How States & Nations Regulated their Commercial Intercourse
by P.A. Madison on June 30th, 2011
- The Power Described
- The Regulating Power Sought Over Commerce with the States
- Commerce Defined
- Why Nations Regulate their Commercial Intercourse
- Why the Power among the States
- Why Congress Lacks Affirmative Powers over Interstate Commerce
- Confusing Marine Power with the Regulation of Commerce
- Conclusion
The United States Supreme court tells us their “case law firmly establishes Congress’ power to regulate purely local activities that are part of an economic ‘class of activities’ that have a substantial effect on interstate commerce.” In a September 2009 press release, former speaker of the House Nancy Pelosi asserted, “the Constitution gives Congress broad power to regulate activities that have an effect on interstate commerce.”
The question explored here is whether such “case law” or public assertions are supported in any way by the history, text and custom of regulating commerce. If it cannot be supported by any factual evidence then it is clearly erroneous and has no place in federal jurisprudence where facts and truth should be held paramount.
History of the organic law of this country conclusively shows beyond any doubt that the regulation of commerce was nothing more, and nothing less, then the act of imposing a tax on articles of import for the sole purpose of restricting or prohibiting their introduction in order to protect or promote local manufactures. Moreover, this was the custom and practice of all nations in regulating commerce with other nations or parts of a nation and no nation ever claimed police powers over another nation or parts of themselves via authority to regulate commerce.
Because regulating commerce and generating revenue is accomplished through the same identical method of imposing a tax, the regulation of commerce “among the several states” was inserted for remedial purposes of preventing States from taxing the trade of other States as well as preventing Congress from doing the same under Section 9.
It will become abundantly clear why James Madison referred to the regulation of commerce “among the several states” as a “negative and preventive provision” and not any power Congress may resort to for “positive purposes” (see Madison letter to Joseph C. Cabell).
Finally, it will be pointed how the court has mistakenly confused marine law of nations with that of regulating commerce, which has introduced erroneous assumptions over the extent of the power.
Chief Justice Marshall tells us in the classic and still respected case of Gibbons v. Ogden (1824) that the power to regulate commerce “describes the commercial intercourse between nations, and parts of nations, in all its branches, and is regulated by prescribing rules for carrying on that intercourse.”
Marshall obviously is correct in describing the Commerce Clause as dealing with commercial intercourse “between” nations and parts of nations because the Constitution speaks only of regulating commerce “with foreign nations” and “among the several States” and not the regulation of commercial activities within nations or within States. It is too obvious why the regulation of commerce must be “between” and not “within” because Congress has no sovereign jurisdiction over commercial activities either within a foreign nation or within a State. This fact alone makes it silly to suggest the power to regulate commerce can have broad application.
Some might attempt to argue the method of regulating foreign commerce is not the same as regulating commerce among the States. However, the text of the Commerce Clause reveals no alternating commands to how the regulation of commerce shall be regulated differently between States and nations (or even with Indian tribes). Marshall pointed out this clear fact in Gibbons by observing, “it (regulation of commerce) must carry the same meaning throughout the sentence, and remain a unit, unless there be some plain intelligible cause which alters it.”
Marshall further pointed out that “[c]ommerce among the States must, of necessity, be commerce with the States.”
Suffice to say, there is no “plain intelligible cause” to alter how the power is exercised differently between States and nations. Since commerce is regulated in the same manner among the States as with foreign nations, answering what rules are prescribed in regulating foreign commerce also answers the question of what are the proper rules for regulating commerce among the States.
Because the subject of regulation is the commercial intercourse “between” nations and States and not within them, does not make it terribly important of what might all come under the singular word “commerce” outside of this regulation because its meaning can only be properly defined in connection with what is actually exchanged between different powers. This textual fact of the Commerce Clause limits the discussion of commerce to importation since that is the only commercial intercourse that goes on between different powers (more on this in a moment).
A quick word on navigation: When “navigation” is spoken of as an ingredient of regulating commerce it is a reference to points of entry where ships of trade are directed to enter for purpose of customs (cargo inspection, duties and imposts levied, seizures made, etc.). This is why Chief Justice Marshall said the words, “nor shall vessels bound to or from one state be obliged to enter, clear, or pay duties in another” was the navigation comprehended in regulating commerce.
The Regulating Power Sought Over Commerce with the States
No doubt the reason for little debate or controversies over Congress regulating commerce among the States during the constitutional convention was due to the well understood practice of the power and resolutions under the old Articles of Confederation asking for State approval to empower Congress with specific and detailed powers to regulate State and foreign commerce. The first resolution in February of 1781 by John Witherspoon, read, in part:
That it is indispensably necessary that the United States in Congress assembled, should be vested with a right of superintending the commercial regulations of every state, that none may take place that shall be partial or contrary to the common interest; and that they should be vested with the exclusive right of laying duties upon all imported articles, no restriction to be valid, and no such duty to be laid but with the consent of nine states: provided, that all duties and imposts laid by the United States in Congress assembled, shall always be a certain proportion of the value of the article or articles on which the same shall be laid …
Another resolution example is from a committee lead by James Monroe in 1785 asking the States to give Congress the authority “of regulating the trade of the states, as well with foreign nations, as with each other, and of laying such impost and duties, upon imports and exports, as may be necessary for the purpose.” Monroe would later explain in 1822 that:
Commerce between independent powers or communities is universally regulated by duties and imposts. It was so regulated by the States before the adoption of this Constitution, equally in respect to each other and to foreign powers. The goods and vessels (tonnage duties) employed in the trade are the only subjects of regulation. It can act on none other. A power, then, to impose such duties and imposts in regard to foreign nations and to prevent any on the trade between the States was the only power granted.
Madison offered a resolution on November 30, 1785 asking that, “the United States in Congress assembled be authorized to prohibit vessels belonging to any foreign nation from entering any of the ports thereof, or to impose any duties on such vessels and their cargoes which may be judged necessary.”
To prevent States from regulating commerce, Madison’s resolution called for no State to be at “liberty to impose duties on any goods, wares, or merchandise, imported, by land or by water, from any other state, but may altogether prohibit the importation from any state of any particular species or description of goods, wares, or merchandise, of which the importation is at the same time prohibited from all other places whatsoever.”
This resolution leads to the Annapolis Convention of 1786 that in return lead to the convention in Philadelphia in May of 1787.
Another resolution in August of 1786 asking the States to empower Congress with the power to “have the sole and exclusive power of regulating the trade of the States as well with foreign nations as with each other and of laying such prohibitions and such Imposts and duties upon imports and exports as may be Necessary for the purpose…”
These resolutions show a clear, consistent understanding of how commerce is, and was, regulated through taxation on importation and not municipal law over internal commercial activities. Additionally, these examples illustrate the well-recognized dual purpose of taxation of either raising revenue or regulating commerce.
William Pitt speaking before the House of Commons in 1765 pointed out the dual purpose of taxes, “there is a plain distinction between taxes levied for the purpose of raising a revenue, and duties imposed for the regulation of trade.” Colonial delegate Benjamin Franklin asserted the same thing a year later. James Madison in Federalist No. 56 said, “[t]axation will consist, in a great measure, of duties which will be involved in the regulation of commerce.”
Marshall in Gibbons also recognized the dual purpose of taxes: “It is true that duties may often be, and in fact often are, imposed on tonnage with a view to the regulation of commerce, but they may be also imposed with a view to revenue.”
Imposing a general revenue tax disguised as a regulation of commerce that clearly does not protect or promote local manufactures, could have adverse consequences as Britain once discovered during colonial times (the colonies “cheerfully consent[ed]” to Britain taxing for the regulation of their external commerce but not for general revenue). Because of this dual nature of taxes, States were restrained from laying taxes for any purpose upon imports or exports outside of their own.
The first act of Congress following the convention to regulate commercial intercourse was an act titled, “An act for laying a duty on goods, wares, and merchandizes, imported into the United States,” signed by President Washington on July 4, 1789. Imposing rules of what imported articles are restricted or prohibited via a tax was the only known method of regulating commercial intercourse between independent powers.
It is now easy to understand what Marshall meant of regulating commerce in Gibbons as “cannot stop at the external boundary line of each State, but may be introduced into the interior.” He of course was referring to the prohibition against a State in taxing either another State or foreign nation imports/exports once it is introduced into the State and with the intent to be shipped through the State to another for purpose of bringing that trade to market.
Because the regulation of commerce is the regulation of intercourse “between” different powers, and because this intercourse is regulated through duties on imports, leaves us with the only question of what exactly is an “import.”
Chief Justice Marshall in Brown v. Maryland (1827) says the “lexicons inform us they (imports) are ‘things imported.'” He continues, “If we appeal to usage for the meaning of the word, we shall receive the same answer. They are the articles themselves which are brought into the country.” Marshall goes on to state the articles of import are those “only which are intended for sale or consumption in the country.”
It should be apparent how such things as “labor” or “services” cannot come under the regulation of commerce because, for example, “services” are not property imported. It is also rather absurd to argue regulating the transportation of “passengers” is a regulation of commerce in light of the unmistakable fact the United States no longer recognizes a property in men for purposes of trade. This is what made regulating the foreign slave trade awkward under the Commerce Clause because as Madison put it, human beings were not “property,” and “slaves are not like merchandise, consumed, etc.”
This is why the court in New York v. Miln (1837) was forced to acknowledge persons “are not the subject of commerce, and not being imported goods, cannot fall within a train of reasoning founded upon the construction of a power given to Congress to regulate commerce.”
England and the States never asserted they were regulating commerce when they passed laws regulating manufactures, labor or fixing the price of certain commodities.
The word “commerce” as employed under the Commerce Clause also does not extend any powers over buying and selling. Thomas Jefferson said, “[t]o make a thing which may be bought and sold is not to prescribe regulations for buying and selling . . . if this were an exercise of the power of regulating commerce, it would be void, as extending as much to the internal commerce of every state, as to its external.” In response to Jefferson, Hamilton agreed buying and selling “falls more aptly within the province of the local jurisdictions than within that of the general government.”
Consider also that to regulate the value of money, to make laws for bankruptcies, or to “fix the standard of weights and measures” are all-important ingredients of commerce, yet the Constitution specifically enumerates these powers for Congress to exercise. In Federalist No. 42 Madison said: “The power of establishing uniform laws of bankruptcy, is so intimately connected with the regulation of commerce, and will prevent so many frauds where the parties or their property may lie, or be removed into different states, that the expediency of it seems not likely to be drawn into question.”
So while bankruptcy may be “intimately connected” with commerce, this connection does not make it part of any regulation of commerce because bankruptcies are never the subject of commercial intercourse between different sovereigns.
It is no wonder that the framers are frequently found referring to the regulation of commerce as the “regulation of trade” because this commerce is the regulation of those articles of trade imported for the purpose of consumption.
Why Nations Regulate their Commercial Intercourse
The object behind taxation for regulating commercial intercourse is not, of course, revenue, but for the protection or encouragement of local manufactures by laying restrictive or prohibiting duties on those imported items that compete with what is domestically manufactured. Moreover, like all taxes, this tax extends no power over the thing taxed other than to restrict or prohibit its introduction.
The Declaration of Colonial Rights of 1774 declared the “regulation of our external commerce, for the purpose of securing the commercial advantages of the whole empire to the mother-country, and the commercial benefits of its respective members.”
Again, referring to Section 1 of the first acts of Congress in regulating commerce in 1789, we find the purpose of regulating commerce in the words, “encouragement and protection of manufactures, that duties be laid on goods, wares, and merchandizes, imported, etc.”
Jefferson wrote in 1821 that the “government of the United States at a very early period, when establishing its tariff on foreign importations, were very much guided in their selection of objects by a desire to encourage manufactures within themselves.”
Madison writing on tariffs in 1828 said the power of regulating commerce “has been understood and used, by all commercial and manufacturing nations, as embracing the object of encouraging manufactures. It is believed that not a single exception can be named.”
A couple of examples of regulating commerce is in order: Congress may seek to encourage American shipbuilding or American navigation in the coasting trade through prescribing high tonnage duties on foreign made vessels while laying little to none on American made ships in order to encourage building or use of American ships. Another example would be how Congress currently encourages the use of American made ethanol for gasoline blending by placing a $0.60 per gallon duty on all imported ethanol. While this is a proper exercise of regulating commerce, mandating by positive law that refineries must produce gasoline blended with ethanol is not because such laws are a police regulation that only the sovereign where such activities occur under can mandate.
During the federal convention in 1787, Madison noted that Col. Mason observed the “particular States might wish to encourage, by impost duties, certain manufactures, for which they enjoyed natural advantages, as Virginia [in] the manufacture of hemp, etc.” Madison responded by saying the “encouragement of manufactures in that mode requires duties, not only on imports directly from foreign countries, but from the other States in the Union, which would revive all the mischiefs experienced from the want of a general government over commerce.”
Why Congress was empowered to Regulate Commerce among the States
Nothing clarifies a constitutional provision better than the purpose for which it was approved and adopted to serve. With that said, a little history is in order.
The single most cause of discontent among the Colonies and States was over how particular States taxed the commerce of other States. Example: Connecticut was taxing the produce of Massachusetts as it navigated down the Connecticut River causing Massachusetts to retaliate by taxing all exports from its harbors belonging to citizens of all New England colonies prior to 1650.
Later New York attempted to break up the trade of Connecticut and New Jersey by imposing heavy duties on every vessel entering from those States. Delaware and New Jersey attempted to attract the foreign trade of Pennsylvania and New York by offering lower import duties. Massachusetts and Rhode Island placed prohibitive duties on imports via British ships while Connecticut admitted such imports free, seeking a monopoly of domestic trade in British products.
James Madison explains the “very material object” of the power to regulate commerce among the States in Federalist No. 42:
A very material object of this power was the relief of the States which import and export through other States, from the improper contributions levied on them by the latter. Were these at liberty to regulate the trade between State and State, it must be foreseen that ways would be found out, to load the articles of import and export, during the passage through their jurisdiction, with duties which would fall on the makers of the latter, and the consumers of the former. We may be assured by past experience, that such a practice would be introduced by future contrivances; and both by that and a common knowledge of human affairs, that it would nourish unceasing animosities, and not improbably terminate in serious interruptions of the public tranquility.
Madison describes the power as a “constitutional remedy” in this 1832 letter to Professor Davis of the University of Virginia:
The power to regulate commerce among the States was well known and so explained by the advocates of the Constitution when before the people for their consideration, to be as a necessary control on the conduct of some of the importing States toward their non-importing neighbors. A recurrence to the angry legislation produced by it among the parties, some of whom had passed commercial laws (duties and imposts on articles of import) more rigid against others than against foreign nations, will well account for the constitutional remedy.
Alexander Hamilton liken States regulating each other’s trade to the “trammels” of the German empire: “The commerce of the German empire is in continual trammels from the multiplicity of the duties which the several princes and states exact upon the merchandises passing through their territories, by means of which the fine streams and navigable rivers with which Germany is so happily watered are rendered almost useless.”
Framer Edmund Randolph commenting upon the powers of Congress over commerce among the States as President Washington’s AG in 1791, described the power as “little more than to establish the forms of commercial intercourse between the States, and to keep the prohibitions which the constitution imposes on that intercourse undiminished in their operation; that is, to prevent taxes on imports or exports.”
It does not require rocket science to figure out why States would desire an end to such mischief by removing the power of the States to impose such taxes. The accepted way of doing it was to delegate the power exclusively in one authority so no State could claim it still possessed the right, and if any State did attempt to tax other States commerce for its own interests there would be a remedial avenue in voiding such actions.
None of this of course, in any way, extends to concerns over buying or selling across State lines.
Example: A resident citizen of a State purchases a book from a mail order merchant who then ships the book from another State to the purchaser. This activity is not part of any regulation of commerce because the book is not a property belonging to an export of another State with the intent to bring to market for sale but is merely private property having already been sold.
As we will discover below, the central government could not be trusted with any affirmative power to regulate State-to-State commerce.
Congress Lacks Affirmative Powers over Interstate Commerce
With the regulation of commerce being the power to impose a tax upon competing articles of importation for purposes of protecting or promoting local manufactures, makes clear how the Constitution limits its exercise between States. Under Article I, Section 9 (Limits on Congress) under the clause that reads, “No Tax or Duty shall be laid on Articles exported from any State.”
This federal prohibition is broad and encompasses every known tax for every known purpose upon any articles exported from any State. An “export” is merely the reverse of an import – that is to say, only those items of trade transported out for the purpose of sale or consumption in another jurisdiction.
Framer James Wilson made it clear this prohibition extended to the regulation of commerce by pointing out this federal prohibition against taxing State exports would remove “half the regulation of trade,” meaning Congress would effectively be left with only an affirmative power over foreign imports while leaving the regulation of commerce among the States a nullity.
The debate over the clause during the federal convention went along these lines (from Madison’s notes):
Mr. Elseworth: It is best as it stands-The power of regulating trade between the States will protect them agst each other-Should this not be the case, the attempts of one to tax the produce of another passing through its hands, will force a direct exportation and defeat themselves – There are solid reasons agst. Congs taxing exports. 1. it will discourage industry, as taxes on imports discourage luxury. 2. The produce of different States is such as to prevent uniformity in such taxes. there are indeed but a few articles that could be taxed at all; as Tobo. (Tobacco) rice & indigo, and a tax on these alone would be partial & unjust. 3. The taxing of exports would engender incurable jealousies.
Mr. Williamson: Tho’ N- C. (North Carolina) has been taxed by Virga (Virginia) by a duty on 12,000 Hhs of her Tobo. exported thro’ Virga yet he would never agree to this power. Should it take place, it would destroy the last hope of an adoption of the plan.
Mr. Butler was strenuously opposed to a power over exports as unjust and alarming to the staple States.
Mr. Langdon suggested a prohibition on the States from taxing the produce of other States exported from their harbours.
Mr. Dickenson: The power of taxing exports may be inconvenient at present; but it must be of dangerous consequence to prohibit it with respect to all articles and forever. He thought it would be better to except particular articles from the power.
Mr. Sherman: It is best to prohibit the National legislature in all cases. The States will never give up all power over trade. An enumeration of particular articles would be difficult invidious and improper.
Mr. Gerry was strenuously opposed to the power over exports. It might be made use of to compel the States to comply with the will of the Genl Government, and to grant it any new powers which might be demanded-We have given it more power already than we know how will be exercised-it will enable the Genl Govt to oppress the States, as much as Ireland is oppressed by Great Britain.
Mr. Mercer was strenous against giving Congress power to tax exports. Such taxes were impolitic, as encouraging the raising of articles not meant for exportation. The States had now a right where their situation permitted, to tax both the imports and exports of their uncommercial neighbours. It was enough for them to sacrifice one half of it. It had been said the Southern States had most need of naval protection. The reverse was the case. Were it not for promoting the carrying trade of the Northn States, the Southn States could let their trade go into foreign bottoms, where it would not need our protection. Virginia by taxing her tobacco had given an advantage to that of Maryland.
Mr. Butler declared that he never would agree to the power of taxing exports.
As it turned out, framer Roger Sherman was correct; States would never give up all power over commerce to the central government, nor did they.
It has been argued the clause really reads “No Tax or Duty shall be laid on Articles exported [to a foreign nation] from any State.” This argument obviously has serious flaws primarily because such an interpretation is at war with the unambiguous text. It is also at war with the fact Congress avoided taxing State exports from State-to-State to avoid any appearance of taxing this trade.
Example: When Congress passed the controversial Carriage Tax of 1794 for taxing the conveyance of passengers it made very clear that carriages used in “husbandry, or for the transporting or carrying of goods, wares, merchandise, produce or commodities” was exempted. This was to avoid any appearance of Congress attempting to lay a tax on State-to-State exports.
Without the power to lay duties on State exports, there are no means for Congress to encourage or protect manufactures in one State from competition of another State. Congress cannot argue they are merely regulating State imports because one States import is another States export when it comes to commerce among the States. Regulating commerce only works when the intercourse is between foreign nations and where there are no State exports involved.
Justice Story said of section nine: “The obvious object of these provisions is, to prevent any possibility of applying the power to lay taxes, or regulate commerce, injuriously to the interests of any one state, so as to favour or aid another.” Story further remarked the “prohibition extends not only to exports, but to the exporter. Congress can no more rightfully tax the one, than the other.”
Framer Charles Pinckney told the House on February 14, 1820:
I will only mention here, as it is perfectly within my recollection, that the power was given to Congress to regulate the commerce by water between the States, and it being feared, by the Southern, that the Eastern would, whenever they could, do so to the disadvantage of the Southern States, you will find, in the 9th section of the 1st article, Congress are prevented from taxing exports, or giving preference to the ports of one State over another, or obliging vessels bound from one State to clear, enter, or pay duties in another; which restrictions, more clearly than any thing else, prove what the power to regulate commerce among the several States means.
Since the States made no restriction upon themselves to regulate their own internal commerce, can act to promote or protect manufactures of the State by imposing restrictive or prohibitory duties on anything that competes with what is made and sold in the State. Example: A State may impose high duties on foreign made t-shirts that are shipped into the State with the intent to be sold intrastate in order to protect State t-shirt manufacture from low cost foreign competition.
There is no right under the Commerce Clause that says merchandise must be freely admitted and sold within a State but only that outside trade may enter and exit a State unburdened by taxes.
Since it is abundantly clear to what the text and history of the clause commands, no further discussion is required.
Confusing Marine Power with the Regulation of Commerce
It needs to be noted how the powers over commerce has been erroneously extended through the false assumption of the maritime jurisdiction and the regulation of commerce being one of the same. They are not.
When the States moved from a league of States to one of a Nation for limited purposes of foreign commerce, defense, bankruptcies, piracies on the seas, etc., became by custom of nations a marine power. Per law of nations, all maritime affairs within three miles of the shore are invested with the national power and this jurisdiction extends to anything related to the sea such as salvage, marine insurance, safety regulations, contracts, vessel registration, liens, coasting trade, pilotage, seamen, etc., etc., etc.
Nobody disputed or questioned the fact the new general government would be empowered over general maritime affairs of the sea because it was widely viewed as the responsibility of all nations to exercise. Framer Edmund Randolph summed it up best when he wrote as Attorney General:
The law of nations, although not specifically adopted by the Constitution, is essentially a part of the law of the land. Its obligation commences and runs with the existence of a nation, subject to modification on some points of indifference.
This explains how the constitution can extend jurisdiction to the judiciary over admiralty and maritime affairs without such a power having been specifically delegated to national government to exercise.
Maritime jurisdiction extends itself to rivers and canals that are directly connected with the sea, and which may allow navigating for purpose of carrying out trade. Bodies of water where there is no direct connection to the sea or channels unusable for trade do not fall within this jurisdiction.
Furthermore, it is the custom of nations to treat vessels’ as exclusive property under the jurisdiction of the nation whose flag they sail under. Said Webster: “A vessel on the high seas, beyond the distance of a marine league from the shore, is regarded as part of the territory of the nation to which she belongs, and subjected, exclusively to the jurisdiction of that nation.”
This is the authority for Congress to require vessels to carry necessary medications for seamen, or tax seamen wages to provide for hospitalization in case of sickness. None of this has anything to do with the Commerce Clause.
Marshall in Gibbons v. Ogden points out that the marine power of the nation and the regulation of foreign commerce were placed in the same hands: “The provisions of the law respecting native seamen and respecting ownership are as applicable to vessels carrying men as to vessels carrying manufactures, and no reason is perceived why the power over the subject should not be placed in the same hands.”
In United States v. South-Eastern Underwriters (1944), Justice Hugo Black made a rather lame attempt to show the regulation of commerce included the business of insurance by completely misconstruing what Alexander Hamilton wrote in his 1791 opinion on the constitutionality of the Bank of the United States.
In footnote, Black quotes Hamilton’s words, “admit of little if any question” to falsely assert Hamilton was suggesting the “federal power to regulate foreign commerce included ‘the regulation of policies of insurance.'” Justice Black omits the important fact that Hamilton was not directly describing the regulation of foreign commerce but speaking of the nations maritime power for which such insurance over shipping falls.
In his opinion, Hamilton said the regulation of commerce comes under four headings for which the business of insurance does not fall under because Hamilton describes the power as a taxing power with the incidental power to aid the collection (customhouses):
- To prohibit them (nations) or their commodities from our ports (imposing prohibitory duties or embargo).
- To impose duties on them where none existed before, or to increase existing duties on them.
- To subject them to any species of custom house regulation.
- To grant them any exemptions or privileges which policy may suggest (low or no duties on particular articles or tonnage).
After highlighting these four proper headings of regulating foreign commerce, Hamilton argues these headings “omits every thing that relates to the citizens, vessels, or commodities, of the United States.” Hamilton then goes into a laundry list of omissions that turns out to be those exact powers exercised by nations under their maritime jurisdiction, example: “The regulation of policies of insurance; of salvage upon goods found at sea; and the disposition of such goods.” And, “[o]f the power of regulating the manner of contracting with seamen, the policies of ships on their voyages, &c. of which the act for the government and regulation of seamen in the merchant service is a specimen.”
It is obvious from Hamilton’s list of omitted powers he was speaking of those powers exercised over marine affairs since little, if any, had any direct application to dry land. Additionally, these powers had no connection to laying taxes on articles of import which Hamilton himself had acknowledged was the sole method of regulating commerce.
Maritime jurisdiction would exist without any mention of regulating commerce because it is a custom of all mercantile nations for the national power to manage affairs of the sea. On the other hand, Congress could not regulate commerce without being specifically empowered because otherwise it would have been a reserved power remaining with each State to exercise like they had after the revolution and because it isn’t a part of law of nations.
The power to proscribe what articles of imports shall be restricted or prohibited through the laying of duties on imports for purposes of protecting or promoting American manufactures and the rules for executing this power was the only power acknowledged, approved and adopted. Rules for executing this power can include customhouse regulations, pilotage, forfeitures, laws against smuggling (avoiding customs), navigation points, etc.
Because the power acts only on commercial intercourse “between” separate powers, limits the power to importation and anything that could burden the introduction of imports through taxes. Only Congress is authorized to burden the introduction of foreign imports.
The sole purpose behind the regulation of commerce “between” powers being for the promotion or protection of manufactures against foreign competition dispels the judicial fable of internal economic activities or markets of States is related to the commercial intercourse “between” them.
This explains why Congress never showed any interest over internal commercial activities among the States or their markets as evidenced by the lack of any laws over the subject or acts of acquiring and maintaining vital data over commerce among the States. On the other hand, the entire interest of the nation, as a nation, was with foreign commerce where rules were made and statistics kept.
As a consequence of the power to regulate commerce among the States being void of any affirmative powers for Congress to exercise over the States, and because the power is limited to laying a tax on imports, the power cannot be appealed to in order to make any act of Congress over markets or commerce of the States necessary and proper.
For the court to deny the purpose, custom and usage of the term “to regulate commerce” “between” States and nations in order to continue empowering Congress with greater authority over the States to do what is forbidden is repugnant to the Constitution.
Finally, I’ll leave the last word to Justice Story:
“If the constitution is to be only what the administration of the day may wish it to be, and is to assume any and all shapes which may suit the opinions and theories of public men, as they successively direct the public councils, it will be difficult, indeed, to ascertain what its real value is. It cannot possess either certainty, or uniformity, or safety. It will be one thing today, and another thing tomorrow, and again another thing on each succeeding day. The past will furnish no guide, and the future no security.
“It will be the reverse of a law, and entail upon the country the curse of that miserable servitude so much abhorred and denounced, where all is vague and uncertain in the fundamentals of government.”
Looks like national marine jurisdiction under law of nations explains the taxing of seamen wages for marine hospitals far better than commerce clause or power to provide and maintain a Navy theories. Since commerce was expressly exercised as a power to tax the physical goods of importation – and there are no exceptions that can be found – makes it a bad clause to resort to explain the withholding of seamen wages. I think because the US used its custom collectors to collect the tax makes some think it was a power under the commerce clause.
Power over the Navy doesn’t explain it as some exert because initially Navy personal were excluded and were given separate fund from seamen of merchant vessels in 1811.
Since affairs of the sea like contracts, salvage, insurance, vessel registration, liens, etc., clearly fell under the nation’s marine jurisdiction over the sea, best explains the authority to withhold a portion of seamen’s wages to maintain marine hospitals than any other theory. The fact it was unquestioned reaffirms this conclusion since any suggestion the commerce clause was improperly being resorted to for a new federal power always ended up in big disputes, e.g., internal improvement bills.
The fact it was an early petition of the Boston Marine Society that lead to marine hospitals funded by seamen wages ices it. Very good blog post this was – better than many law review articles of the subject.
Great Article. Oh I shared this post alright, on a news article on USAToday and also on my FB account with sourcing this page on my posts so that I was not the one taking the credit for my postings. I give credit to where the credit is due when I recite something. Once again, Great article. I helped me prove my points with facts and references from this article. Thank you !
That Randolph quote is a rusty dagger through the heart of modern day commerce clause jurisprudence. I don’t understand how justices can maintain their commerce precedents in the face of overwhelming evidence it is wrong.
Gibbons came down to whether the Coasting Act’s enrollment and licensing included steamboats in carrying passengers and not whether New York licensing ran afoul with any regulation of commerce like it is widely assumed to be the case. The Coasting Act was a marine act and not an act to regulate commerce. Kudos to Madison for being the rare few who see this huge distinction.
This has to be the most provocative commerce clause essay I have ever come across. Although the court will continue with its sun really orbits the earth mantra, this will give people a glimpse of how the universe is really structured.
I have researched the power over commerce before and never could discover how commerce was regulated by any other means than by duties and imposts on trade articles. I remember there was at least one Supreme Court ruling that said the marine power and regulation of commerce were two distinct powers unrelated with each other. Marshall saying the power is the same with nations as with states defines the power perfectly. Just my two-cents.
“it (regulation of commerce) must carry the same meaning throughout the sentence, and remain a unit, unless there be some plain intelligible cause which alters it.”
Game over.
I have always been partial to Madison’s explanation on why Congress was empowered to Regulate Commerce among the States and why Congress Lacks Affirmative Powers over Interstate Commerce
James Madison to Joseph C. Cabell
13 Feb. 1829 Letters 4:14–15
For a like reason, I made no reference to the “power to regulate commerce among the several States.” I always foresaw that difficulties might be started in relation to that power which could not be fully explained without recurring to views of it, which, however just, might give birth to specious though unsound objections. Being in the same terms with the power over foreign commerce, the same extent, if taken literally, would belong to it. Yet it is very certain that it grew out of the abuse of the power by the importing States in taxing the non-importing, and was intended as a negative and preventive provision against injustice among the States themselves, rather than as a power to be used for the positive purposes of the General Government, in which alone, however, the remedial power could be lodged.
Article 1 Section 8
To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;
Obvious to anyone who reads. The federal government has the power to regulate commerce between the States, that is state laws governing commerce. It does not say the feds have the power to regulate commerce between individuals and individuals and the state, which would result from an individual mandate. Interpreting the clause in this manner would make a sham of the individual liberties enshrined in the constitution by the founders .
Thomas Jefferson to George Washington on the Constitutionality of the Bank of the United States, 1791,
“For the power given to Congress by the Constitution does not extend to the internal regulation of the commerce of a State, (that is to say of the commerce between citizen and citizen,) which remain exclusively with its own legislature; but to its external commerce only, that is to say, its commerce with another State, or with foreign nations, or with the Indian tribes.”
Spot on. Let’s just hope the Supreme Court sees that and makes it clear to congress that they have over stepped their bounds with the healthcare mandate between individuals in the sale of goods.
I’ll ask the same question I did under Orin Kerr’s post over on Volokh Conspiracy and received no answer:
Why isn’t there a court test to determine a laws constitutionality by whether the law can be equally applied to regulating foreign commerce since Marshall said the power is identical between states and nations? All the court would have to do is ask whether Congress has the power to mandate Chinese citizens to purchase insurance.
@J. Aldridge:
While such a test would be commanded by the text of the clause, the court won’t do it for the reason such a test would bring down their entire house of cards that is built upon fiction. Keep in mind all the justices are under immense pressure from all sides to maintain certain fictions (aka “precedent”). They are no longer sent to the bench to uphold the constitution but to defend certain political machinations.
Check out footnote 122 on page 154 of the 11th circuits ruling:
Judge Stanley Marcus the Clinton appointee justifies upholding the individual mandate like this:
Pretty clear Marshall was talking about the rules of prescribing duties on what imports. I don’t see how these rules are supportive of the insurance mandate.
Riveting analysis. This will be what daylight is to a vampire for court justices. They’ll cover their eyes and seek darkness.
This is a epic analysis of the power. Just came from the SCOTUSblog after reading scholar arguments of the constitutionality of the mandate but found this to be the more convincing argument.
Damn awesome explanation that shows the framers left no wiggle room to elevate the power beyond restricted taxation over imports.
This essay most effectively shreds Yale’s Jack Balkin’s commerce thesis all to pieces leaving it lifeless.
@Terry:
Not just Balkin’s theory but many, many more. What I find interesting is Madison does it without aid of any overdrawn, unsubstantiated claims that are typical of many commerce theories. This I think shows the conclusions herein are accurately drawn from the history of the clause.
That is actually a very interesting essay J. Aldridge links to from volokh.com that brings up some serious points over the extent of congress’ commerce powers. I’m not sure if there is any current commerce scholars who are fully aware of this confusion over maritime powers of nations with that of regulating commerce? Often the discussion of the licensing and enrollment in the coasting trade is treated as an act of regulating commerce when I am pretty certain it was viewed as an exercise of the marine power. Larry Tribe has argued requiring seamen medicines was a commerce power exercise when it was actually marine jurisdiction exercise. Anyway, great link Aldridge provided.
One of the better commerce clause analyses I have ever read. I am sure, though, the justices on the court are aware of the limited extent of the power, but as others have mentioned, it really boils down to political considerations more than written law. In a perfect world the regulation would be viewed the same as Marshall viewed it in carrying the same power with states as with foreign countries and Indian tribes. Only public pressure is going to influence the court by publically calling into question court interpretation errors as Madison does here, and this might take years.
This presentation might just meet Kennedy’s threshold requirements for overturning erroneous precedent as he put forward in Citizens United. In any case, this provides the historical truth of the power and shows the court only dishonors itself in ignoring it.
@Dilbert:
I can vision Kennedy itching to declare: “Wickard was not correct when it was decided, and it is not correct today.”
Commerce clause jurisprudence has always been a black-eye for the court in that it has always lacked constitutional fidelity. The court is too political to decide commerce questions based purely on organic law.
IOW’s, what you can’t regulate with foreign nations can’t be regulated among the states (oh that has got to hurt!). Maritime points was significant.
Very impressive post, Mr. Madison.
Uncertainty. . . .which is the problem with the Obama administration. . .all the time.
Look – the guy just spews lefty nonsense all over. First came Obamacare and all it’s uncertainties. . .then the threat to use the EPA if he didn’t get cap N tax. . . and now, his nonstop whining and moaning about wanting to take more from those who make 250K and up. . . .
He just never shuts his mouth. . .and his administration keeps causing us problems – now with expanding the big government’s rights. . . . .
Libya. . . .anyone ever figure out if it’s illegal because Congress is the only body that can declare war. . . .anyone bother to stop Obama?
Hmmmmm?
Of course he doesn’t like the constitution (charter of negative liberties). . . .he’s expanding the federal government’s authority. . and now wants more taxes. . .
Not based on tax rates, but the “nebulous” definition of fair.
What’s fair? What’s “certain” about something called “fair?” Hmmm?
for instance, blithering Obama said one of his buddies who made 175K as “modest”. . . .but ohhhh nooooo, 250K. . . .that’s billionaire and corporate jet “rich”. . . .
So – when he says “reward our friends and punish our enemies”. . .are you really going to hand Obama something as nebulous as “fair” for determination?
When his buddy is making almost 200K, that’s modest. . but for those of you who have your own little businesses. . .no, you’re “rich” to him. . . .
I would also warn the SCOTUS about a simple fact that sometimes, people in ivory towers forget. . . .
You’re only in that ivorty tower because of the Constitution. Once you start to ignore that constitution – the only source of your power, you essentially tell the rest of us that we can ignore the constitution also. . . and by extension. . . .anything you have to say.
Word of warning to the SCOTUS. . .if you ignore the constitution, we can ignore you, also. After all, without the constitution, you’re just a bunch of disconnected people sitting in your pajamas at a really big diaz. . . . .
@No One Important:
Seriously – what is “certain” about “fair” that Obama wants, hmmm?
“Fair” is determined by the political party de jour?
What is “certain” that our businesses can count on? Hmmmm?
Not tax rates – Obama is promising to raise them. He’s whining about wanting them raised now.
Threats from the EPA? Nope – can’t count on Obama listening to what the elected officials say – he’s going to do everything by fiat. . .
Ignoring a federal court order to release oil drilling permits? Gee, most of us would be in jail if we ignored a federal court order. . . .
But not Obama/Salazar, huh?
So – can businesses count on the federal government honoring the courts?
Of course not.
Can they count on Obama understanding that the house changed hands to stop him from doing the things the nation wanted stopped?
Of course not – he’ll do it by fiat.
Ask yourselves now – does anyone really expect our nation to recover while Obama is at the helm?
Of course not.
And the SCOTUS would do well to take notice. . . . .
@No One Important:
you reply to yourself after a tea nutter rant? Makes perfect sense.
Great article; consider also that prior to the New Deal’s AAA & Wickard Federal forays into intrastate markets required a Constitutional Amendment for liquor & Slavery.
This is beautiful! Ranks right up there with the Declaration of Independence and Gettysburg Address 🙂
You know commerce clause jurisprudence must be nothing but pure judicial activism when 220 years after the adoption of the Constitution groups must petition the court to ask what is “meaningful limitation on congressional power under the Commerce Clause.”
I think every justice on the court should be required to read this post.
This extraordinary description of the power of regulating commerce causes me to alert a law journal to it.
I want to shoot holes in this post but I am coming up with blanks. Some heavy lifting here.
No holes because PA Madison’s arguments are bullet proof!
Pretty convincing arguments. I always wanted to know what the heck were the “rules” Marshall was talking about in Gibbons that was part of the regulating power to prescribe. Being a taxing power fits the power like a glove.
P.A. Madison takes the United States Supreme Court out behind the proverbial woodshed and gives them a royal whupping. Gold!
The court ignores commerce clause facts like the fact it is the same regulation among the states as with foreign nations, etc. They do this in order to avoid the limitation the people put upon the power. Madison has the right description for this sick game: Judicial corruption.
Figured this would be another anti-tax protest kind of argument–boy was I wrong. Great essay that makes great points, especially doing justice to Marshall in Gibbons v. Ogden. Arguing the power can only be one of “taxation” on intercourse “between” sates or nations was more than persuasive.
This seems to suggest Amazon has a weak argument with its “web affiliates” are out-of-state commerce facilitators who happen to be located in state. I can’t see any objection with Calif taxing them other than it is a stupid tax that will hurt the state more, but not afoul with the commerce clause. The State would be just laying a revenue tax on a point of sale within the state and not any act to burden other states imports/exports as they are transported through the state to market.
The issue is really one of buying and selling and not commerce between the states themselves.
The Court better pray the MSM doesn’t pick up this post because the last thing they want to do is have to defend their precedent in public and against facts.
Abolish TSA and return airports back under state jurisdiction where it belongs.
I had to go back and carefully reread Gibbons v. Ogden after reading this post. Marshall never defined the power with the states and just refers to the power over the states as “whatever it is.” He speaks of the regulation of foreign commerce exclusively.
I think P.A. Madison may be onto something significant here.
This article smacks you right in the solar plexus and leaves you speechless. Probably because it’s the truth.
@Topeka Man:
It leaves you speechless because Madison disposes of current commerce jurisprudence so effectively that no amount of precedent can counter. The truth is current commerce doctrine is based on lies and not law.