United States v. Butler Flashcards
Background
Great Depression => falling food prices
•People could not afford to buy food
To raise prices you can do two things
- Increase demand (people have more $$ to spend on food)
- Decrease supply (food becomes more precious)
On their own, farmers would never decrease supply
•Their crop is their only way to pay their bills
•Supply will only decrease if vast majority of farmers agree to do so, and there are strong incentives to cheat
Agricultural Adjustment Act of 1933
- Offers payments to farmers if they agree to not grow crops on some of their land
- Worked out for the farmers because $$ from partial farming + $$ from federal government > $$ from farming all their land
Paid for by…
T-ax on the processing of agricultural products (people who turn wheat into bread, cotton into garments, etc.) –> they were still making profits because they were getting raw materials for basically nothing
HoosacCotton Mills challenged constitutionality of act
Issue
Whether a federal law that offers payment on conditions of changing behavior violates the Taxing and Spending Clause?
Holding
Held 6-3 (Roberts writing) YES. Offering payments can be just as coercive as threatening someone with jail time
What powers does congress have under the taxing and spending clause?
The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States
•Article I, Section 8, clause 1
Madison + Internal Limits Debate
- madison → strong internal limits to kinds of things that can be taxed and spent → clause existed so fed gov has money to do things listed in article 1 section 8 (to regulate commerce, to establish a post office, to regulate immigration, to declare war, etc.)
- but these are only things you can legitimately spend federal tax dollars on
- justice Roberts → rejects this
- if this clause exists to ensure that fed gov has money it needs to do things → it would basically b the necessary and proper clause → WE already have one so why do we need another one talking about money
- madison cannot be right to say that the purpose of this clause is to give the gov money to do things that ar necessary and proper
Hamilton + Separate + Distinct power
- a separate and distinct power → Hamilton’s view
- as long as money is being spent to help general welfare and spending is legitimate it does not also need to help meet the goals in article 1 section 8
- as long as it promotes general welfare its fine
- Roberts endorses this view yet strikes down the agricultural adjustment act
Taxing and spending might overlap with funding the other powers in Article I, Section 8, but it does not need to be limited to those other powers.
•Congress can accomplish a separate set of goals under this clause
- Robert Endorses this view
Internal v. External Limits
- difference between internal and external limits
- internal limit → language within the clause itself → congress’s power over commerce → among states, between nations, and indian tribies
- roberts says internal limit → does this program help the general welfare
- external limits → specify that you can’t exercise one part of the constitution at the expense of another
- thinks that the 10th amendment = external limit of what congress can and can’t do
- offering payment = good way to change behavior
- states = usually in charge of regulating agriculture so we cannot let cogress bribe their way to affecting agriculture → This would take away the states power to do so
- Roberts thinks that the 10th amendment provides an external limit on what Congress can do
- internal limit → language within the clause itself → congress’s power over commerce → among states, between nations, and indian tribies
Robert’s Rule
If the federal government cannot do something directly (under the Commerce Clause or other power), “[i]t must follow that it may not indirectly accomplish those ends by taxing and spending to purchase compliance.”
- the thing congress is trying to do is not an intrestate problem
- ? about regulating agriculture = state problem → congress cannot regulate it directly
- congress argues = this is an incentive → they don’t have to do this → the way they structured incentive → it’s in their best interests to do so
Robert’s Logic
- “The [AAA] invades the reserved rights of the states. It is a statutory plan to regulate and control agricultural production, a matter beyond the powers delegated to the federal government.
- The tax, the appropriation of the funds raised, and the direction for their disbursement, are but parts of the plan. They are but means to an unconstitutional end….”
- general welfare part of taxing clause = only internal limit
- external limit 10th amendment
- goal of law = to invade something given to the states
- even though the strategy is constitutional the goal of the law is unconstitutional → the money is not the end goal, it is the tactic
- without money → can’t induce compliance
- money = strategy → not the end goal
Who is harmed, according to Roberts?
1.State governments
•Authority taken away by the government
2.Agricultural processors
•Money taken from them to directly benefit another group
3.Farmers
•Who have no meaningful choice but to accept government payments and stop farming
•Legal coercion (inducing compliance) created by: Criminalizing, taxing, or offering government money
Stone Dissent (Good Legal Argument + Pragmatism)
Read between the lines: there is no good legal argument behind your ruling. You simply dislike New Deal policies.
- there is no good legal argument behind majorities ruling
- owen roberts does not like new deal policies
- striking something down because it disagrees with political philosophies is not something judges should do
- only strike down if it disagrees with the constitution
- if congress abuses this power we can strike down what they do, can do the same for the pres
- but who guards the guardians, who checks them (judges if they run amock)
- thinks that the court is being activist, knowing that the only way to respond to a ruling like this is to amend the constitution
- sticking down a law → ends conversation
- judges must use their power wisely
Stone Dissent (Coercion)
- definition of coercion is not the absence of the hope of gain, it is the threat of loss
- the fact that you could end up with more money in the future is to coerce
- states aren’t harmed
- congress can give grant with intention that it be used for a particular purpose
- can give money, but for congress to legislative sucessley should be able to say that if u want this money you have to accept the strings that come with it → if we want to to be spend for something, then if you take it use it for that purpose
- congress = power to act, = power to do it successfully
- states taking money and using it for whatever they want undermines congress’s power to act successfully
Stone Dissent: Alternative Rule
- very wordy way of setting up a 4 pronged test
- any federal spending program can be used for this test
- are farmers commanded to participate → no
- if they are forced it would be a threat of loss, not a hope of gain
- does giving $$ to farmers promote general welfare
- does reducing farm production promote the general welfare
- making sure farmers don’t go bankrupt, helping solve problem of low food prices and over production
- then it is constitutional to conduction the receipt of $$ on.a farmers compliance with production cuts
- are farmers commanded to participate → no
- in realms of general welfare → then its okay
Stone Dissent: Internal v. External Limits
- once you find taxing and spending scheme that promotes the general welfare → power given to federal gov
- 10th amendment only comes into play when you have situation where something is not delegated to the federal government
- if congress tried to criminalize something belonging to the states = then 10th amendment = relevant
10thAmendment only provides external limit when
•Congress criminalizes something that only states have power to criminalize
10thAmendment states
•“The powers not delegated to the United States by the Constitution…are reserved to the States”
•Enacting a tax, paying $$, and conditioning the receipt of $$ on doing certain things are delegated to the federal government
