The Court and the Economy, More Important than Most Think

By | June 30, 2018

Kevin Judge | June 30, 2018

It’s the Economy stupid!“, political guru James Carville once advised us.  We might do well not to forget that as the political world and nation comes to grips with the reality of a Supreme Court vacancy.  The replacement for retiring Supreme Court Justice Anthony Kennedy will have a chance to shape the destiny of the court and impact the nation for a generation in many different ways.

Most of the talk has been about how a new Justice, likely to be more conservative than Kennedy, will impact hot button social issues.  While the current court is general considered conservative, Kennedy often sided with the liberal wing on cases of great social import. He can be thanked, or blamed, for making gay marriage the law of the land, protecting abortion rights and protecting the right to burn the flag.

Less obvious than decisions that deal directly with social issues, like Roe v. Wade on abortion or Lawrence v. Texas on grmineay rights, the courts decisions have made possible the regulatory state that has grown massively since the New Deal. The Founding Fathers, I suspect would be appalled that the Commerce Clause of the Constitution has been construed to authorize the national government to manage everything in your life from what car you can drive to what toilet you can use, from the health care you get to the oil you heat your home with. From matters of great significance to minutia, we are all governed by regulations written and published by unelected bureaucrats that have the force of law without the approval of Congress or a Presidential signature.

To govern commerce is to govern, indeed.

Until the 1930’s, the Commerce Clause was used primarily to prevent states from restricting trade with their neighboring states. The founders who wrote the Commerce Clause did not envision a national and international economy based on consumerism. This new economy opened the door to the courts ratifying a massive regulatory state based largely on the powers granted the Feds by the Commerce Clause.

The Constitution created a national government with limited powers. The limitation of those powers was so important that the 10th Amendment of the Bill of Rights states that the government only has powers “enumerated”, specified by the Constitution. The 10th Amendment has been criticized as a redundancy, a truism. Obviously, you have the powers defined and do not have powers not defined. Duhh!

Well, it is not so obvious today. To many the 10th Amendment is a vestigial organ with no meaning in today’s world. When Nancy Pelosi was asked where the Constitution gave the Congress the right to restructure the nation’s health care system she literally could not comprehend the question. They are the Congress! Isn’t that enough?

While he certainly earned the label of the “swing vote” in a closely divided court, most of the time he sided with the four solidly conservative Justices. Many 5-4 decisions during his tenure have put somewhat of a break on the court’s post World War II trend to push the nation towards liberal solutions for problems the Congress and President have failed to address.

The court is not supposed to be political but has been a political battle ground since the New Deal. Ironically, attempts to make the court less political by focusing on the original intent of the Constitution are interpreted by liberals in politics and the media as conservative politics.  A significant difference in how Americans view the world is that conservatives tend to believe that there are areas of an individual’s life that are outside of the scope of politics and public policy. Liberals have no such limitation. As they say, the personal is political.

Liberals should not be afraid that an invigorated conservative majority on the court will return the country to the laisse fair economics of the 18th and 19th century. The world has changed way too much for that to happen. However, they can expect to have to accept future decisions that will define limits to the power of the regulatory state and be more favorable to corporations and high-income tax payers than they would like.

We know this to be true because, thanks to Justice Kennedy himself corporations have won significant decisions to avoid being limited in their rights to free speech and religion. Beyond high profile, hot button cases, we can also expect that the court will block efforts to roll back the Trump’s deregulation efforts which many credit to boosting the economy. It is hard to quantify, but government regulations not only add costs to business, but discourage some business initiatives entirely. Under Obama, business startups were the “dogs that didn’t bark. It is not just a coincidence that as business startups have surged under Trump, the unemployment rate has plummeted and the labor participation rate has surged.

People prioritize the importance of social vs. economic concerns differently, but there is an overlap. As Ronald Reagan used to say, “the best social program is a job!”

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