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No Brooding Over the Upside-Down Constitution

The generous comments offered by the respondents in this forum cover seemingly disconnected themes of The Upside-Down Constitution: constitutional jurisprudence (Jack Balkin); Erie Railroad (Aditya Bamzai); competitive federalism (Justin Walker and Benjamin Lee). My self-imposed assignment on redirect is to stress, yet again, what my reviewers remember all too well: it all hangs together.

Jurisprudence, Erie, and Structure

Jack Balkin embraces my take on constitutional understanding. He rightly notes that it was advanced by James Wilson, James Madison (pre-Virginia Resolution), and other leading Founders—before, alas, it gave way to the Jeffersonians’ crabbed “strict construction.” I broadly agree but I don’t think that is quite right; and our disagreement (which would likely dissolve in a cordial kaffeeklatsch) may bear on broader jurisprudential themes. Sure: Jeffersonian practice often reflected the Constitution that Jefferson wished he had written in 1787 (when he was canoodling in Paris, to our country’s good fortune), and rhetorically it often took on a “strict constructionist” hue. But no trace of it appears in the Marshall Court’s constitutional jurisprudence. The landmark decisions all reflect the grand style of argument Jack and I cherish: from the nature of the instrument to its clauses and the formulation of constitutional doctrine. Marbury, McCulloch, Hunter’s Lessee, Gibbons, Osborn v. The Bank, Fletcher v. Peck: same riff, every time.

Perhaps for that reason, “strict construction” has rarely found many prominent adherents among originalists. (Justice Scalia, for one, loathed the term.) Rather, the albatross that hangs around clause-bound originalists’ necks is Justice Oliver Wendell Holmes and his legal positivism. Their lodestar isn’t some non-existent antebellum “strict construction” case. It is Erie Railroad (1938) and its encomia to Holmes’s burble about law as the “command of the sovereign” and the common law as a “brooding omnipresence in the sky,” which of course we are not allowed to have.

Erie Railroad’s practical import and its broader significance is the subject of Aditya Bamzai’s comment. With customary grace and elegance, he goes CivPro and FedCourts on the Forum’s readers. I shall respond in those terms, with the excuse that Aditya started this.

Erie holds that in diversity cases where no federal substantive rule or positive state law controls, federal courts must follow the common law of the state where they sit, not the federal “general” common law that had governed such cases under Swift v. Tyson (1842) and indeed long before. The choice obviously matters when the law varies greatly among states. But how important is it nowadays, when preemptive federal statutes and the American Law Institute’s various Restatements of (state common) Law occupy and harmonize a vast swath of Erie’s ground? Opportunistic plaintiffs, Aditya suggests, usually shop for a favorable state judge or jury, rather than the forum’s law. That may well be right. But it may be the wrong way to look at the Erie problem.

For starters, I am not quite as sanguine about the empirics as Aditya seems to be. A federal preemption statute is simply an invitation for state regulators and the trial bar to navigate around the rule. The California Air Resources Board evaded an ironclad federal rule barring any state standard “relating to motor vehicle fuel efficiency” by relabeling that very same standard a “global warming” standard. More to the point at issue, trial lawyers evaded an ironclad federal preclusion of lawsuits claiming fraud “relating to the purchase or sale” of a security by asserting, in hand-picked state courts, a cause of action they called “fraudulent inducement to the holding” of such securities. (Eventually, Congress bestirred itself to block that maneuver, too.) Marginal cases? Maybe. But the margins are consequential and the game is asymmetric: anti-harmonizers have to win only once, while the defendants must run the table in jurisdictions picked by their foes.

As for Restatements: most directly relevant is the Restatement of Conflicts, governing Erie’s universe—that is, cases where more than one jurisdiction’s law can apply. Some state courts purport to follow the First Restatement; others, the Second Restatement; yet others, an “interest analysis.” What harmonizes this hodge-podge is the fact that in all but the funkiest cases, state courts will give all credit to their home state law, and none to sister-states’. That biased choice then follow defendants into the federal courts, with depressing and predictably plaintiff-solicitous results in product liability and other such cases.

I also doubt that one can isolate Erie Railroad so easily. Once federal courts must follow state courts on substantive common law rules, maybe that is also true of the states’ choice-of-law rules (“home state wins”) and their long-arm jurisdiction over out-of-state parties (“to the ends of the world”). The Supreme Court, Aditya acknowledges, soon realized that a world in which every jurisdiction sets rules for the planet can’t really work, and he notes some of the Erie “exceptions” that he and I teach in the same course, from the same textbook: federal common law rules for government contracts. Maritime law. Foreign affairs. Cases among states. And so on. You create enough “exceptions,” well then, it looks like Erie no longer matters all that much. But the endogeneity problem stares you in the face.

And there is an originalist-textualist price to pay. For a single example, the Federal Arbitration Act (FAA) essentially commands federal courts to enforce private arbitration agreements. (Any consumer contract these days will provide for dispute resolution outside the judicial system.) The modern Court, meaning decisions after Cindy Lauper’s hit recording of Girls Just Wanna Have Fun (1983), has held that the FAA establishes a very firm but wholly a-textual and ahistorical “presumption in favor of arbitrability.” It has further held that the FAA preempts any state law, positive or common, that might impede private parties’ ability to choose their arbitral forum and law. That notion had not occurred to the enacting Congress in 1925 or to any jurist in six decades thereafter. Then, it became nominally textualist gospel, declared in case after case. Can I defend those decisions? Not on grounds that my reviewers or I would count as above-board legal argument. The real defense is that no economy can work on Erie rules, and so the Court engineered workarounds. I am not wholly averse to underhanded legal maneuvers, and I believe that textualist-originalists, too, should be allowed to have fun on occasion. I am much more comfortable, however, in saying that Erie was indelibly wrong in the first place.

Econ

Judge Walker and Benjamin Lee ably explicate UDC’s economic strand of argument. You don’t have to be an economist to get the drift: so long as you can think like one, the Constitution makes a great deal of sense. That perspective invites the further thought that perhaps the Founders wrought better than they knew or had any way of knowing. Aditya Bamzai urges a note of caution on that score and doubts whether I can “directly derive” constitutionally grounded background rules of the Swift or Erie kind from public choice economics. Not in the way economists draw up monopoly costs on a blackboard, no. As Aditya readily acknowledges, though, UDC’s kindergarten econ is enriched by standard originalist materials; and once you do it that way, it turns out that the constitutional structure bears an uncanny resemblance to Jim Buchanan’s world.

Take the humdrum Swift issue. Contract dispute between parties from states with different law, no federal or state statute in sight: whose law governs? We know a few things. (1) states are equal under the Constitution, so courts cannot give a systematic preference to one or the other state. (2) States must give “Full Faith and Credit” to sister-states’ public acts. (What the Founders meant by ”full credit” is, such credit as civilized courts would give under the law of nations.) (3) Article III confers federal diversity jurisdiction to protect citizens of the United States against home-state bias. (4) Under the Constitution, citizens choose their state, not the other way around. (Thanks to Judge Walker and his coauthor for emphasizing that point and explaining much of what it entails.) All that in place, what of the case?

As a first cut, courts back then honored the parties’ contractual law and forum choices. In the absence of such an agreement, the courts sought to do—not in haec verba, but in substance—what modern-day economists would do: approximate the choice the parties would have made, had they thought about the matter. Very often, territorial and “vested rights” rules supply the answer. Married couples will want their arrangement to hold good out-of-state, and so their home-state law travels with them. In rem disputes over a piece of real estate are governed by lex loci because ex ante, no one would want it any other way.

I do hope that UDC’s constitutional structuralism will come to hold increased attraction, principally because structural cases have come to occupy an ever-increasing share of the federal judiciary’s docket.  

Those rules won’t work for things like the negotiable instruments of Swift fame, which may pass through hundreds of hands and dozens of jurisdictions before they become the stuff of litigation. In that predicament, the judge has a choice.

The court can go the Swift route: look to the ordinary legal materials—common law precedents, the law of nations, right reason, the practice of merchants—and make an independent judgment. Nothing brooding in the sky; it’s all on the ground. While the court may make mistakes, there is no reason to suspect that the judgment will be systematically biased, thus eliminating a risk that contracting parties would want to guard against ex ante. You still ask, in a Holmes-and-Erie state of mind, where the court’s power to declare the rule comes from? Why, from the same source that grounds the courts’ far greater power to declare acts of Congress unconstitutional: the Judicial Power of the United States of Article III. With it comes the inherent power to decide conflicts cases in the ordinary fashion—not because some Holmesian sovereign has crammed a rule of decision down the judiciary’s throat, but because that’s what judges had done all along and what the Framers expected them to do.  

The court’s alternative option is to apply the home state law of whoever sues first. That, by and large, is the Erie rule. In econ parlance, it maximizes the minimand: post-contractual opportunism. If it made any sense, some lawyer over the centuries would have written it into a contract. None ever has, which just about settles the question of whether Erie can possibly mean what it seems to say.

I would not want to push the econ jazz much farther than this simple demonstration. Then again I never have, and I don’t have to.

Originalism, the Future, and Me

Does the UDC state of mind and mode of constitutional understanding have real-world traction? Having rightly noted tensions that run through contemporary conservative originalism, Jack Balkin doubts that my insistence on constitutional structure and purpose “will resolve the emerging conflicts.” On a similar note, Aditya Bamzai observes that “[t]en years after The Upside-Down Constitution’s publication, we are still puzzling over the place of unwritten rules of interpretation in our constitutional order.“ All true. But I am neither surprised nor bothered.

For one thing, I’m just a small chimney amidst jurisprudential smokestacks that dwarf the Azov steel plant, pre-invasion. For another thing, ideological, methodological, and real-world tensions have accompanied (conservative) originalism since its inception. They have never produced a crack-up or purge, and a commendable tolerance for debate and dissent has been the movement’s strength. For a third thing, so long as we do in fact work through the conflicts and puzzle over unwritten background rules, I have done my small part in exorcising the Holmesian demon from the prostrate body of the Constitution.

That said, I do hope that UDC’s constitutional structuralism will come to hold increased attraction, principally because structural cases have come to occupy an ever-increasing share of the federal judiciary’s docket.  

The originalist dog has caught the bus, Jack Balkin rightly observes: see Dobbs, and see the college admissions cases later this term. Those, though, are rights cases. Oversimplifying a bit, they differ from constitutional structure cases in two salient respects. One, most rights cases are one-dimensional. The Equal Protection Clause forbids racial preferences, or it permits them. The right to abortion is in the Constitution, or it isn’t. Same with carrying guns. Whatever baubles you hang on the case, the reasoning remains analytic at its core. Two, conservative originalists have spent decades rehearsing the arguments, thus generating a certain mainstream orthodoxy.

Structure cases differ in both respects. They are often multi-dimensional. From the Steel Seizure Case to recess appointments to congressional subpoenas, every separation-of-powers case asks what the Court is doing in a quarrel between the political branches. Every federalism case about the vertical division of powers between the feds and the states is also a case about the horizontal relations between and among states. To make sense of this universe you have to think synthetically and put the constitutional pieces together. And that, unlike the rights business, is very much an originalist work in progress—perhaps, because originalism started as a rebellion against rights proliferation; perhaps, because textualism is inherently analytic; perhaps, because the separation-of-powers and federalism problems that now confront the country differ substantially from those of the 1980s.

At the risk of grasping at straws, though, I can detect signs of an incipient constitutional structuralism. Among them is a pending Supreme Court case, flagged with unerring instinct by Walker and Lee: National Pork Producers Council v. Ross. At issue is a California statute requiring that pork marketed and sold in the state must conform to humane production methods. Before meeting their Maker and the California market, pigs must have received a pen the size of my wife’s dressing room, a daily shower, and a variable gluten-free diet. (I exaggerate only slightly.) The only swine in California produce political rather than edible pork, and so the law applies almost entirely to places like Iowa and Nebraska, where people still slaughter pigs and otherwise work for a living.

Ever since Gibbons v. Ogden (1824), the basic idea has been that the Constitution’s Commerce Clause forbids, of its own force and without any congressional act, state laws that discriminate against interstate commerce; impose grossly disproportionate burdens on such commerce; or, as here, regulate on a wholly extraterritorial basis. Until 1983 or so, when latter-day originalist justices discerned that this “dormant” Commerce Clause is a wholly illegitimate judicial invention—the kind of constitutional common law forbidden by (you guessed it) Erie Railroad

The answer to that derangement is supplied in a splendid amicus brief on behalf of the Chamber of Commerce by Professor Michael McConnell (Stanford) and Steffen Johnson (Wilson Sonsini). Their opening paragraph merits exposition:

One fundamental presupposition of our system of interstate federalism is that States have authority only to regulate activities within their own jurisdiction. What happens in other States is the business of those States or—where goods or services cross state lines—of the federal government. (…) This fundamental principle is reflected in the overall structure of the U.S. Constitution and several of its specific provisions—including the Due Process Clause, the Full Faith and Credit Clause, Article IV’s Privileges and Immunities Clause, and (relevant here) the Commerce Clause.

The brief cites even supportive “dormant” Commerce Clause cases only in passing, for fear of triggering the Justices’ worst instincts and losing half the Court over a purportedly textualist obsession. Instead, it patiently walks the reader through the Constitution’s federal architecture and shows that indeed, all the pieces fit and belong together.

At one level, the lawyers’ work, however brilliant, makes your heart sink: they feel compelled, as indeed they are, to explain to the United States Supreme Court that Manhattan is not only an island but an island surrounded by water. On the upside, they can explain it, at long last.

‘Tis Advent, after all. Hope springs.