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Capitalism and Conflict
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Capitalism and Conflict
by Jeffrey Rosen

After the Civil War, the Fourteenth Amendment to the Constitution, ratified in 1868, promised equal rights for African Americans by declaring that states could not deny to "any person" the equal protection of the law. When the first case dealing with the new amendment -- the so-called Slaughterhouse Cases, which ironically had nothing to do with civil rights but rather involved a state-created monopoly in the livestock and butchering industry in New Orleans -- reached the Court in 1873, however, a 5-4 majority held that the amendment's key protections did not apply to the states, and that states therefore had no obligation to respect the fundamental liberties of citizenship listed in the Bill of Rights. While the decision in Slaughterhouse did not explicitly deal with the civil rights of blacks, it set a precedent -- confirmed more tangibly in the Civil Rights Cases of 1883 -- that the Court would not interpret the Fourteenth Amendment to protect the civil rights of minorities from state infringement. Nevertheless, laissez faire economics -- the doctrine that economies work best when unregulated -- were ascendant, and the Court would soon employ the Fourteenth Amendment to strike down state laws that, in the views of the justices, unreasonably violated economic liberties. The Court's growing judicial activism in economic liberties cases in the progressive era set the stage for a confrontation between President Franklin D. Roosevelt and the Supreme Court that continues to be cited as a cautionary tale for judicial overreaching.

The idea that the Constitution protects economic liberties was hardly invented by the justices after the Civil War. On the contrary, from the Jacksonian era onward, state and federal judges believed that labor and capital could fend for themselves in a properly functioning market, and that therefore judges had an obligation to strike down what they called "class legislation," or economic regulations that favored one group of competitors at the expense of others. After the Civil War, the Supreme Court became increasingly activist in cases involving economic liberty, striking down 10 federal laws between 1902 and 1917. (Remember that the Court had struck down only two federal laws before the Civil War, in Marbury v. Madison [1803] and Dred Scott [1857].) During the progressive era, the Court provoked even more criticism for its willingness to strike down economic regulations passed by state legislatures, such as minimum wage and maximum hour laws.

'Freedom to differ is not limited to things that do not matter much. That would be a mere shadow of freedom. The test of its substance is the right to differ as to things that touch the heart of the existing order.' -- Robert H. Jackson

The justices were not indiscriminately activist in these cases; instead, they vacillated between upholding some state and federal regulations and striking others down. These decisions were guided by an effort to apply old legal categories that allowed the regulation of businesses "affected with the public interest" in the interest of promoting health, safety, and morals, while disallowing the regulation of purely private enterprises. So, for example, the Court in the late 19th and early 20th century supported the power of states to compel vaccinations and to regulate grain elevators and mines. But during the progressive era, it was vilified for its conservative judicial activism, largely because of its performance in one of the most famous regulatory cases in history, Lochner v. New York (1905).

A scene from the bakery of Joseph Lochner.
A scene from the bakery of Joseph Lochner, who in 1902 challenged a New York state law prohibiting the employment of bakers for more than 60 hours a week or 10 hours a day.

Reproduction courtesy of NATIONAL GEOGRAPHIC