Ch. 3Business & The ConstitutionAudio Clip of Speech by President John F. KennedyCreated by Pamela S. Evers, Assoc. Prof., UNCW, for Educational Purposes © 2001 (w/updates)Definition and PurposeConstitution: (a) the structure of the government and its relation to the people under its authority or, (b) when capitalized, the written document establishing the structure and powers of governmentConstitutional law, then, is the body of law created by judicial interpretation of the ConstitutionSystem of Checks & BalancesThe U.S. Constitution establishes a tripartite (3 part) government structure: legislative, executive, and judicial branchesPurpose of system is to ensure separation of powers (“checks and balances”) so no one branch is omnipotentThe Federal SystemIn a federal system, the central government has power to administer national concerns, but states retain power to administer local concernsPower given by states to the national government are “delegated powers”:some exclusive to the national government (e.g., war), some shared (e.g., taxation)State Police PowerStates possess exclusive power to enact laws to protect general welfare, health, and safety State police power is limitedmay not unreasonably interfere with federal powersProtest of 2000 IMF talks, Washington DC“Enumerated” Federal Powers Give the Federal Government Power to:Regulate commerce (Art. 1, Sec. 8, Cl. 1)Tax: shared with states (Art. 1, Sec. 8, Cl. 1)Borrow: shared with states (Art. 1, Sec. 8, Cl. 2)Mint currency: exclusive to fed. govt (1,8, 5-6)Regulate banks: banks created under state laws, but regulated by federal government“Enumerated” Federal Powers Give the Federal Government Power to:Spend: to pay debts, provide for common defense and general welfare of U.S. (1,8,Cl.1)Own Businesses: rare, but federal and state governments may own businesses and sell and distribute government production (i.e., city-owned cable TV, energy corporations, or bond issuance to finance municipal activity)Federal PreemptionArt. I, Sec. 8 lists issues on which Congress may pass statutesThese are the enumerated powersMeaning: if Congress enacts a law on a certain issue, then Congress “preempts” state regulation of that issueFor example, a state cannot enact a law allowingdiscrimination based on race, religion, gender, age, or disabilityFederal SupremacyThe Constitution and statutes enacted by Congress (including treaties) are the supreme law of the land (U.S. Const. Art. VI, Cl. 2)Judicial ReviewIn Marbury v. Madison (1803), the Supreme Court interpreted the Constitution to grant federal courts the power of judicial review – the power to declare a statute or governmental action unconstitutional and voidIrony was that the statute in question gave the Supreme Court special powersThe U.S. Supreme CourtThe Court hears 3 types of cases original jurisdiction (e.g., state v. state)federal question cases from state courtwrits of certiorari (petition for review of lower court decisions)In the 2007 term, there were 8,241 petitions for review; 75 cases were argued and 72 were disposed of in 67 signed opinionsAnother 6,627 filings were in forma pauperis (those unable to pay costs), mostly from prison inmatesJudicial ReviewIn Youngstown Sheet & Tube v. Sawyer (1952), the Supreme Court used judicial review power to nullify an executive orderWhat were the facts?What was the issue? What was the result? Blast furnace #3, 1952Interpreting the ConstitutionOriginalism: Constitution is a bedrock and principles exist for all timeLiving Constitution: Constitution written in flexible terms and intended to change with timeDoes the Constitution Affect Business?Primary Applicable Clause: Commerce ClauseCongress has power “to regulate commerce with foreign nations, and among the several states, and with the Indian tribes”The federal power to regulate commerce limits states from interfering with interstate commerceCommerce Clause CasesThe Supreme Ct. expanded the power to regulate commerce with several decisions in the 1930s and 40s, including NLRB v. Jones & Laughlin Steel“. . . the recognition of the right of employees to self-organization . . . is often an essential condition of industrial peace.”And Wickard v. FilburnCongress may regulate any activity that has a substantial economic effect on interstate commerceDormant Commerce ClauseThe Supreme Ct. has consistently held that a state statute that discriminates against interstate commerce violates the Commerce ClauseHeart of Atlanta Motel case (civil rights)Fisheries and hazardous waste cases (access to resources and products)Camps Newfound case (tax breaks)Note: Political Winds Can ShiftReflecting a strong states rightsperspective, the 1995 Supreme Court decision of United States v. Lopez (re: Gun-Free School Zones Act) significantly expanded STATE power to regulate commerce US Supreme Court on day the Court announced their 2000 decision in the Florida election disputeConstitutional Limitations on GovtDue process: 5th and 14th Amendments to the Constitution prohibit nat’l and state govts from depriving any person of life, liberty, or property without due process of lawinterpreted liberally to be guarantee of protection from unreasonable procedures (procedural due process) and laws (substantive due process)interpreted to be guarantee of equal protection no protection if matter reasonably debatableConstitutional Limitations on GovtDue process (cont.): “depriving a person … of property” phrase known as the takings clausePalazzolo v. Rhode Island – controversial issue regarding environmental laws that arguably “take” land from the property ownerinterpreted to require just compensation in exchange for taking property through eminent domainConstitutional Limitations on GovtEqual Protection: 14th Amendment applies protection to states; modern interpretation of 5th Amend. refers to national governmentProhibits a government from treating one person differently from another without reasonable ground for classifying them differentlyWhat if US or State Congress Enacts a Law that Seems Discriminatory?• A “test case” challenges the law • Courts apply 3 levels of scrutiny in review of an allegedly unconstitutional statuteClarence Darrow & William Jennings Bryan during Scopes TrialLevels of ScrutinyMinimal: economic and social regsif classification has rational basis, it will standIntermediate: gender-based classificationslaw must substantially
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