the court-packing plan went down to defeat in the Senate.

The New Deal Revolution

Although FDR lost the court-packing skirmish, there's no doubt that he won the larger battle for control of the Supreme Court. By 1937 the anti–New Deal coalition centered on four justices—dubbed the “Four Horsemen” by their political foes. There was James C. McReynolds, author of the Supreme Court's libertarian ruling in
Meyer v. Nebraska,
which struck down that state's ban on teaching children in a foreign language; Willis Van Devanter, a one-time railroad lawyer and appointee of President William Howard Taft; Pierce Butler, the Court's only Catholic, and the lone dissenter from Justice Holmes's pro-eugenics ruling in
Buck v. Bell;
and George Sutherland, the intellectual leader of the group and the author of the Court's libertarian rulings in
Adkins v. Children's Hospital,
which struck down a minimum wage law for women, and
New State Ice Co. v. Liebmann,
which voided a state-sanctioned ice monopoly.

But as every court watcher knows, the magic number at the Supreme Court is five, not four. And in the late 1930s, that crucial fifth vote was in the hands of Justice Owen Roberts, a former U.S. attorney and appointee of President Calvin Coolidge. In 1936, Roberts had provided the fifth vote needed to strike down New York's minimum wage law. That same year, he authored the Court's opinion nullifying the Agricultural Adjustment Act. But Roberts had also broken stride with the Horsemen on several other occasions, most notably in the 1934 case of
Nebbia v. New York,
where he authored the majority opinion upholding the state's regulation of dairy prices and reaffirming the conviction of a local grocer for selling low-priced milk. That ruling was a paragon of judicial deference and a taste of things to come. With all eyes now focused on FDR's showdown with the Supreme Court, the question of the hour was whether Roberts would side with the Four Horsemen or with the New Deal when the next test of economic regulation reached the bench.

The country got its answer on the morning of March 29, 1937, promptly dubbed “White Monday” by the Washington press corps. By a vote of five to four, with Roberts siding with the liberals and the Horsemen united in dissent, the Supreme Court upheld a Washington state minimum wage law for women under the principle of judicial restraint in
West Coast Co. v. Parrish
. “The Constitution does not speak of freedom of contract,” announced the majority opinion of Chief Justice Hughes. “It speaks of liberty and prohibits the deprivation of liberty without due process of law.” And as far as the Supreme Court was now concerned, “regulation which is reasonable in relation to its subject and is adopted in the interests of the community is due process.”
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Besides, Hughes added, striking a note of paternalism, “What can be closer to the public interest than the health of women and their protection from unscrupulous and overreaching employers?”
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In other words, liberty of contract was now finished as a viable legal argument. Justice Sutherland, author of the suddenly defunct majority opinion in
Adkins v. Children's Hospital,
filed a blistering dissent accusing his colleagues in the majority of a cowardly retreat from basic judicial principles. “The meaning of the Constitution does not change with the ebb and flow of economic events,”
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Sutherland wrote. To say “that the words of the Constitution mean today what they did not mean when written—that is, that they do not apply to a situation now to which they would have applied then—is to rob that instrument of the essential element which continues it in force as the people have made it until they, and not their official agents, have made it otherwise.”
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Sutherland was outraged, but whether he liked it or not, the tide had turned decisively against him. Just two weeks later, on the morning of April 12, the same five-vote liberal majority—Charles Evans Hughes, Owen Roberts, Louis Brandeis, Benjamin Cardozo, and Harlan Fiske Stone—sustained the constitutionality of the National
Labor Relations Act, popularly known as the Wagner Act in tribute to its chief advocate, Senator Robert Wagner of New York. At issue in
National Labor Relations Board v. Jones & Laughlin Steel Corp.
was the scope of congressional power under the Commerce Clause, the very issue that had previously spelled doom for the National Industrial Recovery Act in 1935.

The question now before the Court was whether a dispute between the Jones & Laughlin Corporation and its unionized steel workers inside the state of Pennsylvania counted as interstate commerce for the purposes of the new federal labor law. The Court held that it did, thereby validating the constitutionality of the New Deal's most extensive labor regulation. To begin, wrote Chief Justice Hughes, the Court must acknowledge its own fundamentally deferential role in the political structure. Our job “is to save, and not to destroy. We have repeatedly held that, as between two possible interpretations of a statute, by one of which it would be unconstitutional and by the other valid, our plain duty is to adopt that which will save the act.”
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(Chief Justice John Roberts would employ that same argument seven decades later to save President Barack Obama's health care law.) Turning to the labor law at issue, Hughes found no difficulty in construing it as a permissible exercise of congressional power. “Although activities may be intrastate in character when separately considered,” Hughes wrote, “if they have such a close and substantial relation to interstate commerce that their control is essential or appropriate to protect that commerce from burdens and obstructions, Congress cannot be denied the power to exercise that control.”
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All told, it was one of the most striking turnarounds in legal history. In less than a decade, the Supreme Court had not only rendered liberty of contract a dead letter, it had embraced a sweeping form of judicial deference toward state and federal legislation while also greatly expanding congressional power by allowing federal lawmakers to reach
activities that would previously have been seen as off-limits under the Commerce Clause. As the legal historian William E. Leuchtenburg would put it, “From 1937 on, the relationship among the branches of government shifted dramatically, as an era of ‘judicial supremacy' gave way to deference by the Supreme Court.”
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When it came to government regulation of the economy, Americans would now be living in the world envisioned by Justice Oliver Wendell Holmes.