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New Deal Politics and Economics


“The issue of Government has always been whether individual men and women will have to serve some system of Government or economics, or whether a system of Government and economics exists to serve individual men and women.” This quote from FDR shows the crux of the issue. What system should people live in? A system where both institutions serve people in order for them to live life to the fullest. A system of politics where they could have equal representation via democracy or a system where “representation” is determined by how much money you have? There is an issue with this line of questioning because the government is not inherently democratic and most often is less representative of people’s needs or desires than the market. Another issue is to what extent can the government and the market serve the people? Does the government serve the people equally with the market or does the government serve the people more? How should the government serve the people and does the market have to do the same? How do we make sure that the power to serve does not become the power to dictate? FDR tried to answer these questions via the New Deal which consisted of legislation like the Agricultural Adjustment Act (AAA) and the National Industrial Recovery Act (NIRA). These acts were used by the government to regulate personal production and consumption but not without pushback from the people who sued the government and/or appealed to the Supreme Court. These acts made to serve the people ended up dictating people’s actions; even tangentially related actions were being restricted.

The Court decided in Wickard v. Filburn that Congress can regulate commerce; a power enumerated in article 1 section 8 clause 3 of the Constitution but includes its derivatives such as personal production and consumption. There were similar decisions made by the Court in prior cases. In U.S. v. Darby, the Court ruled that since lumber production was then sold across state lines Congress had the Constitutional authority to regulate that production and enforce minimum wage and overtime pay laws on Darby. However, there were also cases where the Courts made the opposite decision. In Hammer v. Dagenhart, the court ruled that Congress cannot regulate production and could only regulate explicitly interstate commerce. This case was about the federal government cracking down on child labor and argued that since the goods produced eventually entered interstate commerce, Congress could regulate its production line. In Wickard v. Filburn, the Court made a similar argument saying that since personal production and consumption of wheat affects interstate commerce of wheat then Congress had the authority to regulate personal production.

Since there are precedent cases in support of both sides of Wickard v. Filburn, it makes it difficult to say whether the Court ruled correctly. This discussion involves two main Constitutional interpretations; the first being that Constitutional authority must be enumerated; the second being that Constitutional restrictions must be enumerated. The former means that Congress can only do what the Constitution says it can do; the latter means that Congress can do whatever it deems necessary unless the Constitution says otherwise. Those in favor of the former interpretation bring up the 10th Amendment which states that power not delegated to the federal government by the Constitution is given to the states and the people. This amendment is only saying that power not expressly granted to the federal government automatically goes to the states, but it is not saying that the federal government cannot assume those unenumerated powers on its own, especially when the federal government invokes the necessary and proper clause.

Wickard v. Filburn is constitutionally confusing but logically disturbing. Taken to its absurd but logical conclusion the federal government can regulate absolutely anything and ought to regulate everything since everything affects interstate commerce in one way or another. We know the intention of the Constitution was to prevent such an outcome from happening, and so if we logically work backward we can see that the Court decision is wrong from a Constitutional standpoint. Then again, the Constitution does not explicitly restrict the government from going that far. The federal and even state governments should detach themselves from the market unless safety, health, labor, and property are being violated; price control, production quotas, and trade do not violate those essential protections and so those regulations should not exist. This would create a wall of separation between business and state where the market is free as long as it does not violate individual rights. Looking only at the commerce clause, Congress only has the power to regulate interstate trade and not the production of the goods that would be used in that trade. This interpretation should be the primary interpretation since it requires the least amount of additional conditions; this simpler interpretation was the primary one held by both Congress and even the Presidency before the New Deal.

The nondelegation doctrine is the concept that Congress cannot delegate legislative power to any other branch or to private individuals or to businesses. This doctrine was famously brought up in the Schechter Poultry Corp.v. U.S. a case where the court’s decision proved the efficacy of this doctrine in maintaining separated powers is flimsy. In the case of chicken production, the issue involved regulations not made by Congress but by executive agencies under the New Deal. The doctrine is weak today but could be reinforced with other political doctrines. The issue with the doctrine is that even if legislative power is fully reinstated in Congress the other branches and private interests can still propose laws that Congress passes without much debate. The nondelegation doctrine requires support and many things could be done to make Congress more efficient at handling legal issues without feeling the need to delegate power.

Succinctly, the government and economy should serve the people, however, both institutions should serve the people differently while being separated from each other. Congress does have the power to regulate the economy, specifically interstate trade, but shouldn’t regulate the entire economy; specific and necessary amendments could remove the power to regulate most of the economy especially when it comes to benefiting businesses. Any regulations made should be made directly by Congress and any changes made by the executive branch under the necessary and proper clause should be reviewed by Congress. Any appeals to executive changes should be brought to Congress and not to the Supreme Court. Congress needs to be better at passing laws and fixing problems; right now they aren't, which is why and how the executive branch is able to assume more power without much push back from the people or even Congress.

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