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What Would Happen if the Dormant Commerce Clause Were Overruled?

With the debate in the Wynn case over the Dormant Commerce Clause, Michael Greve has once again criticized originalists for their views on the matter.  Michael likes the Dormant Commerce Clause.  As a policy matter, so do I.  What’s not to like about a doctrine that prohibits or restricts states from engaging in protectionist and other similar actions?

But I am not so sure how important the doctrine really is as a practical matter.  Unlike other constitutional law doctrines, that of the Dormant Commerce Clause does not restrict Congress.  If Congress wants to authorize states to engage in protectionist legislation, it can do so.  And Congress has, most famously in the case of insurance with the McCarran-Ferguson Act.

So the Dormant Commerce Clause Doctrine only has effect when Congress is silent.  Is this a big deal?  After all, what stops the states from getting Congress to approve their discriminations?  Presumably, two things.  First, it is difficult to get a busy Congress to act regularly to do anything, let alone state discriminations.  Second, it is easier to stop Congress from passing a law than to get it to pass one.  Only a single vetogate can stop a law – not only one house (or a presidential veto), but a single committee can often do the job.  So the Dormant Commerce Clause is consequential, because it is too difficult for states to get Congress to act to approve their discriminations.

What are the implications of all this for the elimination of the Dormant Commerce Clause?  It means that the Clause is really no different than a statute passed by Congress that prohibits or restricts discrimination by the state.  So, if the doctrine were eliminated, all that would be necessary is for Congress to pass a single law re-establishing the doctrine.  How likely would that be?

There is no way of knowing for sure, but I think there is a pretty strong argument for concluding that such a law would pass if the Supreme Court eliminated the Doctrine.  First, there would be strong incentives for the people and even the states to enact such a law.  It is true that different states have specific incentives for their particular discriminations, but as a general matter the states lose from this arrangement and the people as a whole certainly do.  So by considering the issue as a whole – where each state can see the overall benefits from stopping the other states from discriminating as well as the harm to them from not being allowed to discriminate – the benefits should be seen as outweighing the costs, for the states presumably and for the people certainly.

Second, the ability to pass a Dormant Commerce Clause statute would be helped by the existence of a focal point – the prior Dormant Commerce Clause doctrine.  One problem with negotiating a new statute would be figuring out what it should look like.  What should be the protection that it provides?  What exceptions should be allowed?  Different states would have different interests.  But if there were an obvious rule to enact – one that stood out and above those different interests – what game theorists call a focal point – this would greatly enhance the ability of the different interests to agree on a single result, the focal point.

Third, the pyschological phenomenon of loss aversion and the endowment effect also suggest that a Dormant Commerce Clause statute would be enacted.  These psychological characteristics say that people place great value on what they already have and will often be motivated to prevent the loss of these things.  As a result, a political debate following the elimination of the Dormant Commerce Clause would be likely focused on the people retaining their lost rights.  This case for replacing the Dormant Commerce Clause – much like the case for the Religious Freedom Restoration Act – would have a strong appeal.

In the end, it is quite likely that a Dormant Clause Clause statute would be enacted and would accomplish much of what the Clause does now.  Perhaps I am wrong, but this is a question that must be addressed.  We should not assume that the sky will fall, unless we have good reason to believe it will.

Reader Discussion

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on May 26, 2015 at 16:11:16 pm

The governmental theories discussed here are interesting, to say the least, but are the jurists really going to voluntarily give up some of their power to declare (as opposed to "enact") national common laws? I don't see any incentives for doing that.

Was it the original understanding that natural laws between the states would be part of a national common law?

Since the Framers were well studied in the laws of nature, I would assume that they had such an understanding. Which would mean that common law declarations and rulings by the Court would have been an original intent.

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Scott Amorian
on May 27, 2015 at 02:09:11 am

Lately I have become a lot more skeptical of the dormant commerce clause. But I do think the doctrine is right for expressing what the founders believed they were doing in enacting the constitution (from reading their writings). The court just picked the wrong clause to attach the correct doctrine to. It should instead be the Import-Export Clause (Article I, Section 10, Clause 2). And laws like the taxing law in Maryland in the Wynn case would be unconstitutional as they are practically a tariff (like the majority opinion says), and as such they are an impost which a state cannot enact without congressional approval. I'm not so sure about the "balancing" test under the current doctrine, but at least facially discriminatory laws which are favoring in-state economic interests over out-of-state interests are practically an impost and unconstitutional without congressional approval.

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Devin Watkins
on May 30, 2015 at 00:31:12 am

The power of this clause (assuming we're talking about "interstate commerce", which is what I gather from the sound of it) is not meant to be practical within the context of the civil law and procedure, etc. What its meant for is criminal law. Because of the interstate commerce clause, it becomes an option to charge a person with a federal crime where the criminal conduct occurred "through an intestate commerce". The most notorious examples of this techinique is gun law. If a state has either lost its case, entered into a plea bargin, or for whatever reason entered a nolle prosequi, then if the federal government can prove that a firearm has "traveled in interstate commerce", then it may charge a defendant with a federal gun crime, as has been demonstrated many times. The thing is, that because nothing, as far as can be seen, limits the "interstate commerce" clause (The supreme court has historically been extremely reluctant to do this), the theory extends to all purviews of criminal law, where it is possible to allege "interstate commerce". From the civil side of things, the doctrine, while it may explicitly limit a state's power, the state has other options available within to regulate itself, within theory. Congress will at all attempts avoid using the interstate commerce clause to hold state rights as invalid, because the Supreme Court will generally side with the several states in such matters, as the constitution makes clear that the states are generally to govern themselves, without federal interference.

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John Doe

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