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The Modern Constitution Empowers Redistribution, the Original One Not So Much

Ganesh Sitaraman has written an oped in the New York Times arguing that our Constitution was not built for a society as unequal as our has become.  Even leaving aside the claim that our society is becoming substantially more unequal—one I have contested, the essay is mistaken.   First, the Constitution as amended today empowers the federal government to engage in regulatory redistribution and progressive taxation to reduce economic inequality.   Second, the Constitution of 1789 on which Professor Sitaraman principally focuses was consciously built to protect against legislative attempts to mandate more equality. The populist demagogues with whom the Framers were mainly concerned were those who would bamboozle the populous into debtor relief legislation and other wealth destroying schemes that could be sold, just as in our day, as aids to poor and retribution to the rich.   Sitaraman misunderstands both our contemporary Constitution and our original Constitution.

After the 16th amendment and the New Deal Court’s interpretation of the Commerce Clause, the federal government has plenary powers of income taxation and regulation. There is nothing to prevent the left wing of the Democratic party from making our income tax code even more progressive than it already is. (It is already one of the most progressive of OECD countries.) Nor is there anything preventing them from spending more of our money on their latest social engineering schemes. Only a vote of the House and the Senate and the signature of the President stands between us and government control of the health system through enactment of single payer.

Sitaraman nowhere acknowledges these vast federal powers–powers that have been used for redistribution again and again in the last hundred years.  He claims that the system thwarts a more egalitarian society because of such matters as our campaign finance system where rich people and corporations (like the New York Times, for instance) have the constitutional right to spend money to make their opinions heard. But most for-profit corporations spend little on political campaigns and there are many rich people, like Tom Steyer and George Soros, who fund the progressive agenda. If a left-wing Democrat gets the 2020 nomination, as is likely,  she will certainly be able to make the case for her economic program and, if she has a sufficiently left-wing Congress, enact that program.

One of the odd aspects of the essay is that Sitaraman contrasts our era with the late nineteenth century, where the levels of inequality were as great (his view) or substantially greater (my view) than our own. And at that time there was no federal income tax nor a federal administrative state. And yet according to his own reckoning, progressives were able to attack the evils of entrenched inequality, despite having a much harder hill to climb.

But nothing is as perplexing as his failure to discuss the most famous Federalist Paper, No. 10,  where James Madison, the Father of the Constitution, provided the most important analysis of economic inequality in our founding era documents. Did Madison make the assumption for our constitutional design that that wealth was or would remain relatively equal? Not at all. In fact, he stated clearly that the “first object of government” is to “protect the “diverse faculties” of men, including “the unequal faculties of acquiring property.”

Not surprisingly in order to protect those faculties the government Madison midwifed had substantial restraints against redistributive schemes–something Sitaraman also fails to mention. I have already noted that the federal government at the time lacked the powers of income taxation and plenary economic regulation that it now has. The Constitution prevented  the states from “impairing the obligation of contracts” to prohibit debtor relief schemes. While the states did have many other economic powers, these were restrained because they were in competition with one another for capital and people.  In short, the Constitution of 1789 was inimical to burdening economic liberty and thus constrained reducing  the inequality that the exercise of liberty may bring.  Sitaraman cannot be permitted to make the Constitution of 1789 part of a progressive campaign narrative.

Reader Discussion

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on September 18, 2017 at 08:41:58 am

Governor Morris had it dead right: “The rich will strive to establish their dominion and enslave the rest.” The rational capitalist government will create laws to mitigate this tendency. The Framers saw the problem, but understood that it was one they didn't need to solve.

GS [NYT]: "Toward the end of his life, Madison worried that the number of Americans who had only the “bare necessities of life” would one day increase. When it did, he concluded, the institutions and laws of the country would need to be adapted, and that task would require “all the wisdom of the wisest patriots.”

James Madison acquired the wisdom of age. lmagine that!

The Framers understood that wealth inequality was the bane of a republic. ln a letter to Madison, Thomas Jefferson wrote:

"The property of this country is absolutely concentered in a very few hands, having revenues of from half a million of guineas a year downwards. These employ the flower of the country as servants, some of them having as many as 200 domestics, not labouring. They employ also a great number of manufacturers, and tradesmen, and lastly the class of labouring husbandmen. But after all these comes the most numerous of all the classes, that is, the poor who cannot find work. I asked myself what could be the reason that so many should be permitted to beg who are willing to work, in a country where there is a very considerable proportion of uncultivated lands? These lands are kept idle mostly for the aske of game. It should seem then that it must be because of the enormous wealth of the proprietors which places them above attention to the increase of their revenues by permitting these lands to be laboured. I am conscious that an equal division of property is impracticable. But the consequences of this enormous inequality producing so much misery to the bulk of mankind, legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind. The descent of property of every kind therefore to all the children, or to all the brothers and sisters, or other relations in equal degree is a politic measure, and a practicable one. Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise. Whenever there is in any country, uncultivated lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural right. The earth is given as a common stock for man to labour and live on. If, for the encouragement of industry we allow it to be appropriated, we must take care that other employment be furnished to those excluded from the appropriation. If we do not the fundamental right to labour the earth returns to the unemployed. It is too soon yet in our country to say that every man who cannot find employment but who can find uncultivated land, shall be at liberty to cultivate it, paying a moderate rent. But it is not too soon to provide by every possible means that as few as possible shall be without a little portion of land. The small landholders are the most precious part of a state."

Free market economics does not solve this problem, and neither does our Constitution.

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Miss Creant
on September 18, 2017 at 10:20:26 am

"[P]art of a progressive campaign narrative" - this speaks for itself, and to the point of why it does not also speak to Federalist #10.

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Paul Binotto
on September 18, 2017 at 10:35:19 am

It would appear that this quote from Jefferson is a *favorite* among the leftists social justice warriors.
I would caution, however, that before one rejoices in this often (mis)used rejoinder in support of a redistribution scheme, that would have actually been anathema to Jefferson, that one undertake a serious study of just how well the yeoman farmer, of which Jefferson voices approval, actually fared under the agrarian system of government and economics that Mr. Jefferson advances.

There are ample scholarly studies of the individual landowner during antebellum (and pre-revolutionary) periods.
There lives were miserable, brutish, short and impoverished. In particular the Southern yeoman farmer was under the political and economic sway of the large landowner; credit, financing, etc were denied to him, he was unable to generate / acquire sufficient capital to expand, to purchase tools, animals, etc.

Let us not here fall into the utopian fantasy regarding the alleged paradise of the yeoman farmer.

I would also suggest that those who advance such a misguided prescription of redistribution, throw away their I-phones, laptops, PlayStations, etc - "cuz, brudda, you ain;t never would have had them if Mr. Jefferson had held sway."

It took capitalism and the much maligned "inequality" to produce the wonders of the world in which you live - yet bemoan!

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gabe
on September 18, 2017 at 11:10:27 am

Could it be that Prof. M is cherry-picking Madison? ln context, the quote he relies on is part of an explanation of the origin of faction:

"From the protection of different and unequal faculties of acquiring property, the possession of different degrees and kinds of property immediately results; and from the influence of these on the sentiments and views of the respective proprietors, ensues a division of the society into different interests and parties.

The latent causes of faction are thus sown in the nature of man."

From GS's perspective, there is nothing left to address. He has already taken Madison's view into account, and it does not appear to comport with Prof M's reading of F10.

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Miss Creant
on September 18, 2017 at 11:33:25 am

Of course, we can't know this, can we, as GS has failed to address what you purport that he has already dismissed. The burden certainly is on GS to settle, as it is on Prof. M to defend against such accusation as advanced. I am content to let's hear from each of these Scholars, that we may know precisely what heretofore is only presumption.

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Paul Binotto
on September 18, 2017 at 11:57:23 am

Yes, BUT....

You ought to understand that Madison, as with many of his contemporaries, both recognized AND accepted the *inevitability* of "factions. Utopians, these men were not and rather than attempt an overly restrictive scheme, one that would have severely limited the ability of the citizenry to accumulate capital - or more precisely, to allow each citizen to make the fullest of their individual capacities / talents / intellect - the Framers designed a system that, if successful, would allow for the development of faction but would be so structured that "faction would engage faction" and limit the mischief.

Let us give credit to Madison - not for any one of a number of quotes to be used in the never ending "dance of dueling quotations" but rather for the perception / vision to create a system that would recognize the reality of *human frailty* and use that very frailty to limit mischief.

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gabe
on September 18, 2017 at 16:50:57 pm

Oops - and then there is this from Dallas, Texas:

A Dallas area high school, named after the Father of the Constitution, is on a list of schools / public facilities to be renamed so as not to cause offense or celebrate the oppressive nature of American political regime.

AND this presented on the anniversary of the ratification of Mr. Madison's great craftmanship!!!!

Apparently, Miss Creant is skating on thin ice when she quotes Mr. Madison, that infamous and oppressive bastard son of some Beardian oligarchs! HA!

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gabe
on September 18, 2017 at 17:24:30 pm

ls there an issue raised by F10? l would be inclined to dismiss Prof. M's clams out of hand, as it appears that he took Madison out of context. ln your words, he "misrepresent[ed] them to [his] advantage, as prelude to [his] own tirade ... [and] enjoy[s] the sound of [his] own reasoning…."

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Miss Creant
on September 18, 2017 at 17:56:25 pm

Only YOUR utopian fantasies are acceptable???

Let us not here fall into the false dichotomy that there is only one brand of capitalism, and one of socialism. Australia and Canada are more socialist, without (unlike Seattle) boasting statues of Vladimir Lenin. There is plenty of room for capitalism and redistribution of wealth to peacefully coexist.

Both Jefferson and his protege understood why they have to.

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Miss Creant
on September 18, 2017 at 18:06:54 pm

Even though it has ultimately failed. Capitalism has a natural tendency to devolve into fascism, as oligarchs eventually capture the government and re-write the law for their benefit. Madison couldn't stop that, and it was the cause of its failure.

lf credit was to be given, it would belong to Montesquieu. But our system is hardly a rousing success. No one has copied it for fifty years; new nations prefer the parliamentary model, which is in many ways superior.

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Miss Creant
on September 18, 2017 at 20:00:56 pm

In support of John McGinnis's basic point, John Adams, in an 1813 letter to Thomas Jefferson, deprecated the "absurd" reasoning of Rousseau and stated that "the golden rule; do as you would be done by; is all the Equality that can be supported or defended by reason, or reconciled to common Sense." See http://press-pubs.uchicago.edu/founders/documents/v1ch15s59.html

Of course the Golden Rule, enshrined in English jurisprudence, was a fundamental element of the "laws of nature and of nature's God," as understood by the founders.

Somebody wrote, "lf credit was to be given, it would belong to Montesquieu" -- as a popularizer and summarizer of Burlamaqui, of course.

To quote from page 1 of Ray Forrest Harvey's "Jean Jacques Burlamaqui: A Liberal Tradition in American Constitutionalism":

"If the most essential principles of our constitutionalism can not be logically derived from Locke’s teachings and only to a small degree from Montesquieu, and if, on the other hand, these principles, in what is normally regarded as the peculiarly American form, are found elaborated in Burlamaqui’s work, a presumption is established that the theoretical discussion of the latter influenced the development of the practical political doctrine."

And from pages 48-49: "It is generally accepted that the philosophy of Locke furnished the theoretic basis for the American theory of constitutional government. It may, however, be confidently asserted that it is impossible logically to deduce from Locke’s doctrine such characteristically American principles as the written constitution, as the people’s grant of power to government, personal separation of powers, coordinate departments, checks and balances, limited legislative power—except as limited by the natural rights of life, liberty, and property—and, most American of them all, judicial review. Instead, the earliest theoretic statement of these principles as a systemized method of government, with the exception of the last, which was at least adumbrated, is contained in Burlamaqui’s 'Principes du droit nature,' 1747."

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John Schmeeckle
on September 19, 2017 at 11:34:27 am

An interesting article, however, I would take exception to the conclusion that Mr. McGinnis makes concerning the 16th Amendment, to wit: “After the 16th amendment . . ., the federal government has plenary powers of income taxation . . . .” The Court record is clear that the 16th Amendment gave the government NO new powers respecting taxation. One of the early cases decided by the Supreme Court in both Brushaber and Stanton [240 U.S. 103, 1916], both written by Chief Justice White, made it clear that “it was settled that the provisions of the Sixteenth Amendment conferred no new power of taxation, . . .” When Mr. McGinnis uses the word “plenary” to the use of government’s authority to tax, this disregards the well settled fact that the authority of Congress to tax IS LIMITED.
In Chief Justice Marshall’s opinion in M’Culloch [17 U.S. 316, 1819] he points out that “. . . the article of taxation itself, is subordinate to, and may be controlled by the constitution of the United States.” Justice Field, concurring in the opinion of the Chief Justice in the Pollock case [157 U.S. 429, 1895] writes: “As stated by counsel: ’There is no such thing in the theory of our national government as unlimited power of taxation in congress. There are limitations, as he justly observes, of its powers arising out of the essential nature of all free governments; there are reservations of individual rights, without which society could not exist, and which are respected by every government. The right of taxation is subject to these limitations.’”
Returning to Chief Justice Marshall’s opinion, he noted that taxation “. . . may be exercised upon every object brought within its jurisdiction. This is true. But to what source do we trace this right? It is obvious, that it is an incident of sovereignty, and is co-extensive with that to which it is an incident.” Marshall goes on to explain the limitations of “sovereign” authority and taxation. At page 421 he states “. . . that the powers of government are limited, and that its limits are not to be transcended.” The general tenor of M’Culloch deals with the relationship of federal vs. State authority in taxation, however, the Chief Justice explains a common law principle that applies to all agencies of government; “that the power of taxation . . . is an incident of sovereignty” and that “[i]t may be exercised upon every object brought within its jurisdiction.” “All subjects over which the sovereign power of a state extends, are objects of taxation; but those over which it does not extend, are, upon the soundest principles, exempt from taxation. This proposition may almost be pronounced self-evident.” He then explains the extent of sovereign powers: “The sovereignty of a state extends to everything which exists by its own authority, or is introduced by its permission; . . .” [429]
A third limitation of the power of taxation by the federal government is found in the Constitution Article I, Section 8, clause 17 and that is the legislative powers of the federal government, which again are limited. As directed by that contract, Congress is authorized “To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings; . . ." So the legislative authority of Congress extends only over the District of Columbia and “all Places purchased by the Consent of the Legislature of the State. . . .” Simply put, unless authorized by the States, all legislation enacted by Congress has no application to persons or property within the States.
The Court has made it clear that “all legislation is prima facie territorial.” [Justice Holmes, American Banana Co. v. United Fruit Co., 213 U.S. 347, 1909] "Legislation is presumptively territorial and confined to limits over which the law-making power has jurisdiction." Sandberg v. McDonald, 248 U.S. 628. "Exclusive legislation is consistent only with exclusive jurisdiction." Surplus Trading Co. v. Cook, 281 U.S. 647, 652. Justice McLean made it clear that: “Special provision is made in the Constitution for the cession of jurisdiction from the states over places where the federal government shall establish forts or other military works. And it is only in these places or in the territories of the United States where it can exercise a general jurisdiction.” [New Orleans v. United States, 35 U.S. 662, 1836] ". . . the United States have no constitutional capacity to exercise municipal jurisdiction, sovereignty, or eminent domain, within the limits of a State or elsewhere, except in the cases in which it is expressly granted." (Article I, § 8, cl. 17) Pollard's Lessee v. Hagan, 44 U.S. 212,223.; "Neither the Legislative, Executive and the Judicial departments of the Federal Government  can lawfully exercise  any authority beyond the limits marked out  by the Constitution."  Dred Scott v. Sanford, 19 How. 393.
The Founding Fathers understood that the purpose of the union was limited to the external affairs of the colonies, now called States. Justice Gray's opinion in the Legal Tender Cases refers to these as: "The sword and the purse, all external relations, . . ., are entrusted to its government." Julliard v. Greenmen , [110 U.S. 438, 1871]. To which Thomas Jefferson added: "To the united nation belong our external and mutual relations; to each State, severally, the care of our persons, our property, our reputation and religious freedom."
James Madison stated in a letter reported in the Federalist Papers, No. 45: "The powers delegated to the federal government are few and defined. Those which are to remain in the state governments are numerous and indefinite. The former will be exercised principally on external objects as war, peace, negotiation, and foreign commerce; with which the last power of taxation will, for the most part, be connected. The powers relative to the several states will extend to all the objects which, in the ordinary course of affairs, concerns the lives, liberties and prosperity of the state."
In Madison's letter (#41) also reported in the Federalist Papers: "That we may form a correct judgment on this subject, it will be proper to review the several powers conferred on the government of the Union; and that this may be the more conveniently done they may be reduced into different classes as they relate to the following different objects: 1. Security against foreign danger; 2. Regulation of the intercourse with foreign nations; 3. Maintenance of harmony and proper intercourse among the States; 4. Certain miscellaneous objects of general utility; 5. Restraint of the States from certain injurious acts; 6. Provisions for giving due efficacy to all these powers." During the debates in the Federal Convention of 1787 as reported by Madison, Mr. Sherman stated that; “[T]he objects of the Union, he thought were few, 1. Defence against foreign danger, 2. against internal disputes and a resort to force, 3. treaties with foreign nations, 4. regulating foreign commerce, and drawing revenues from it . . . .” These are sovereign powers held by the People delegated to the federal government.

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Sherwood Glazier
on September 19, 2017 at 11:46:59 am

Excuuuuse me! But WHAT utopian fantasies do I stand accused of?

Have you noit noticed that I consistently argue against any and all "one size fits all", "full-tilt-boogie" policy prescriptions (or PROscriptions)?

I simply wish to point out that one ought to be careful with ANY redistributionist scheme predicated upon the putative need for a more equal distribution of wealth (or for that matter, talents) as one example. consider that it is PRECISELY the UNEQUAL distribution of wealth / capital that has permitted the capitalist industrialized West to provide for the great enrichment of the mass of human beings over the past several centuries AND WITHOUT that unequal distribution of capital, resources would NEVER have been available to generate all the scientific advances. Would a yeoman farmer have the resources, talent or inclination to develop cancer drugs?, Apple computers, I-phones, automobiles, etc?

Nope, I simply prefer to OBSERVE the world as it is - with both its benefits and its blemishes!

Kindly cease imputing to me faults that are to be found in yourself or in those that you constantly caricature.

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gabe
on September 20, 2017 at 10:42:57 am

All of the propositions you quoted from pages 48-49, which I believe you are attributing to Burlamaqui, were throughly discussed by Parliament's Independent faction and their radically republican allies in the New Model Army's Army Counsel between April 1647 and December 1648. They were also debated in the still more radically republican Leveller and Digger pamphlets published in London between 1645-50.

They are also reflected or implicit in the Fundamental Orders of Connecticut of 1639 and the Massachusetts Body of Liberties of 1641. The Puritan settlers of New England were clearly front-running ideas that became central to the political struggle in England after 1645 and were again central in the US after 1783.

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EK
on September 20, 2017 at 11:34:42 am

"The populist demagogues with whom the Framers were mainly concerned were those who would bamboozle the populous into debtor relief legislation . . ."

It clear that the "factions" the high Whig framers were afraid of were the native Anglo-American republicans who soon became Jefferson's Democratic-Republicans. I assume McGinnis knows that the only wealth destroying scheme at the time was Hamilton's scheme to use the national debt to extract gold and silver from the countryside to engorge his Federalist allies - the merchants, bankers and planters. Hamilton founded the Bank of New York and the Bank of New York was the US governments first creditor.

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EK
on September 20, 2017 at 17:06:47 pm

"new nations prefer the parliamentary model, which is in many ways superior."

1) You must be a fan of Frank Buckley
2) Would that "superiority" include *Parleyment* being SUPREME?
3) Shall we have never ending "no-confidence" votes? - My Gawd, Imagine how many "What Happened" books the Fat Lady in a Pantsuit could write (Ok, have ghost-written for her). It could be a veritable remake of the old silent film series, "The Perils of Pauline [Hillary]"

Nope, I'll pass on it.

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gabe
on September 21, 2017 at 07:56:40 am

"After the 16th amendment and the New Deal Court’s interpretation of the Commerce Clause, the federal government has plenary powers of income taxation and regulation."

What does “regulate Commerce among the several States” mean ? Two readily available authorities tell us:  The Federalist Papers, written during 1787-1788 by Alexander Hamilton, James Madison, and John Jay, in order to explain the Constitution to the People and induce them to ratify it; and The Records of the Federal Convention of 1787 kept by James Madison.

These authorities prove that the purposes of the “interstate commerce” clause are (1) to prohibit the States from imposing tolls and tariffs on articles of import and export – goods & commodities – merchandize – as they are transported through the States for purposes of buying and selling; and (2) to permit the federal government to impose duties on imports and exports, both inland and abroad.

In Federalist No. 22 (4th  para), Hamilton says:

“The interfering…regulations of some States…have… given just cause of…complaint to others, and…if not restrained by a national control, would be multiplied… till they became… serious sources of animosity and… impediments to the intercourse between the different parts of the Confederacy. ‘The commerce of the German empire…is in continual trammels from the multiplicity of…duties which the several princes and states exact upon the merchandises passing through their territories, by means of which the…navigable rivers [of]…Germany…are rendered almost useless.’  Though the…people of this country might never permit this…to be… applicable to us, yet we may…expect, from the…conflicts of State regulations, that the citizens of each would…come to be…treated by the others in no better light…”

In Federalist No. 42 (9th para), Madison says:

“…A very material object of this power [to regulate commerce] 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…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…”

See also Federalist No. 44 (8th para) and Federalist No. 56 (6th para), to the same effect.

Madison’s Records of the Federal Convention of 1787 show:

Thursday, August 16, 1787:

“…Mr. Madison. 1. the power of taxing exports is proper in itself, and as the States cannot with propriety exercise it separately, it ought to be vested in them collectively…3. it would be unjust to the States whose produce was exported by their neighbours, to leave it subject to be taxed by the latter. This was a grievance which had already filled [New Hampshire, Connecticut, New Jersey, Delaware, and N. Carolina] with loud complaints, as it related to imports, and they would be equally authorized by taxes by the States on exports…”

See also Tuesday, August 21, 1787 for Mr. Ellsworth’s comment that the power of regulating trade between the States will protect them against each other, and Tuesday, August 28, 1787 for Gouverneur Morris’ comment that the power to regulate trade between the States was necessary to prevent the Atlantic States from taxing the Western States.

The evidence is ample, clear and unambiguous!  Furthermore, five clauses in the Constitution: Art. I, §8, cl.1; Art. I, § 9, cl.5; Art. I, § 9, cl.6; Art. I, §10, cl.2; & Art. I, §10, cl.3, give express effect to these two purposes of the “interstate commerce” clause.

The clause is not a blank check for Congress or the Court to fill out any way it wants!

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Jim Lewis

Law & Liberty welcomes civil and lively discussion of its articles. Abusive comments will not be tolerated. We reserve the right to delete comments - or ban users - without notification or explanation.