



May 27 this year marked the 90th anniversary of the three Supreme Court opinions that invalidated much of President Franklin D. Roosevelt’s New Deal agenda, aroused the president’s wrath at what he called an outdated “horse-and-buggy” interpretation of interstate commerce. Those cases, though reviled at the time by liberals, will be quite useful to those seeking to limit presidential power today.
The most famous of those opinions was the commerce clause decision in Schechter Corp. v. United States, which invalidated much of the National Industrial Recovery Act because it went too far in regulating local commerce.
That ruling was compromised somewhat by a later decision that allowed a farmer’s consumption of his own wheat to be regulated, and a lamentable 6-3 decision allowing federal regulation of marijuana possession. But some limitations on the commerce power remain, affirmed by decisions such as the 2012 case regarding Obamacare.
The enduring significance of the Schechter case, the best-known of the May 27 trilogy, arises from the unanimous ruling that the federal government has no all-encompassing power to regulate the domestic economy according to no defined standard. Justice Benjamin Cardozo’s concurring opinion in the case still resonates: the delegation of such powers to the president was “not canalized within banks that keep it from overflowing. It is unconfined and vagrant … a roving commission to inquire into evils and, upon discovery, correct them … This is delegation running riot. No such plenitude of power is susceptible of transfer … without reference to standards, ethical or commercial, that could be known or predicted … The law is not indifferent to considerations of degree.”
Everything that Justice Cardozo said is applicable to the unconfined “emergency” power over foreign tariffs under which President Donald Trump has acted. Senate Judiciary Committee Chairman Chuck Grassley has appropriately questioned the constitutionality and wisdom of this broad delegation, a question that almost certainly will be litigated. There can be no reasonable objection to a uniform 10% or even 20% tariff to offset the ability of foreign governments to rebate their value-added taxes to exporters, thus authorizing “dumping” if the rebates are not offset, nor is there any objection to a principle of reciprocity or even to President William Howard Taft’s notion of “scientific tariffs.” What Trump has pursued, however, is a festival of arbitrariness; it remains to be seen whether Republicans will prefer rule of law principles to allegiance to the president or whether Democrats will abandon the pleasures of protectionism.
Another unconfined delegation that should be subject to judicial scrutiny is provided by the Civil Rights Restoration Act, passed by the Democrats over President Ronald Reagan’s veto, which established the government’s power to arbitrarily withhold funding from universities. Fund withholding originated in an effort to end-run restrictive interstate commerce decisions. As Chief Justice Harlan Stone is said to have told Roosevelt’s Secretary of Labor Frances Perkins, “The spending power, my dear, the spending power is all you need.” The legislation allows the federal government to terrorize universities, eliminating a theoretical right of judicial review. The act authorizing all of a university’s federal funds to be withheld, because it has the magic words “Civil Rights” in its title, will be difficult to repeal; no university president or congressman has as yet called for repeal, although the statute would be more accurately described if it was called “the Federal Terrorism Authorization Act.” It is notable that Germany, a federal nation, denies a conditional spending power to the national government.
The “security risk” program, which provides for investigating federal employees’ loyalty, is another unconfined delegation. It originated in a loyalty-security program introduced during the Truman administration as a riposte to Senator Joseph Mc Carthy; in his memoirs, Truman called this his worst mistake in office. It was greatly broadened under President Dwight D. Eisenhower to examine “risk” as well as loyalty; its immediate effect is to impose a six-month delay period on young applicants for federal service. Its subsidiary effect, as the journalist Alistair Cooke noted at the time, was to discourage curiosity by the young, creating a regime of cautious slobs. It is now used to discourage political demonstrations and to punish opponents of the national administration.
The second decision in the May 27 trilogy was Louisville Joint Stock Land Bank v. Radford, a unanimous opinion by Justice Louis Brandeis curbing the use of foreclosure and eviction moratoria as a cure for housing shortages and repudiating “social justice through civil justice” as a regulatory technique.
Although the statute condemned was extreme, the sweep of the opinion was broader, defining the rights of landlords and secured creditors as including the right to retain a lien, to realize on the property, to determine the time of sale, to bid at the sale, and to have rents collected pending the sale. If these are impaired, “resort must be had to proceedings by eminent domain, so that, through taxation, the burden of the relief afforded in the public interest may be borne by the public.” The disregard of this principle in the COVID-19 relief programs of the Biden administration resulted in two defeats for it in the Supreme Court. The Roosevelt administration abandoned moratoria as an approach to housing and farm problems in favor of the Home Owners’ Loan Corporation, regarded by some as the most successful of New Deal programs.
The third May 27 decision was Humphrey’s Executor v. United States, holding that commissioners of multi-member regulatory agencies constructed to be bi-partisan cannot be removed by the president at will, so as to avoid coercive executive influence threatening “carrying into operation legislative and judicial powers.” As to such agencies, the Supreme Court echoed the concern of Justice Brandeis dissenting in the earlier Myers case, which the court expressly limited: “The doctrine of the separation of powers was adopted not to promote efficiency but to preclude the exercise of arbitrary power … to save the people from autocracy.” All the justices on the Supreme Court today, even the dissenters, in a recent non-final opinion backing away from the Humphrey’s case, have overlooked Brandeis’ language and concerns.
The opinions of May 27, 1935, as Justice Brandeis told his acolytes, were victories for decentralization. They have served the nation well, and their 90th anniversary deserves recognition.
George Liebmann (george.liebmann2@verizon.net), writing in his individual capacity, is president of the Library Company of the Baltimore Bar and the author of various works on law and politics, most recently “The Tafts” (Twelve Tables Press, 2023).