Trade Barriers Between States
| Author | F. Eugene Melder |
| DOI | 10.1177/000271624020700108 |
| Published date | 01 January 1940 |
| Date | 01 January 1940 |
| Subject Matter | Articles |
54
Trade
Barriers
Between
States
By
F.
EUGENE
MELDER
TRADITIOl~TALLY,
the
United
States
is
an
area
in
which
internal
free
trade
exists
as
long
as
the
trade
is
not
detrimental
to
the
public
safety
and
morals.
This
tradition
is
based
on
the
Constitution’s
limitations
on
the
ac-
tivities
of
the
states,
which
forbid
a
state
to
&dquo;...
lay
any
Imposts
or
Duties
on
Imports
or
Exports,
except
what
may
be
absolutely
necessary
for
executing
it’s
Inspection
Laws ...&dquo;
or
to
&dquo;...
lay
any
Duty
of
Tonnage ...
,&dquo;
without
the
consent
of
Congress.
Furthermore,
the
Constitution
forbids
discriminations
against
commerce,
ships,
and
citizens
of
other
states.
Nevertheless,
a
considerable
variety
of
state
and
local
statutes
and
regula-
tions
have
been
enacted
or
practiced
which
accomplish
results
similar
to
those
served
by
tariffs
in
the
relations
between
nations.
Like
international
tariffs,
these
laws
have
tended
to
accomplish
any
of
three
ends:
first,
to
provide
a
protected
market
for
home
producers
and
mer-
chants
by
discouraging
the
consumption
of
&dquo;imported
goods&dquo;;
second,
to
retaliate
against
governments
which
have
pro-
tected
their
own
producers;
and
third,
to
raise
public
revenues
at
the
expense
of
those
who
produce,
market,
or
con-
sume
&dquo;imported&dquo;
products
or
services.
The
principal
forms
of
state
and
local
trade
barriers
which
have
received
court
sanction
are
classified
as
&dquo;indirect
bur-
dens&dquo;
on
interstate
commerce.
These
laws
are
based
on
the
states’
rights
or
powers
to
tax
and
license
those
enjoying
property
or
other
privileges
or
rights
in
the
state,
and
the
states’
police
and
gen-
eral
regulatory
powers,
which
include
sanitary
protection
of
the
health
and
goods
of
persons
resident
in
the
state,
including
the
power
to
impose
quaran-
tine,
and
which
provide
for
the
safety
of
the
persons,
the
property,
and
the
morals
of
populations.
Other
types
of
laws
which
tend
to
clog
the
arteries
of
trade
and
which
are
sanctioned
by
the
courts
are
based
on
the
sovereign
pro-
prietary
powers
of
states
or
on
specific
grants
of
authority
to
the
states
by
Con-
gress
or
constitutional
amendment.
The
proprietary
or
corporate
powers
relate
to
the
conservation
of
natural
resources
and
ownership
of
public
works
and
prop-
erty.
Although
the
Constitution
forbids
the
states,
without
the
consent
of
Congress,
to
levy
duties
on
imports
and
exports,
and
prohibits
discriminations
against
commerce,
ships,
and
citizens
of
other
states,
the
revenue
powers
of
the
states
have
often
been
used
so
as
to
discrim-
inate
against
outside
goods,
persons,
and
corporations.’
EXERCISE
OF
TAX
AND
LICENSE
POWERS
The
leading
types
of
discriminations
based
on
the
tax
and
license
powers
of
the
states,
which
may
be
delegated
to
lo-
cal
governments,
are
as
follows:
1.
Special
taxes
on
certain
commodi-
ties
which
compete
with
products
made
within
the
state.
Thus
today
we
have
the
spectacle
of
thirty
states
attempting
to
limit
the
sale
of
margarine
within
their
borders
in
order
to
protect
various
of
their
home
producers.
Of
these,
nine
states
apply
their
&dquo;protective
tariffs&dquo;
to
all
margarine,
in
order
to
protect
but-
ter
producers.
Fifteen
states
protect
producers
of
cottonseed
oil
or
other
do-
mestic
fats
and
oils
against
the
competi-
tive
menace
of
coconut
and
other
im-
ported
oils
in
their
state
markets,
by
excise
taxes
on
the
sale
of
margarine
1
F.
Eugene
Melder,
"Trade
Barriers
and
States
Rights,"
American
Bar
Association
Jour-
nal,
Vol.
XXV,
No. 4
(April
1939),
pp.
307-9.
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