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September 2014 Policy Study, Number 14-4

   

A Citizens Introduction to Federalism: Federalism and the Future of Constitutional Government

   

Part V: A Brief Historical Review of Federalism

   

 

The result was efforts by both the federal and state government to start regulating businesses such as the railroads and breaking big-business monopolies through legislation such as the Interstate Commerce Act and the Sherman Anti-Trust Act:

 

During the late nineteenth century and the progressive period, political forces pressed for national government activity in policy fields previously either left to the states or avoided by government altogether, such as economic regulation, highway construction, and conservation. The Interstate Commerce Commission (1887), the Pure Food and Drug and Meat Inspection Acts (1906), and the Federal Trade Commission (1914) began regulating commercial activities that had either been unregulated entirely or regulated by the states. Supporters of these federal efforts had two major arguments: some states had no regulation at all, thus endangering the safety and health of their citizens, and those states that did regulate differed widely in their requirements, thus making it difficult to conduct business equitably across state lines.[139]

 

During the late nineteenth century the calls for government regulation occurred from both agrarian populists and progressives who believed that the only force to oppose big business was the federal government.

 

The battle over regulation of the economy at both the national and state levels was also being fought in the Supreme Court. Herman Belz states that “fearing social upheaval, courts adopted a broad conception of liberty and property rights acquiring protection against economic regulation and working-class violence”:[140]

 

The ideas guiding free-market legal protection, known as laissez-faire jurisprudence, included security of liberty and property rights for individuals, entrepreneurial liberty, opposition to class legislation favoring particular groups in society, and recognition of business corporations as legal persons.[141]

 

The most famous decision of this era, Lochner v. New York, became the symbol of a Court that stood for the protection of economic liberty, liberty of contract (the right to negotiate in the economy freely), and limiting the role of government. The Lochner case dealt with a law passed in New York which limited the number of hours a baker could work in a bakery, and the Court struck the law down as unconstitutional.  

 

Progressives and agrarian populists criticized the Supreme Court for being judicial activists in favor of big business and worshipping at the altar of laissez-faire. Although the federal government was getting more involved with economic regulation, the government still did very little in terms of social welfare policy. It is important to keep in mind that during the late nineteenth century progressives started to push for social reforms such as a progressive income tax, direct election of Senators, eight-hour work day, minimum wage and workman’s compensation for workplace injuries, and other social reforms. Perhaps the best example was Democratic President Grover Cleveland’s famous veto of the Seed Corn Relief Bill. As Roger Pilon wrote:

 

In fact, James Madison, the principle author of the Constitution, made the point in 1794 when he rose from the floor of the House to object to a welfare proposal, saying he could not ‘undertake to lay [his] finger on that article of the Federal Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents.’ Notice that Madison was not objecting to benevolence. Rather, he was making a point about constitutional principle: however worthy the end might be, Congress had no power to pursue it since the people, through the Constitution, had given Congress no such power. In 1887, exactly 100 years after the Constitution was drafted, President Grover Cleveland made a similar point when he vetoed a bill to buy seeds for Texas farmers suffering from a drought, saying he could ‘find no warrant for such an appropriation in the Constitution.’[142] 

 

Cleveland also argued that passage of the Seed Corn Relief Bill would result in “the expectation of paternal care on the part of the government and weaken the sturdiness of our national character.”[143] Today it is hard to even imagine a policymaker making such a statement as Madison or Cleveland, but it demonstrates the dramatic political shift that has taken place since even the end of the nineteenth century.

 

The Gilded Age transformation of the United States from an agrarian to industrial nation by the twentieth century gave rise to a powerful political force that would transform constitutional government. As Matthew Spalding wrote:

 

The unleashing of the industrial revolution, the expansion of urban society, and the development of the United States as a modern world power — not to mention the large-scale challenges and opportunities that resulted from these changes — led to widespread calls for rethinking and reform in virtually every aspect of American life. The intellectual and programmatic response to this overwhelming sense of change was called progressivism, and the period between 1890 and 1920 is generally called the Progressive Era.[144]

 

When Theodore Roosevelt assumed the presidency after the assassination of President William McKinley, the Progressive Movement had Roosevelt as their leader who would use the power of the presidency to push through progressive reforms.

 

President Roosevelt, during the early twentieth century, promised the American people a Square Deal, which was a guarantee that everyone deserves a fair chance and the federal government would help regulate the economy and push for social reforms. Roosevelt saw himself as the steward of the American people and as President it was his responsibility to act on behalf of the peoples’ interest. As President, Roosevelt strengthened the powers of the Interstate Commerce Commission, went after big business, and pushed for other progressive reforms. Support for progressive measures grew not only in Washington, but also from some of the states and interest groups:

 

Support for these programs, and for intergovernmental cooperation, came not only from the public, but increasingly from interest groups that hoped to benefit from large new expenditures or involvement by the national government. It was around the turn of the century that large-scale national interest-groups first formed permanent organizations. These interests were joined by rapidly professionalizing federal and state bureaucracies that also saw advantages to more intergovernmental involvement.[145]

 

While Roosevelt was using broad executive presidential powers to push for progressive reforms, the centralization of government was helped by the passage of two new amendments to the Constitution. The Progressive Era constitutional amendments, just as with the Civil War Amendments, changed federalism. The 16th Amendment, which instituted a progressive income tax, and the 17th Amendment, which required the direct election of United States Senators by the people instead of state Legislatures, resulted in substantial constitutional changes. The other constitutional amendments that were passed during the Progressive Era included the 18th Amendment, prohibition of alcohol, and the 19th Amendment granting women the right to vote. 

 

During the Civil War the nation saw the first income tax to help support the Union war effort, but during the Gilded Age the Supreme Court had struck the income tax down as being unconstitutional. Progressives and agrarian populists during the late nineteenth and early twentieth centuries had pushed for a progressive income tax. The goal was achieved with the passage of the 16th Amendment in 1913. At first most Americans did not pay the income tax, but it soon provided a means for more revenue to pay for federal programs. “The power to levy an income tax put vast new financial resources at the disposal of the federal government, without which the expansion of federal programs into areas traditionally reserved to the states would have been impossible.”[146]  Since the passage of the 16th Amendment the political battle over taxes has remained front and center with conservatives arguing for lower rates and progressives pushing for higher rates to redistribute the wealth.

 

The 17th Amendment, also adopted in 1913, resulted in a more dramatic change in federalism. The progressive goal of the direct election of Senators by the people was in response to their belief that Congress had failed as an institution and was beholden to special interests. During the Gilded Age, progressives referred to Congress, especially the Senate, as the “millionaires club,” because they believed that Congress was bought by the big trusts. In addition “progressives claimed that direct election would strike a blow at the corporations and political machines that corrupted and dominated the state legislatures.”[147] Matthew Spalding argues that the passage of the 17th Amendment was “a devastating defeat for federalism.”[148]

 

It is important to remember that the Framers in drafting the Constitution came to a compromise over the issue of representation by having the House of Representatives elected directly by the people and the Senate elected by state Legislatures. The purpose of the Senate was not only to be a “cooling-off” chamber against the passions and factions in the House, but it would provide equal representation to small states and serve an important function by allowing states to have a voice in national policy. The 17th Amendment changed this equation because now Senators do not respond to the state Legislature, but rather to the people. Gregory F. Zoeller, who serves as Attorney General for the state of Indiana, describes the Founders intent:

 

First, and most importantly, it made the federal government more accountable to state governments. State legislatures originally selected Senators to serve as the state’s agents in the federal government, and act on the state’s behalf. These agents performed the necessary check on the House of Representatives by ensuring that the federal government did not pass legislation that would impose onerous burdens on the states. Further, because only the Senate can ratify treaties and confirm judicial and executive appointees, the original system gave the states a voice in these important national issues. Second, the original method of selecting Senators established true bicameralism in the federal government…The House of Representatives represented the people, while the Senate represented the states. The best way to ensure that the federal legislature did not pass legislation that benefited special interests was to divide the legislature into different branches, with members that were selected using different systems, and delegated different functions.[149]

 

Paul Moreno, a Constitutional historian, stated that the 17th Amendment “presented a fundamental alteration to the structure of the Constitution.”[150] “Perhaps what made the Seventeenth Amendment a ‘progressive’ measure was its weakening of constitutional limitations, which stood in the way of democratic, monarchial, oligarchial, or technocratic power alike,” stated Moreno.[151]

 

It will be difficult to return to the original method of electing Senators by state legislatures. Attorney General Zoeller described this process as well as a unique additional option for his state of Indiana in repealing the 17th Amendment:

 

Indiana could repeal the Seventeenth Amendment either by ratifying an amendment passed by both houses of Congress that repeals the Seventeenth Amendment or by calling a constitutional convention and instruct their states’ delegations to pass an amendment repealing the Seventeenth Amendment; or Indiana could pass a law that allows the state legislature to select the two candidates who will represent their parties in the general election. Although each method would achieve a similar result, if Indiana wishes to act on its own…passing its own law is the most efficient option as the Article V amendment process requires action in other states as well as Indiana.[152]

 

The Progressive Movement also harmed traditional constitutional limited government by its political philosophy. President Theodore Roosevelt and President Woodrow Wilson believed in the progressive notion that the Constitution was an outdated document and that limited government could not handle the problems of a modern, advanced, technological nation as the United States became in the 20th century. Both Roosevelt and Wilson believed in the administrative state, which was a progressive view that through government regulation and public administration, apolitical bureaucrats would work for the common good. Since progressives viewed Congress and the state legislatures as prone to corruption and preventing the passage of progressive legislation, the President (using the Bully Pulpit as Roosevelt said) and the administrative state would be able to regulate the economy and promote justice. As Matthew Spalding states:

 

In this new conception of the state, government is unlimited, subject only to the perceived wants of the popular will, under the forward looking guidance of progressive leadership. Its form is administrative and bureaucratic, run more and more by government experts and bureaucrats not subject to popular consent. The objective of this new theory is to turn government into a dynamic, evolving rational state, constantly changing and growing to achieve more Progress.[153]

 

The progressives saw the centralization of government as a good sign, and many even looked to Europe and socialist Russia as examples. Wilson, who was a political scientist and a reform-minded Governor of New Jersey before being elected President, argued that the Constitution was a “living” document that can change with the times. In other words the Constitution was not static and fixed, but it was subject to the laws of evolutionary Darwinism. A Constitution that limited government power was contradictory to the progressive philosophy of a powerful central government and expanding “rights” provided by the federal government.

 

   

 

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