Default Rules of Government Power: The Police Power; Federalism; The Necessary and Proper Clause

Commonwealth v. Alger

61 Mass. (7 Cush.) 53 (1851)

Begin more than half a century before Lochner. Module 2 asks what a state may do and what the federal government may do, and those are not the same kind of question. Alger is where the asymmetry becomes visible.

Alger owned flats in Boston harbor and built a wharf out over them, past a line the legislature had fixed beyond which no wharf might extend. His argument in the Supreme Judicial Court was that the statute took his property: the flats were his, and a law forbidding him to build on his own soil was confiscation in everything but name. There is no exact decision date — the reporter records only the March term of 1851 — and no vote or lineup is reported. What there is, is Chief Justice Shaw’s opinion, and it is the classic American statement of what the police power is.

Shaw upheld the statute, and the ground matters more than the result. He did not call it a taking justified by necessity, or one too small to compensate. It was not a taking at all, because Alger had never owned what he thought he owned. At 61 Mass. (7 Cush.) at 84: “We think it is a settled principle, growing out of the nature of well ordered civil society, that every holder of property, however absolute and unqualified may be his title, holds it under the implied liability that his use of it may be so regulated, that it shall not be injurious to the equal enjoyment of others having an equal right to the enjoyment of their property, nor injurious to the rights of the community.” The liability is implied. It arrives with the title rather than being laid on top of it. Regulation does not subtract from the estate; on Shaw’s account the estate was always this size.

Now hold that against McCulloch, where the default runs the other way. A state arrives at a constitutional question already holding a general power to legislate for health, safety, morals, and welfare, and the only question a court can ask is what limits it — a federal provision, a state provision, preemption. Nobody has ever asked where Massachusetts got the authority to regulate Boston harbor. The federal government arrives holding nothing and must point to an enumerated grant, which is why Marshall spends the first half of McCulloch on whether the power to charter a bank exists before he reaches whether Maryland may tax it. Grant question, limit question. Keep them apart and this module is orderly; run them together and none of it is.

Then press Shaw. His sentence permits regulation so that a use is not injurious to others or to the community. Is that a limit, or has it merely moved the fight to the word “injurious,” where every statute arrives with a legislative finding of injury already attached? And carry the harder problem into Module 2A. If the answer to “you have taken my property” is always “you never held that stick to begin with,” what is left for the Takings Clause — and what stops a legislature from defining the bundle down to nothing, one implied liability at a time?

Allgeyer v. Louisiana

165 U.S. 578 (1897)

Lochner did not come from nowhere, and if you read it as a beginning you will misread it. The theory was already the law of the United States eight years earlier, announced by the same Justice, in a case about a letter.

Louisiana forbade anyone in the state from acting on a contract of marine insurance with a company that had not complied with Louisiana’s insurance law. Allgeyer, in Louisiana, mailed a letter to a New York insurer under an open marine policy. That was the act — a letter, posted. Argued January 6, 1897, and decided March 1, 1897, the case produced a unanimous Court, nine to nothing, and an opinion by Justice Peckham holding the statute a deprivation of liberty without due process of law.

The holding is the one to be able to state cold: the liberty the Fourteenth Amendment protects is not merely freedom from physical restraint, but takes in the right to enter into contracts. The passage sits at 165 U.S. at 589, and it is worth reading in the official reporter rather than in a digitization — the common online texts disagree with the reporter and with one another, and the two most often cited descend from a single transcription, so they are not independent confirmations.

What matters pedagogically is that Allgeyer is a conversion rather than an invention. The proposition that due process protects substantive economic liberty had been pressed for a quarter century and rejected, most consequentially in the Slaughter-House Cases, where Field and Bradley wrote for the losing side. Their position circulated in dissents and dicta until a unanimous Court adopted it without ceremony. Allgeyer is the moment the dissent became the holding. Watch the consequence when you reach Lochner: Peckham does not have to build the doctrine there, because he already has it. His work is confined to whether a maximum-hours law for bakers falls inside the police power or unreasonably interferes with a liberty settled eight years before.

That narrowing is the doctrine’s whole vulnerability, and it is the first question to put to yourself. If liberty of contract is a constitutional right, then every statute regulating any economic relationship abridges it, because every such statute tells someone what terms he may not agree to. The right therefore decides nothing on its own. All of the doctrine’s content has to live in the police-power exception — in the judgment about which abridgments are reasonable — which means the operative rule is not “there is a right to contract” but “judges will decide which economic regulations are sensible.” Ask whether Peckham could have avoided that.

Then a reading question. Louisiana was reaching a transaction with a New York company under a policy that company had written; the conduct the statute punished was the posting of a letter. Read that way, the vice is not interference with liberty at all — it is a state reaching outside its borders to govern a contract made elsewhere, an extraterritoriality problem and a cousin of the dormant commerce material. So decide: is Allgeyer a substantive-rights case that happens to involve an out-of-state insurer, or a structural case wearing a rights costume? And does it matter that the Court, with both grounds available, took the broader one?

Muller v. Oregon

208 U.S. 412 (1908)

Three years after Lochner, the same Court upheld a maximum-hours law, unanimously, and overruled nothing. Work out how that is possible and you will understand the Lochner era better than the caricature of it allows.

Oregon capped the hours of women employed in factories and laundries at ten a day. Muller was convicted under the statute. Argued January 15, 1908, and decided February 24, 1908, it produced an opinion by Justice Brewer for a unanimous Court, no Justice recused, sustaining the law.

Two things about Muller have outlived it, and they point in opposite directions. The first is the brief. Louis D. Brandeis submitted in support of the statute a document that was overwhelmingly industrial and medical data rather than legal argument; the reports show him among counsel arguing for the State. The Court acknowledged the submission in the body of the opinion at 208 U.S. 419, in a passage directing the reader to a footnote collecting the material. The acknowledgment itself is in the text, not in the footnote, and keep that straight, because the case’s reputation has drifted. Notice what data of that kind can and cannot do. It does not establish a constitutional fact; at most it shows the question was one on which a legislature could reasonably act — the seed of everything later called rational basis, which you will see fully grown in Williamson.

The second is the ground of decision, and it is not a happy one. Brewer sustained the statute by holding that women constitute a class apart for constitutional purposes. At 208 U.S. 422: “Differentiated by these matters from the other sex, she is properly placed in a class by herself, and legislation designed for her protection may be sustained, even when like legislation is not necessary for men and could not be sustained.” Say plainly what that means and move on. The victory for protective labor legislation was purchased with a sex classification, and the Court will spend the second half of the twentieth century dismantling the premise; you will meet the wreckage in Module 11A.

Now the reconciliation problem, which is the assignment. Muller does not overrule Lochner, does not confine it to its facts, does not confess error. Both opinions run the same framework: liberty of contract is the rule, the police power is the exception, and the question is whether the statute fits the exception. So write down the rule that holds both. It will come out looking something like this — a maximum-hours law is invalid unless the class it protects has a distinct vulnerability that makes the asserted health justification real rather than pretextual.

Then test what you wrote. The Lochner Court found no adequate health justification for capping the hours of bakers; the Muller Court found one for women in factories and laundries three years later, on a record built out of published data. Is the difference in the record, in the classification, or in the Justices? Run your rule forward to Adkins, then to West Coast Hotel, and see whether it predicts either. If a rule cannot tell you which way the next case comes out, be honest about what you hold: not a doctrine but a description, and what it describes may be nothing more principled than which statutes this Court would tolerate.

Adkins v. Children's Hospital

261 U.S. 525 (1923)

Get the amendment right, because most of the class will not. The statute was an act of Congress operating in the District of Columbia, so the clause that killed it was the Fifth Amendment’s Due Process Clause, not the Fourteenth’s. That is not pedantry. Liberty of contract was never a theory about what the Fourteenth Amendment did to the states; it was a theory about what “due process of law” means wherever the phrase appears, binding Congress as it bound New York. So when West Coast Hotel overrules Adkins by name fourteen years later, what is retired is not an allocation of power between levels of government but a substantive reading of two clauses at once.

Congress established a board to fix minimum wages for women and children in the District, and its orders were challenged. Nos. 795 and 796 were argued March 14, 1923, and decided April 9, 1923. Justice Sutherland wrote for a Court divided five to three, Justice Brandeis not participating. The Court gave no reason for the recusal, and the usual explanation is that his daughter Elizabeth Brandeis had been secretary to the District’s Minimum Wage Board — a staff position, not a seat on the board, and a connection the reports do not mention. Chief Justice Taft dissented, joined by Justice Sanford, and Justice Holmes dissented separately. Do the arithmetic before you go on. Five votes out of eight, over the Chief Justice’s objection, set the constitutional law of wage legislation for the next fourteen years.

The holding is Allgeyer and Lochner carried from hours to price: a statute fixing what an employer must pay unconstitutionally interferes with the parties’ liberty to agree on terms. What you must not skip is how Sutherland handled Muller. Fifteen years earlier the Court had upheld an hours law for women precisely because women were, in its view, a class apart, subject to protective legislation that could not have been sustained for men. Sutherland did not repudiate that reasoning. He confined it. The Nineteenth Amendment had been ratified and the civil position of women had changed, and on his account those developments drained the old differences of the constitutional significance Muller gave them.

Read that slowly, because the same premise runs in both cases and comes out backwards. Muller: a woman’s distinct civil position justifies legislation protecting her. Adkins: a woman’s changed civil position forbids legislation protecting her. In each, a woman’s civil status determines what protective legislation may reach her, and in each it delivers what the writing Justices wanted.

It is easy to file that under irony and move on. Do not. Sutherland’s argument is real, and you will meet it again: formal equality and protective treatment cannot both be had, because a rule declaring a group is not a class apart strips it of legislation premised on its being one. Put the argument to yourself in its strong form, drained of 1923’s politics. Is there a defensible position that legislation singling out a group for protection also ratifies that group’s subordinate status, so that a court committed to equality must view such legislation with suspicion? If there is, formal equality arguments carry a deregulatory tendency built in, and watch for it in Module 11A and again in Module 10. If there is not, say exactly where the argument breaks. Is Sutherland wrong about liberty of contract, wrong about what the Nineteenth Amendment accomplished, or wrong to think a court rather than a legislature decides when a group no longer needs protecting?

Williamson v. Lee Optical of Oklahoma, Inc.

348 U.S. 483 (1955)

The era ends here, and it ends without drama, in a short opinion about eyeglasses.

Oklahoma made it unlawful for an optician to fit or duplicate lenses without a prescription from an optometrist or an ophthalmologist, even to replace a lens the customer already owned. The district court struck the provision down, 120 F. Supp. 128. On an appeal and a cross-appeal, Nos. 184 and 185, argued March 2, 1955 and decided March 28, 1955, the Supreme Court affirmed the judgment in part and reversed it in part, reversing as to that provision. Justice Douglas wrote; the vote was eight to nothing, Justice Harlan taking no part in the consideration or decision. It is unanimous among the participating Justices, and it is not — whatever you may see written — nine to nothing.

Two sentences carry the case. The first is the obituary: “The day is gone when this Court uses the Due Process Clause of the Fourteenth Amendment to strike down state laws, regulatory of business and industrial conditions, because they may be unwise, improvident, or out of harmony with a particular school of thought.” Notice how it names the vice. Not that Lochner and Adkins protected the wrong liberty, but that they substituted judicial economic judgment for legislative economic judgment. The second supplies the replacement: “the law need not be in every respect logically consistent with its aims to be constitutional. It is enough that there is an evil at hand for correction, and that it might be thought that the particular legislative measure was a rational way to correct it.”

Everything turns on the mood of those verbs. Might be thought — by whom, and when? Douglas reasons about what the Oklahoma legislature might have concluded, supplying purposes it may never have entertained and measuring the statute against purposes the Court has manufactured. That, and not the result, makes this the terminus of the Lochner era; West Coast Hotel had already delivered results of this kind, sustaining wage legislation and overruling Adkins. Williamson goes further. It relieves the state of any obligation to have had a reason, because the Court will supply one.

This deference is the baseline against which Carolene Products sets its famous footnote, and read the two in that order — rule first, exceptions second. A footnote proposing that the presumption of constitutionality may be narrower in certain categories means nothing until you know how wide it runs everywhere else, and Williamson is how wide. Carry the measurement into Module 10, where the same two words do work in equal protection, and ask whether they mean the same thing there.

Two questions, neither rhetorical. Is a standard a statute satisfies by reference to a purpose the legislature never held a standard at all, or is it a decision rule — an instruction to uphold — phrased in the grammar of an inquiry? And find the floor: draft an economic regulation that fails Williamson. Not one offending a specific constitutional guarantee, not one failing equal protection, but one a court must strike because no rational legislator could have thought it addressed any evil at hand. If you can write it, you have located the surviving residue of economic substantive due process. If you cannot, say so out loud and be ready to defend what follows.