Effects on Commerce

• Author: Kenneth L. Karst
• Pages: 861-862

Page 861

"At the beginning Chief Justice [ JOHN ] MARSHALL described the federal commerce power with a breadth never yet exceeded." So said Justice ROBERT H. JACKSON for a unanimous Supreme Court in WICKARD V. FILBURN (1946), in the course of an opinion recognizing the broad sweep of Congress's modern power to regulate the national economy under the COMMERCE CLAUSE. Marshall's opinion in GIBBONS V. OGDEN (1824) read that clause's reference to commerce "among the several States" to mean "that commerce which concerns more States than one."

For the Constitution's first century, however, Congress did little to regulate INTERSTATE COMMERCE. The first major national regulatory laws were the INTERSTATE COMMERCE ACT of 1887, regulating railroads, and the SHERMAN ANTI-TRUST ACT of 1890. It fell to another Supreme Court to define the scope of congressional power, and at first the Court's definition was narrow. In UNITED STATES V. E. C. KNIGHT CO. (1895) the Court interpreted the Sherman Act, which prohibited monopolizing "any part of the trade or commerce among the several States," to exclude from its coverage a monopoly of sugar refining. Manufacturing was not commerce, said the Court; that "commerce might be indirectly affected" by a manufacturing combination producing ninety-eight percent of the nation's refined sugar was insufficient to bring the combination under the act's terms.

"Direct" effects on commerce, however, were found in a series of Sherman Act cases culminating in SWIFT & CO. V. UNITED STATES (1905). (See also STAFFORD V. WALLACE.) Yet the Court persisted in its assertion that manufacturing was not commerce, even to the extent of holding in HAMMER V. DAGENHART (1918) that a congressional regulation of the interstate transportation of goods made by child labor was invalid because its purpose was to regulate manufacturing.

Page 862

Meanwhile, the Court was developing quite another view of congressional power to regulate railroads. In Houston, East and West Texas Railway Co. v. United States, the "Shreveport case" (1914), the Court upheld an Interstate Commerce Commission order requiring a railroad to equalize certain interstate and intrastate rates. Such railroads were "common instrumentalities" of interstate and local commerce; the ICC was regulating only the relation between local and interstate rates. Taken seriously, the SHREVEPORT DOCTRINE implies congressional power to regulate intrastate activity because of...