"With all these blessings, what more is necessary to make us a happy and prosperous people? Still one thing more, fellow citizens - a wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from one mouth of labor the bread it has earned. This is the sum of good government." Thomas Jefferson, First Inaugural Address.

Under our system of government, there can be no action by Congress constitutionally beyond the delegated and implied powers of that body, and conversely there can be no exercise of their police powers by the states which usurps federal authority in any field constitutionally occupied by that authority. It is obvious then, that nationwide and regional commercial, industrial and social reforms could not be completely effected without a juncture of power and a combination of all agencies, federal and state, devoted to a common purpose. A fusion of all power as a means to this end, therefore, became imperative to Franklin Delano Roosevelt.

The National Industrial Recovery Act was foredoomed to failure not only because of its apparent conflict with the Constitution, but because the authors of it conceived their plan in disregard of the position which the states must occupy in labor and industrial reforms. The legislation which the state legislatures in many instances enacted to supplement the NRA was fundamentally dishonest, because it amounted to a surrender to the United States of that measure of home rule which the people had declared in the Constitution should remain in the states. Footnote1

The National Labor Relations Act, commonly called the NLRA, was signed by President Roosevelt on July 5, 1935. Footnote2 It was not a completely new governmental experience in the field of labor relations. An attempt at large-scale regulation of all industry was made in the National Industrial Recovery Act with Section 7(a), but the Supreme Court held the Act unconstitutional for the double reason that it delegated legislative power to the President to declare what was fair competition and that it went beyond the power of Congress to regulate intrastate commerce. Footnote3 Two months after the downfall of the National Industrial Recovery Act, the National Labor Relations Act was passed, embodying in statute form Section 7(a). The Act was justified by its supporters on the basis that the denial by employers of the right of employees to organize and the refusal by employers to accept the procedure of collective bargaining led to strikes and other forms of industrial unrest burdensome to commerce. To many it seemed like a dangerous and radical experiment. Footnote4

The scheme of the National Labor Relations Act, may be briefly stated. The first section sets forth findings with respect to the injury to commerce resulting from the denial by employers of the right of employees to organize and from the refusal of employers to accept the procedure of collective bargaining. There follows a declaration that it is the policy of the United States to eliminate these causes of obstruction to the flow of commerce. This section is as follows:

Section 1. The denial by employers of the right of employees to organize and the refusal by employers to accept the procedure of collective bargaining lead to strikes and other forms of industrial strife or unrest, which have the intent or the necessary effect of burdening or obstructing commerce by (a) impairing the efficiency, safety, or operation of the instrumentalities of commerce; (b) occurring in the current of commerce; (c) materially affecting, restraining, or controlling the flow of raw materials or manufactured or processed goods from or into the channels of commerce; or (d) causing diminution of employment and wages in such volume as substantially to impair or disrupt the market for goods flowing from or into the channels of commerce.

The inequality of bargaining power between employees who do not possess full freedom of association or actual liberty of contract, and employers who are organized in the corporate or other forms of ownership association substantially burdens and affects the flow of commerce, and tends to aggravate recurrent business depressions, by depressing wage rates and the purchasing power of wage earners in industry and by preventing the stabilization of competitive wage rates and working conditions within and between industries.

Experience has proved that protection by law of the right of employees to organize and bargain collectively safeguards commerce from injury, impairment, or interruption, and promotes the flow of commerce by removing certain recognized sources of industrial strife and unrest, by encouraging practices fundamental to the friendly adjustment of industrial disputes arising out of differences as to wages, hours, or other working conditions, and by restoring equality of bargaining power between employers and employees.

It is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.

The Act then defines the terms it uses, including the terms "commerce" and "effecting commerce." It creates the National Labor Relations Board (referred to as the "Board") and prescribes its organization. It sets forth the right of employees to self-organization and to bargain collectively through representatives of their own choosing. It defines "unfair labor practices." It lays down rules as to the representation of employees for the purpose of collective bargaining. The Board is empowered to prevent the described unfair labor practices affecting commerce and the Act prescribes the procedure to that end. The Board is authorized to petition designated courts to secure the enforcement of its orders. The findings of the Board as to the facts, if supported by evidence, are to be conclusive. If either party on application to the court shows that additional evidence is material and that there were reasonable grounds for the failure to introduce such evidence in the hearings before the Board, the court may order the additional evidence to be taken. Any person aggrieved by a final order of the Board may obtain a review in the designated courts with the same procedure as in the case of an application by the Board for the enforcement of its order. The Board has broad powers of investigation. Interference with members of the Board or its agents in the performance of their duties is punishable by fine and imprisonment. Nothing in the Act is to be construed to interfere with the right to strike. There is a separability clause to the effect that if any provision of the Act or its application to any person or circumstances shall be held invalid, the remainder of the Act or its application to other persons or circumstances shall not be affected.

The jurisdiction of the board is limited to businesses in which labor disturbances will constitute a burden on interstate or foreign commerce. The Act did not confer on the federal government any general authority over all business.

Under our government of delegated and reserved powers, Congress has only such powers as are specifically granted to it by the Constitution. Among these is the power to regulate interstate commerce. Footnote5 This power has been interpreted to have a very broad meaning, to include not only actual traffic between the states, but police regulations in regard to such traffic; the control of intrastate commerce when necessary for the effective control of interstate commerce; Footnote6 and regulation of activities which, though not of themselves commerce and though local in nature, are yet in the so-called "current" of interstate commerce, and thus affect it. Footnote7 Under another line of cases, the Anti-Trust cases, combinations in restraint of interstate commerce have been held illegal, and this rule applied directly to combinations of labor. Footnote8 It was established, however, that intrastate matters, including combinations in restraint of trade, could only be regulated where they affect interstate commerce and in a real and substantial way, and not where there is only a remote or indirect relation.

The National Labor Relations Act of 1935 was based on the theory that the denial by employers of the right of employees to organize and bargain collectively causes strikes and other industrial disorders, which obstruct and burden interstate commerce. It was argued by the proponents of the NLRA that labor difficulties had a direct and substantial relation to interstate commerce; that, if labor disorders are enjoinable as in restraint of trade, the conditions which breed them are also subject to regulation under the power to regulate. This argument was supported by the rule that Congress has power not only to restrict but also to promote and protect interstate commerce. Footnote9 It was urged by the proponents of the Act, that labor disturbances were a national problem and could not be dealt with effectively by the states separately. It had been held by the Supreme Court in the First Coronado case, Footnote10 though by way of dictum, that, "if Congress deems certain recurring practices, though not really part of interstate commerce, likely to obstruct, restrain or burden it, it has the power to subject them to national supervision and restraint."

Now let's consider the arguments advanced by the opponents in 1935 against the constitutionality of the National Labor Relations Act under the commerce clause. In the first place, in 1935 it was established by previous court decisions that manufacturing and production was not interstate commerce and could not be regulated as such, even though it was intended by the act that the goods produced would later enter the "stream" of interstate commerce. Footnote11 As to the effect of labor disturbances on interstate commerce, it was pointed out by these opponents that, though secondary boycotts have frequently been held in restraint of trade, Footnote12 in these cases the acts of the parties have not been confined to any one state, and have directly affected goods already in the "stream" of interstate commerce. Strikes, however, have generally been held not to be in constraint of trade when the strike was confined within a single state and resulted only in curtailing production. It has been distinctly held that such curtailment of production is of only an incidental and remote relation to interstate trade. Since a large part of the labor difficulties are strikes of this nature, the National Labor Relations Act as applied to them would be invalid; at the most it could not have the wide scope intended. Also, if such strikes are themselves not the substantial relation to interstate trade, then the employer-employee relations underlying them would have a less direct relation to interstate commerce, and are thus not subject to regulation by Congress.

In the Schechter case Footnote13 overthrowing the National Industrial Recovery Act, the Supreme Court reaffirmed the principle that Congress may only regulate transactions which have a close and direct relation to interstate commerce, Footnote14 and the Court also took the view that regulation of local business was not a valid exercise of the commerce power. Footnote15 Though the Court did leave itself a loophole for future decisions when it said that the distinction between direct and indirect effect can "only be drawn as individual cases arise," Footnote16 it would seem, since that case involved the regulation of wages and hours of labor, that the same rule would apply to regulation of other aspects of the employer-employee relation, so far as the power under the commerce clause is concerned.

It was also argued that to extend the commerce clause to include the regulation of local business and industry would be to remove its meaning as a specific grant of power, whereby destroying the very principle of delegated and reserved powers, and would result in a centralized government. On this point it was said in the Schechter case:

"If the commerce clause were construed to reach all enterprises and transactions which could be said to have an indirect effect upon interstate commerce, the federal authority would embrace practically all the activities of the people, and the authority of the state over its domestic concerns would exist only by sufferance of the federal government." Footnote17

When the NLRA cases came before the Court in 1937, it seemed extremely doubtful that the Supreme Court would hold the National Labor Relations Act to be a valid exercise of the power of Congress to regulate all interstate activities,.

But, assuming that the National Labor Relations Act was declared valid under the commerce clause, would it be constitutional under the due-process clause of the Fifth Amendment, which has been interpreted to guarantee the right to freedom of contract? Footnote18 Would the NLRA subject the individual employee to the collective bargaining agreement obtained by the union representative? Or would the individual employee be free to contract for his own labor? Does the NLRA eliminate the limitations on the Federal Government in the exercise of their powers granted to it by the Constitution? Footnote19

In Adair v. United States Footnote20 the Erdman Act of 1898 was directly held by the Supreme Court to be invalid because it interfered with the right of the employer and employee to contract. The Court said:

"it is not within the function of the government to compel any person against his will to accept or retain the personal services of another, or to compel any person against his will to perform personal services for another." Footnote21

This holding was followed in Coppage v. Kansas, Footnote22 in which a similar state statute was declared unconstitutional, the Court holding that:

"Conceding the full right of the individual to join the union, he has no inherent right to do this and still remain in the employ of one who is unwilling to employ a union man." Footnote23

In support of the National Labor Relations Act it was urged that since the Adair case Footnote24 in 1907 economic and social conditions had changed by the 1930's, so that such regulations were now reasonable limitations on the employer and employee's freedom of contract; that, once it is admitted that freedom of contract is subject to some restrictions, the extent to which the state may go becomes a mere matter of degree. The Supreme Court has recognized the necessity for labor unions "to give laborers an opportunity to deal on an equality with their employers" It is also true that the Court in McLean v. Arkansas Footnote25 following the dissent of Justice Holmes in Adair Footnote26 held that the legislature is primarily the judge of the necessity of such enactment's, and that the Court will not interfere unless the act is unmistakably and palpably in excess of legislative power. In view of these considerations it was hoped by the Roosevelt administration that the Supreme Court would overrule Adair v. U.S., but they feared that with the attitude of the Supreme Court in 1937, it was highly improbable that it would sustain the National Labor Relations Act on the point of due process and freedom of contract.

Another objection against the National Labor Relations Act was that it was one-sided, in that no provision was made for employers to complain to the Board of unfair labor practices by labor unions, and also in that, though it was unfair for employers to refuse to bargain collectively, yet labor was under no such obligation, since it was expressly provided that the right to strike be not impaired.

Aside from these objections, it was agreed by both sides that the validity of the NLRA rested largely upon the interpretation of two flexible doctrines; first, that in order for an activity to come within the commerce power, it must have a direct and substantial relation to interstate commerce; and second, that the liberty to contract is subject only to reasonable limitations. It was hoped by the Administration that the Supreme Court would extend these doctrines to uphold the Act, since there surely were some regulations which could be placed upon the employer-employee relationship which would have the effect of promoting industrial peace. But, considering the particular provisions of the act in the light of past decisions of the Court, Roosevelt lacked confidence that the Supreme Court would uphold the constitutionality of the National Labor Relations Act.

On February 12, 1937, sixty days before the Supreme Court decided the National Labor Relations Act cases, the Circuit Court of Appeals for the First Circuit handed down its decision in Mayers v. Bethlehem Shipbuilding Corporation. Footnote27 In this case the Shipbuilding Corporation and a company union, which was prohibited by the NLRA, had secured an injunction against the National Labor Relations Board, to prevent the board from proceeding with complaints of unfair labor practices. The Circuit Court of Appeals, reviewing the litigation on this subject, said:

"The case is by no means of the first impression. Cases involving the powers and jurisdiction of the National Labor Relations Board have already arisen and been decided in the second, fourth, fifth, sixth, eighth, and ninth circuits, some as in this case on proceedings to enjoin hearings, some on petitions by the board for enforcement of its orders. Where the question was presented it has uniformly been held that the act does not apply to manufacturers. Such persons are not engaged in interstate commerce and their relations with their employees are within the jurisdiction of the state rather than the national government." Footnote28

The court continued:

"On the present state of the law there would seem to be only slight probability that any order which might be made by the board in this case would be enforced." Footnote29

The court was also of the opinion that the fact that the respondent obtained much of its raw material from outside the state in which it was located and sent its finished products out of the state had not the effect of making the business a part of interstate commerce.

In National Labor Relations Board v. Jones & Laughlin Steel Corporation, decided by the Circuit Court of Appeals for the Fifth Circuit on June 15, 1936, the court said:

"The National Labor Relations Board has petitioned us to enforce an order made by it, which required Jones & Laughlin Steel Corporation, organized under the laws of Pennsylvania, to reinstate certain discharged employees in its steel plant in Aliquippa, Pennsylvania and to do other things in the connection.

"The petition must be denied because, under the facts found by the board and shown as evidence, the board has no jurisdiction over a labor dispute between employer and employees touching the discharge of laborers in a steel plant, who were engaged only in manufacture. The Constitution does not vest in the federal government the power to regulate the relation as such of employer and employee in production or manufacture."

The appeals court then quoted from the case of Carter v. Carter Coal Company, decided by the Supreme Court on May 18, 1936, less than a year before the time the Court rendered the National Labor Relations Act decisions. This quotation reads:

"One who produces or manufactures a commodity, subsequently sold and shipped by him in interstate commerce, whether such sale or shipment were originally intended or not, has engaged in two and separate activities. So far as he produces or manufactures a commodity, his business is purely local. So far as he sells and ships, or contracts to sell and ship, the commodity to customers in another state, he engages in interstate commerce. In respect to the former, he is subject only to regulation by the state; in respect to the latter, to regulation only by the federal government. Production is not commerce; but a step in preparation for commerce. Chassaniol v. Greenwood, 291 U.S. 584.

"We have seen that the word 'commerce' is the equivalent of the phrase 'intercourse for the purpose of trade.' Plainly the incidents leading up to and culminating in the mining of coal do not constitute such intercourse. The employment of men, the fixing of their wages, hours of labor, and working conditions, the bargaining in respect of these things, whether carried on separately or collectively-each and all constitute intercourse for the purpose of production, not of trade. The latter is a thing apart from the relation of employer and employee, which in all producing operations is purely local in character. Extraction of coal from the mine is the aim and the completed result of local activities. Commerce in the coal mined is not brought into being by force of these activities, but by negotiations, agreements, and circumstances entirely apart from production. Mining brings the subject matter of commerce into existence. Commerce disposes of it."

The Circuit Court of Appeals then applied this reasoning to the facts of the Jones & Laughlin case. The underlying thought was clear. The Supreme Court had limited the power of the national government to interstate transportation. Nothing can be transported until after mining or manufacture. Production of an article is preparatory to transportation - hence it is local in its nature and beyond the power of the federal government to regulate.

So it was in the other court of appeals. In the case of National Labor Relations Board v. Friedman-Harry Marks Clothing Company, Footnote30 decided July 13, 1936, in the Second Circuit, the court said:

"The relations between the employer and its employees in this manufacturing industry were merely incidents of production. In its manufacturing, respondent was in no way engaged in interstate commerce, nor did its labor practices so directly affect interstate commerce as to come within the federal commerce power. Carter v. Carter Coal Co. 56 S.Ct. 855, 80 L.Ed. 1160 (1936); Schechter Poultry Corporation v. United States, 295 U.S. 495, 55 S.Ct. 837, 79 L.Ed. 1570, 97 A.L.R. 947. No authority warrants the conclusion that the powers of the federal government permit the regulation of the dealings between employers or employees when engaged in the purely local business of manufacture." Footnote31

In Schechter Poultry Corp. v. United States, relied upon by the Court of Appeals, it was held that the sale of poultry in New York was not interstate commerce, although 96 per cent of it came from other states, and the sale of sick chickens in violation of the Code had so demoralized the market as to cut importation 20 per cent. Chief Justice Hughes, speaking for the Supreme Court, said in the Schechter opinion:

"Were these transaction 'in' interstate commerce? Much is made of the fact that almost all the poultry coming to New York is sent there from other States. But the code provisions as here applied do not concern the transportation of the poultry from other States to New York, or the transactions of the commission men or others to whom it is consigned, or the sales made by such consignees to defendants. When the defendants had made their purchases, whether at the West Washington Market in New York City or at the railroad terminals serving the City, or elsewhere, the poultry was trucked to their slaughterhouse in Brooklyn for local disposition. The interstate transactions in relation to that poultry then ended. Defendants held the poultry at their slaughterhouse markets for slaughter and local sale to retail dealers and butchers, who in turn sold directly to consumers.

"The undisputed facts thus afford no warrant for the argument that the poultry handled by the defendants at their slaughterhouse markets was in the 'current' or 'flow' of interstate commerce and was thus subject to congressional regulation. The mere fact that there may be a constant flow of commodities into a State does not mean that the flow continues after the property has arrived and has become commingled with the mass of property within the State and is there solely for local disposition and use. So far as the poultry herein questioned is concerned, the flow in interstate commerce had ceased. The poultry has come to a permanent rest within the State. It was not held, used or sold by the defendants in relation to any further transaction in interstate commerce and was not destined for transportation to other states. Hence, decisions which deal with a stream of interstate commerce - where goods come to rest within a state temporarily and are later to go forward in interstate commerce - and with the regulation of transactions involved in that practical continuity of movement, are not applicable here.

"Did the defendant's transactions directly 'affect' interstate commerce so as to be subject to federal regulation? In determining how far the federal government may go in controlling intrastate transactions upon the ground that they 'affect' interstate commerce, there is a necessary and well-established distinction between direct and indirect effects. Direct effects are illustrated by the railroad cases we have cited, as e.g., the effect of failure to use prescribed safety appliances on railroads which are the highway of both interstate and intrastate commerce, But where the effect of intrastate transportation upon interstate commerce is merely indirect, such transactions remain within the domain of state power. If the commerce clause were construed to reach all enterprises and transactions which could be said to have an indirect effect upon interstate commerce, the federal authority would embrace practically all the activities of the people and the authority of the State over its domestic concerns would exist only by sufferance of the federal government." Footnote32

On April 12, 1937 the Supreme Court handed down five decisions Footnote33 upholding the National Labor Relations Act. These cases involved several constitutional questions. Most important of these were, first, the constitutionality of the Act per se, and, second, the limits of its constitutional application.

The opinions in three cases were delivered by Chief Justice Hughes in National Labor Relations Board v. Jones & Laughlin Steel Corporation. In two of the cases, Mr. Justice Roberts delivered the opinion of the Court. In all of the cases, except Washington, Virginia and Maryland Coach Company v. National Labor Relations Board, Mr. Justice Van Devanter, Mr. Justice McReynolds, Mr. Justice Sutherland and Mr. Justice Butler dissented.

In NLRB v. Jones & Laughlin Steel Corporation, the proceeding was instituted before the National Labor Relations Board by the Beaver Valley Lodge No. 200, affiliated with the Amalgamated Association of Iron, Steel and Tin Workers of America, a labor organization, charging that the Steel Corporation had violated the Act in engaging in unfair labor practices affecting commerce. The unfair practices charged were that the Corporation discriminated against members of the Union with regard to hire and tenure of employment and was coercing and intimidating its employees in order to interfere with their self-organization by discharging certain employees. The Board sustained the charges, ordered the Corporation to cease and desist from the practices, to offer reinstatement to ten of the employees named, to make good their losses and to post for thirty days notices that the Corporation would not discharge or discriminate against union members. Upon the Corporation's failure to comply, the Board petitioned the Circuit Court of Appeals to enforce the order. The Court denied the petition on the ground that the order exceeded federal power. The case came before the Supreme Court by way of certiorari.

The order in question was made after complaint, notice and hearing. The Steel Corporation appeared specially, contesting the jurisdiction of the Board and setting up the constitutional invalidity of the statute. After hearing evidence the Board sustained the charges and issued the order complained of.

The Steel Corporation contended (1) that the Act was a regulation of labor relations and not of interstate commerce; (2) that the Act can have no application to respondent's relations with its production employees because they are not subject to federal regulation; and (3) that the provisions of the Act violated Section 2 of Article III and the Fifth and Seventh Amendments of the Federal Constitution.

In rejecting these contentions Chief Justice Hughes reviewed the findings of the Board as to the nature and scope of the Steel Corporation's business. Among others the Board found that the Corporation was the fourth largest producer of steel in the United States, which, with its 19 subsidiaries, was a completely integrated enterprise owning and operating ore, coal and limestone properties, lake and river transportation facilities and terminal and connecting railroads. The various properties were located in many states. It has sales offices in twenty cities in the United States and a wholly owned subsidiary, which is its distributor in Canada. Its iron and steel manufacturing plants were located in Pittsburgh and Aliquippa, Pennsylvania. About 75% of its product is shipped out of Pennsylvania. Summarizing the Corporation's operations, the Board stated that the works in Pittsburgh and Aliquippa:

"might be likened to the heart of a self-contained, highly integrated body. They draw in the raw materials from Michigan, Minnesota, West Virginia, Pennsylvania in part through arteries and by means controlled by the respondent; they transform the materials and then pump them to all parts of the nation through the vast mechanism which the respondent has elaborated." Footnote34

To carry out the activities of the Corporation 33,000 men mine ore, 44,000 mine coal, 4,000 quarry limestone, 16,000 manufacture coke, 343,000 manufacture steel, and 83,000 transport its products.

Evidence was also taken by the Board as to relations between the Corporation and its employees, and the Board found that the Corporation had discharged certain employees because of their union activity and for the purpose of discouraging membership in the union.

After a review of these findings the Supreme Court turned its attention to the questions of law raised. The first legal question considered related to the scope of the Act. It was raised in the respondent's contention that the Act attempts to regulate all industry and invades the reserved powers of the states over their local concerns; that the references in the Act to interstate commerce are colorable at best; that it was not a true regulation of commerce or matters directly affecting it, but is designed to place under compulsory federal supervision all industrial labor relations in the nation. The Court, however, was of the opinion that the Act may be construed so as to operate within the sphere of federal constitutional power. The jurisdictional provisions and their effect were described as follows:

"The jurisdiction conferred upon the Board, and invoked in this instance, is found in Section 10(a), which provides:

"Sec. 10(a). The Board is empowered, as hereinafter provided, to prevent any person from engaging in any unfair labor practice (listed in section 8) affecting commerce.

"The critical words of this provision, prescribing the limits of the Board's authority in dealing with the labor practices, are 'affecting commerce.' The Act specifically defines the 'commerce' to which it refers (sec. 2(6)):

"The term 'commerce' means trade, traffic, commerce, transportation, or communication among the several States, or between the District of Columbia or any Territory of the United States and any State or other Territory, or between any foreign country and any State, Territory, or the District of Columbia, or within the District of Columbia or any Territory, or between points in the same State but through any other State or any Territory or the District of Columbia or any foreign country.'

"There can be no question that the commerce thus contemplated by the Act (aside from that within a Territory or the District of Columbia) is interstate and foreign commerce in the constitutional sense. The Act also defines the term 'affecting commerce' (sec. 2(7)):

"The term 'affecting commerce' means in commerce, or burdening or obstructing commerce or the free flow of commerce, or having led or tending to lead to a labor dispute burdening or obstructing commerce or the free flow of commerce.

"This definition is one of exclusion as well as inclusion. The grant of authority to the Board does not purport to extend to the relationship between all industrial employees and employers. Its terms do not impose collective bargaining upon all industry regardless of effects upon interstate or foreign commerce. It purports to reach only what may be deemed to burden or obstruct that commerce and, thus qualified, it must be construed as contemplating the exercise of control within constitutional bounds. It is a familiar principle that acts which directly burden or obstruct interstate or foreign commerce, or its free flow, are within the reach of the congressional power. Acts having that effect are not rendered immune because they grow out of labor disputes. It is the effect upon commerce, not the source of the injury, which is the criterion. Whether or not particular action does affect commerce in such a close and intimate fashion as to be subject to federal control, and hence to lie within the authority conferred upon the Board, is left by the statute to be determined as individual cases arise. We are thus to inquire whether in the instant case the constitutional boundary has been passed." Footnote35

Next referred to were the unfair labor practices involved. In sustaining the definition of "unfair labor practices," the Court pointed out that the Act goes no further than to safeguard the right of employees to self-organization, and to select representatives of their own choosing for collective bargaining or other mutual protection without restraint or coercion. In upholding this right the Court cited similar provisions of the Railroad Labor Act which had been sustained and said:

"Thus, in its present application, the statute goes no further than to safeguard the right of employees to self-organization and to select representatives of their own choosing for collective bargaining or other mutual protection without restraint or coercion by their employer.

"That is a fundamental right. Employees have as clear right to organize and select their representatives for lawful purposes as the respondent has to organize its business and select its own officers and agents. Discrimination and coercion to prevent the free exercise of the right of employees to self-organization and representation is a proper subject for condemnation by competent legislative authority. Long ago we stated the reason for labor organizations. We said that they were organized out of the necessities of the situation; that a single employee was helpless in dealing with an employer; that he was dependent ordinarily on his daily wage for the maintenance of himself and family; that if the employer refused to pay him the wages that he thought fair; he was nevertheless unable to leave the employ and resist arbitrary and unfair treatment; that union was essential to give laborers opportunity to deal on an equality with their employer. We reiterated these views when we had under consideration the Railroad Labor Act of 1926. Fully recognizing the legality of collective action on the part of employees in order to safeguard their proper interests, we said that Congress was not required to ignore this right but could safeguard it. Congress could not seek to make appropriate collective action of employees an instrument of peace rather than of strife. We said that such collective action would be a mockery if representation were made futile by interference with freedom of choice. Hence the prohibition by Congress of interference with the selection of representatives for the purpose of negotiation and conference between employers and employees, 'instead of being an invasion of the constitutional right of either, was based on the recognition of the rights of both.' We have reasserted the same principle in sustaining the application of the Railroad Labor Act as amended in 1934." Footnote36

The third legal question considered was the crucial one whether the Act was valid as applied to employees engaged in production. The Steel Corporation argued that whatever may be the law as to employees engaged in interstate commerce, manufacturing in itself was not commerce and the relations between employees and employer therein were not subject to federal regulation. In support of this contention numerous decisions were cited including the Schechter case, and the Carter Coal case. But the government distinguished these cases urging that the activities constituted a "stream" of commerce of which industrial strife would cripple the entire flow. The government's contention in this regard was explained as follows in the opinion:

"The various parts of respondent's enterprise are described as interdependent and as thus involving 'a great movement of iron ore, coal and limestone along well-defined paths to the steel mills, thence through them, and thence in the form of steel products into the consuming centers of the country-a definite and well-understood course of business.' It is urged that these activities constitute a 'stream' or 'flow' of commerce, of which the Aliquippa manufacturing plant is the focal point, and that industrial strife at that point would cripple the entire movement. Reference is made to our decision sustaining the Packers and Stockyards Act. Stafford v. Wallace, 258 U.S. 495. The Court found that the stockyards were but a 'throat' through which the current of commerce flowed and the transactions which there occurred could not be separated from that movement. Hence the sales at the stockyards were not regarded as merely local transactions, for while they created 'a local change of title' they did not 'stop the flow,' but merely changed the private interests in the subject of the current. Distinguishing the cases which upheld the power of the State to impose a non-discriminatory tax upon property which the owner intended to transport to another State, but which was not in actual transit and was held within the State subject to the disposition of the owner, the Court remarked: "The question, it should be observed, is not with respect to the extent of the power of Congress to regulate interstate commerce, but whether a particular exercise of state power in view of its nature and operation must be deemed to be in conflict with this paramount authority.' Applying the doctrine of Stafford v. Wallace, the Court sustained the Grain Futures Act of 1922 with respect to transactions on the Chicago Board of Trade, although these transactions were 'not in and of themselves interstate commerce.' Congress had found that they had become 'a constantly recurring burden and obstruction to that commerce.'" Footnote37

The Steel Corporation pointed to various aspects of its business which it urged removed the Aliquippa plant from the flow of commerce and argued that if importation and exportation in interstate commerce did not singly remove local activities into the field of federal power, it should follow that their combination would not alter the situation. The Court found it unnecessary to determine whether the features urged dispose of the analogy to the "stream" of commerce cases and said:

"The instances in which that metaphor has been used are but particular, and not exclusive, illustrations of the protective power which the Government invokes in support of the present Act. The congressional authority to protect interstate commerce from burdens and obstructions is not limited to transactions which can be deemed to be an essential part of a 'flow' of interstate or foreign commerce. Burdens and obstructions may be due to injurious action springing from other sources. The fundamental principle is that the power to regulate commerce is the power to enact 'all appropriate legislation' for 'its protection and advancement'; to adopt measures 'to promote its growth and insure its safety; to foster, protect, control and restrain.' That power is plenary and may be exerted to protect interstate commerce 'no matter what the source of the dangers which threaten it.' Although activities may be intrastate in character when separately considered, if they have such a close and substantial relation to interstate commerce that their control is essential or appropriate to protect that commerce from burdens and obstructions, Congress cannot be denied the power to exercise that control. Undoubtedly the scope of this power must be considered in the light of our dual system of government and may not be extended so as to embrace effects upon interstate commerce so indirect and remote that to embrace them, in view of our complex society, would effectually obliterate the distinction between what is national and what is local and create a completely centralized government. The question is necessarily one of degree." Footnote38

The opinion by Chief Justice Hughes points out further that it is established that intrastate activities by reason of their proximity to interstate commerce may come within the range of federal power. A notable example of this may be found in intrastate railroad rates which are subject to federal regulation by reason of their relation to interstate rates and to prevent discrimination against interstate commerce. Further illustration was cited in the case sustaining the exercise of federal power under the Sherman Anti-Trust Act:

"The close and intimate effect which brings the subject within the reach of federal power may be due to activities in relation to productive industry although the industry when separately viewed is local. This has been abundantly illustrated in the application of the federal Anti-Trust Act.

"Upon the same principle, the Anti-Trust Act has been applied to the conduct of employees engaged in production. The decisions dealing with the question of that application illustrate both the principle and its limitation. Thus, in the first Coronado case, the Court held that mining was not interstate commerce, that the power of Congress did not extend to its regulation as such, and that it had not been shown that the activities there involved-a local strike-brought them within the provisions of the Anti-Trust Act, notwithstanding the broad terms of that statute. A similar conclusion was reached in United Leather Workers v. Herkert [265 U.S. 457], Industrial Association v. United States, supra, and Levering & Garrigues Co. v. Morrin, 289 U.S. 103, 107. But in the first Coronado case the Court also said that 'if Congress deems certain recurring practices, though not really part of interstate commerce, likely to obstruct, restrain or burden it, it has the power to subject them to national supervision and restraint.' 259 U.S. p. 408. And in the second Coronado case the Court ruled that while the mere reduction in supply of an article to be shipped in interstate commerce by the illegal or tortious prevention of its manufacture or production is ordinarily an indirect and remote obstruction to that commerce, nevertheless when the 'intent of those unlawfully preventing the manufacture or production is shown to be to restrain or control the supply entering and moving in interstate commerce, or the price of it in interstate markets, their action is a direct violation of the Anti-Trust Act.' 268 U.S. p. 310. And the existence of that intent may be a necessary inference from proof of the direct and substantial effect produced by the employees' conduct. International Association v. United States, 268 U.S. p. 81. What was absent from the evidence in the first Coronado case appeared in the second and the Act was accordingly applied to the mining employees.

"It is thus apparent that the fact that the employees here concerned were engaged in production is not determinative. The question remains as to the effect upon interstate commerce of the labor practice involved. In the Schechter case, supra, we found that the effect there was so remote as to be beyond the federal power. To find 'immediacy or directness' there was to find it 'almost everywhere,' a result inconsistent with the maintenance of our federal system. In the Carter case, supra, the Court was of the opinion that the provisions of the statute relating to production were invalid upon several grounds,-that there was improper delegation of legislative power, and that the requirements not only went beyond any sustainable measure of protection of interstate commerce but were also inconsistent with due process. These cases are not controlling here." Footnote39

The opinion further stated that even when full weight is given to the contention that the manufacturing process constitutes a break in the stream of commerce, the fact remains, nevertheless, that stoppage of the operations would have a serious effect upon interstate commerce. In elaboration of this the Chief Justice said:

"In view of respondent's far-flung activities, it is idle to say that the effect would be indirect or remote. It is obvious that it would be immediate and might be catastrophic. We are asked to shut our eyes to the plainest facts of our national life and to deal with the question of direct and indirect effects in an intellectual vacuum. Because there may be but indirect and remote effects upon interstate commerce in connection with a host of local enterprises throughout the country, it does not follow that other industrial activities do not have such a close and intimate relation to interstate commerce as to make the presence of industrial strife a matter of the most urgent national concern. When industries organize themselves on a national scale, making their relation to interstate commerce the dominate factor in their activities, how can it be maintained that their industrial labor relations constitute a forbidden field into which Congress may not enter when it is necessary to protect interstate commerce from the paralyzing consequences of industrial war? We have often said that interstate commerce itself is a practical conception. It is equally true that interferences with that commerce must be appraised by a judgment that does not ignore actual experience." Footnote40

The Supreme Court then called attention to the fact that experience has demonstrated that the recognition of the employee's right to organize and select their own representatives for purposes of collective bargaining has been conductive to industrial peace, and the provisions of the Act preserving such rights were thought valid.

The opinion discusses questions raised under the due process clause. They were disposed of, however, largely upon the same reasoning as that underlying the decision in the cases under the Railway Labor Act, particularly as set forth in the Virginia Railway Co. v. System Federation No. 40.

The basic constitutionality of the National Labor Relations Act was also affirmed in the Washington, Virginia and Maryland Coach Company case by an unanimous opinion of the Supreme Court, holding that the act was not an unconstitutional attempt to regulate intrastate as well as interstate commerce. In view of the fact that eminent lawyers had expressed positive doubts as to the possibility of such a holding, an examination of its basis in previous decisions of the Court on the question of Congressional power under the commerce clause of the Constitution will help not only in understanding the implications of the Coach Company case, but the other four NLRA decisions also.

In 1908 the Supreme Court of the United States had before it the case of Adair v. United States, Footnote41 involving the constitutionality of the Erdman Act of 1989, section 10 of which provided that:

Any employer subject to the provisions of this act and any officer, agent, or receiver of such employer, who shall require any employe', or any person seeking employment, as a condition of such employment, to enter into an agreement, either written or verbal, not to become or remain a member of any labor corporation, association, or organization; or shall threaten any employe' with loss of employment, or shall unjustly discriminate against any employe' because of his membership in such a labor corporation, association, or organization, is hereby declared to be guilty of a misdemeanor, and, upon conviction thereof in any court of the United States of competent jurisdiction shall be punished for each offense by a fine of not less than one hundred dollars and not more than one thousand dollars.

The indictment in this case charged that the defendant Adair, being an agent of a railroad company engaged in interstate commerce and subject to the provision of the act, had discharged one Coppage from its service because of his membership in a labor organization. Mr. Justice Harlan, giving the opinion of the Supreme Court, held, first that it was a violation of the Fifth Amendment for Congress to make it a crime to discharge a workman with whom there was no contract for a fixed term because he was a member of a labor organization. The Court said:

"It was the defendant Adair's right - and that right inhered in his personal liberty and was also a right to property - to serve his employer as best he could, so long as he did nothing that was reasonably forbidden by law as injurious to the public interests." Footnote42

In the second place the Court decided that there was no:

"such connection between interstate commerce and membership in a labor organization as to authorize Congress to make it a crime against the United States for an agent of an interstate carrier to discharge an employee because of such membership on his part. If such a power exists in Congress it is difficult to perceive why it might not, by absolute regulation, require an interstate carrier, under penalties, to employ in the conduct of its interstate business only such members of labor organizations, or only those who are not members of such organizations - a power which could not be recognized as existing under the Constitution of the United States." Footnote43

In short, the Adair case held that the right of an employer to fire employees not under contract was protected by the Fifth Amendment against Congressional interference, and that, moreover, labor organizations in industries admittedly in interstate commerce "have nothing to do with interstate commerce as such." Justices Holmes and McKenna dissented in separate opinions.

On both these points the Washington, Virginia and Maryland Coach Company case seems to reach very different conclusions. In that case the Coach Company operated motor busses for hire between points in the District of Columbia and Virginia. A charge was filed with the National Labor Relations Board by the Amalgamated Association of Street, Electric Railway and Motor Coach Employees of America, alleging the discharge of drivers and garage workmen for union activity, in violation of Section 8, subd. (1) and (3), and Section 3, subd. (6) and (7) of the National Labor Relations Act, forbidding unfair labor practices.

The board rendered its decision, Footnote44 setting forth its findings of fact, and issued an order against the Coach Company, which admitted the interstate character of its business. The Coach Company did not comply with the order of the board, which then petitioned the Circuit Court of Appeals for the Fourth Circuit. The court entered a decree upholding the Act and enforcing the order of the board. Footnote45 Judge Soper, speaking for the court, held that if the finding of fact of the board were supported by evidence, they would not be inquired into, that the Act was not a denial of due process of law guaranteed by the Fifth Amendment, and that the power given to the board by the Act to prevent unfair labor practices in interstate commerce was properly exercised. This judgment of the Circuit Court of Appeals was unanimously affirmed by the Supreme Court. In the argument before the Circuit Court of Appeals the Coach Company relied on Adair v. United States Footnote46 and its companion case, Coppage v. Kansas, Footnote47 involving a state statute and its validity under the Fourteenth Amendment. Said Judge Soper:

"In the first case, an act of Congress was declared unconstitutional which made it a misdemeanor for a common carrier to discriminate against its employees by discharge or otherwise because of membership in a labor union; and in the second case, a state law was declared invalid which made it unlawful for any individual to coerce or influence any person to enter into an agreement not to join a labor union as a condition of securing or continuing employment.

"These citations are not irrelevant, especially Adair v. United States, because there, as here, a carrier engaged in interstate commerce, in the commonly accepted meaning of the term, was involved, and vigorous argument was advanced by counsel for the United States and by the dissenting justices to sustain the act as a reasonable exercise of the power of Congress to regulate commerce between the states. But the difficulties which these decisions oppose to the validity of the National Labor Relations Act seem to us to have been removed by the more recent unanimous decision of the Court in Texas & New Orleans. Ry. Co. v. Ry. Clerks, interpreting the Railway Labor Act of 1926.

"The Supreme Court held that the act conferred the right of independent self-organization upon the employees, free from interference on the part of the employer enforceable by the courts, and that the prohibition upon the carrier was not a violation of the Fifth Amendment, since it did not interfere with the normal exercise of the right of the carrier to select its employees and discharge them. On this ground Adair v. United States and Coppage v. Kansas were distinguished. The Court said (281 U.S. 548, 570): 'The petitioners invoke the principle declared in Adair v. United States and Coppage v. Kansas, but these decisions are inapplicable. The Railway Labor Act of 1926 does not interfere with the normal exercise of the right of the carrier to select its employees or to discharge them. The statute is not aimed at this right of the employers but at interference with the right of the employees to have representatives of their own choosing. As the carriers subject to the act have no constitutional right to interfere with the freedom of the employees in making their selection, they cannot complain of the statute on constitutional grounds.'" Footnote48

The status of Adair v. United States, after the decision of the Supreme Court in the Texas & New Orleans Railway case was certainly not clear. Under the Adair case the employer has a constitutional right to hire and fire for any reason or for no reason. The Railway Labor Act, as interpreted by the Supreme Court, meant that the employer could constitutionally be prohibited from interfering with the right of employees to have representatives of their own choosing. Under the decision in the Texas & New Orleans Railway case, interpreting the Act, could the employer assert the right that was guaranteed him in the Adair case, and discharge every workman who attempted to secure representatives of his own choosing by joining a labor union? True, it is possible to reconcile the cases on the superficial and unsatisfactory ground that "the employee's right to freedom from restraint during the period of employment does not conflict with the employer's right arbitrarily to terminate that period." If this is the true distinction, and Adair v. United States continued to be law after the decision in the Texas & New Orleans Railway case it is clear that the latter was not adequate as a precedent in the Washington, Virginia and Maryland Coach Co. case decided April 12, 1937. In the words of the court, the distinction lies in the fact that under the Railway Labor Act there is no interference with the "normal exercise" of the right of the carrier to select its employees or to discharge them. On what theory can it be said that the employer was not indulging in the "normal exercise" of that right in the Texas & New Orleans Railway, and so could be prevented from the acts in question, but that the employer was in the "normal exercise" of that right in the Adair case? Perhaps it is merely another example of those not infrequent opinions in which the law is laid down with "seemingly studious obscurity," in which we cannot help but leave it. But one may wonder at the unwisdom, from the public's point of view, of leaving intact conflicting lines of authority upon which a court may rely at choice, to reach unpredictable results. Footnote49

In the Jones & Laughlin Steel Corporation case, the board found unfair labor practices in the corporation's Aliquippa, Pennsylvania plant, and issued an order applying to production workers. The record showed that all the raw material coming to the plant was stored from three weeks to three months before it was used. It had not only "come to rest" but had been at rest a long time before it was used. Most of the finished products were not manufactured on contract, but were sold afterwards. The Friedman-Harry Marks Clothing Company case involved production employees. In the Trailer case the board's order affected both production and maintenance workers. So sure were counsel that the activities of these employees were not interstate commerce and that, as to them, the NLRA could not be applied constitutionally, that they did not bother to make a defense except to object to the jurisdiction of the board. The majority did not purport to overrule any of these prior decisions, nor did they define interstate commerce.

The Jones & Laughlin case was well epitomized by a newspaper comment which appeared the day after the decisions were handed down, reading: Footnote50

Supporters of the president's argument that his troubles have been due to the judiciary and not to the Constitution emphasized that under the practical formula set forth by Chief Justice Hughes today what is and what is not within the federal power to regulate commerce becomes purely a matter on which the court will judge according to the practical experience and views of a majority of its members and not in accordance with any scheme which can be precisely defined in legal language.

How far the government's power extends away from the "flow" of interstate commerce is, said the Chief Justice, necessarily a question of degree.

In what direction was the Court headed with these decisions? Did the decisions of April 12, 1937 adopt the principles laid down by John Marshall one hundred and fifty years ago, or did the Court simply adopt a glorified interpretation of the transportation doctrine? The following excerpt from the opinion in the Jones & Laughlin Steel case is probably the best answer the decision affords:

"Giving full weight to respondent's contention with respect to a break in the complete continuity of the 'stream of commerce' by reason of respondent's manufacturing operations, the fact remains that the stoppage of those operations, by industrial strife would have a most serious effect upon interstate commerce. In view of respondent's far-flung activities, it is idle to say that the effect would be indirect or remote. It is obvious that it would be immediate and might be catastrophic. We are asked to shut our eyes to the plainest facts of our national life and to deal with the question of direct and indirect effects in an intellectual vacuum. Because there may be indirect and remote effects upon interstate commerce in connection with a host of local enterprises throughout the country, it does not follow that other industrial activities do not have such a close and intimate relation to interstate commerce as to make the presence of industrial strife a matter of the most urgent national concern. When industries organize themselves on a national scale, making their relation to interstate commerce the dominant factor in their activities, how can it be maintained that their industrial labor relations constitute a foreign field into which Congress may not enter which it is necessary to protect interstate commerce from the paralyzing consequences on industrial war?" Footnote51

Four of the justices dissented in the National Labor Relations Act cases, Mr. Justice McReynolds writing the opinion. In his view the majority had overruled the Schechter case and the Carter Coal Company case. Further, he stated that the circuit judges were right in relying on these cases, and intimated that the opinion of the Court was perhaps not fair to the circuit judges who based their opinions on the most recent decisions of the Court. Mr. Justice McReynolds said:

"We conclude that these causes were rightly decided by the three Circuit Court of Appeals and that their judgments should be affirmed. The opinions there given without dissent are terse, well-considered and sound. They disclose the meaning ascribed by experienced judges to what this Court has often declared, and are set out below in full.

"Considering the far-reaching import of these decisions, the departure from what we understand has been consistently ruled here, and the extraordinary power confirmed to a Board of three, the obligation to present our views becomes plain." Footnote52

It was not clear in 1937, in the Jones & Laughlin case, whether the Supreme Court really based its decision on the meaning of the term "interstate commerce" or not. It was suggested that the Court looked upon the precise meaning of the term as not being involved in a decision of the case, since the Court said that Congress has authority to protect interstate commerce from burdens and obstructions which were not an essential part of its "flow" and that Congress may protect interstate commerce from threats of burdens or obstructions from without. A number of writers have insisted with some vehemence that these decisions have not widened the meaning of the term "interstate commerce," but that they recognize and apply an established rule, that Congress may legislate with respect to activities that burden it, though these activities may themselves be wholly outside of commerce between the states.

In a brief discussion of the National Labor Relations Act cases in the Georgetown Law Journal, a writer states:

The scope of the term 'interstate commerce,' as it has previously been understood and interpreted remains the same. The decisions must be limited to the admittedly serious effect of labor disputes and disorders on the 'free flow of interstate commerce.' Nowhere in any of the majority decisions can it be found or even inferentially stated that there is now vested in Congress, as a result thereof, the power to regulate and control the internal affairs of a business of a purely intrastate character where there can be found no serious restriction or burden on the free flow of commerce between the states.

A like view was entertained by Mr. David Lawrence, who wrote in a syndicated article the following:

The Supreme Court has, in effect, told a hesitant, wavering, doubtful Congress that the federal government does have power to protect interstate commerce against the impediments and obstructions which grow out of serious labor disputes.

Thoroughly consistent with the previous opinions, the Supreme Court has merely called attention with renewed emphasis to a decision rendered in May, 1925, known as the Second Coronado case, which governs almost identically conditions such as exist today.

No new commerce clause has been written into the Constitution, but a definition of what really constitutes obstruction of interstate commerce has been restated with remarkable clarity and force.

The American people generally have won a great victory. Labor, in particular, that is honest, decent, law-abiding labor, has won a triumph unexcelled in American history.

The Court has pointed out that production itself may still be local, just as it was in the coal mining case [the Second Coronado case], but that physical acts or obstruction could interfere with the movement of goods. Footnote53

The draftsmen of the National Labor Relations Act were faced with the problem of preparing a statute which should apply as widely as possible the principles of collective bargaining in labor relations. They could have limited the scope of the Act to labor disputes occurring in interstate commerce, subject to the varying definitions of that term which the Supreme Court might from time to time adopt. It would seem fairly obvious, from a reading of the plain words of the Constitution, giving Congress power to regulate commerce among the states, that labor disputes in interstate commerce would be subject to regulation as a part of that commerce, and under the Railroad Labor Act and the Texas & N.O. Railway case which upheld it, that must have seemed to the draftsmen of the National Labor Relations Act established as law, subject to the Adair case. For it must not be forgotten that the Adair case was not overruled by the Texas & N.O. Railway case, and that, in the Adair case the Court took the view that a labor organization whose membership was employed by an interstate carrier, had, nevertheless, no such substantial relation to or connection with interstate commerce as to Congress to impose criminal penalties for discharging an employee because of his union membership. Said Mr. Justice Harlan:

"What possible legal or logical connection is there between an employe's membership in a labor organization and the carrying on of interstate commerce? It is the employe' as a man, and not a member of a labor organization who labors in the service of an interstate carrier." Footnote54

Nevertheless, in prosecutions and suits under the Sherman Anti-Trust Act, forbidding combinations and conspiracies in restraint of interstate commerce, it has been held that the Sherman Act, "prohibits any combination whatever to secure action which essentially obstructs the free flow of commerce between states;" and that this prohibition includes combinations of labor; that obstructions of business not part of interstate commerce by combinations of labor intended to restrain interstate commerce, or where that would be the necessary effect of the combination, are subject to the prohibition; in other words, that acts of labor organizations in business themselves either within or without interstate commerce, may constitute an obstruction of interstate commerce as to come within the regulatory power of Congress, subject to the requirement that if the acts occur in intrastate commerce, they must "affect" interstate commerce "directly."

It would seem to follow that labor disputes in intrastate commerce would be subject to federal legislation, since their necessary effect, or their intended effect, could be to impose a direct burden upon interstate commerce. Such labor disputes and strikes could be regulated by Congress. The regulation might legally be directed toward encouraging collective bargaining in order to discourage strikes. The theory finds expression in the National Labor Relations Act, which says:

It is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practices and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment, or other mutual aid or protection. Footnote55 (emphasis added).

The dissent of Mr. Justice McReynolds in the National Labor Relations Act cases deserves a brief discussion. The dissent of Mr. McReynolds will be remembered not for what was written in his opinion but how he delivered his opinion. Ordinarily the celebrated dissenter speaks in a low voice, often difficult to hear, but on April 12, 1937, almost every word came clearly and with feeling.

Mr. Justice McReynolds began giving the dissent of the minority as soon as Chief Justice Hughes closed for the majority. He delivered his views extemporaneously, without once looking down at his manuscript, and expressed them in such a way as to be more emphatic than the written words. After announcing the names of those in the minority, he said:

"You may recall that Webster, in one of his orations, suggested that the argument may proceed more profitably if the issue is more narrowly defined. I think I can tell you in a few minutes just what the issue is in this case and give you some understanding of what the decision means.

"If you got the idea that this legislation was intended to prevent strikes and thereby improve commerce, let me read you a few lines of Section 13 of the act, which says that nothing in the act shall impede the right to strike."

It was reported by those in attendance, Mr. Justice McReynolds looked sternly out into the court room as he went on, his voice rising:

"The Labor Act does not prohibit strikes. This act is leveled at employers, and defines as employers any one who acts for employers. The size and character of the enterprise are not involved. Now we are told that this act is intended to restrain any employer from discharging an employee belonging to a labor union - that is, any organization of any kind, or agencies in which the employee participates in whole or in part for dealing with employers.

"We have here three concerns: first, a large integrated steel company; second, a small manufacturer of trailers - an enterprise built up from a small blacksmith shop, largely the work of one man-third, a small clothing manufacturing plant in Richmond, Virginia, hiring less than 1,000 persons.

"The thing they have in common is this, each is a manufacturer, each imports from outside the State raw material, fabricates it and sends it out of the State. There are the essential elements.

"This Court has decided again and again within the last fifty years and particularly in the last two years, that manufacturing is only incidentally related to interstate commerce and that Congress has no authority to interfere with manufacturing, operating as such.

"We had supposed that was settled as much as anything can be settled. Let us take this little concern down in Richmond. It buys its raw materials in New England, brings them down to Richmond, manufactures the cloth in pants and the pants are sold in North Carolina.

"The argument is that this concern is in the 'stream-m-m-m' of interstate commerce and that when this concern is shut up, the 'stream-m-m-m' is blocked. Now the argument is that Congress has the right to say to the people who build up this business. 'You may not discharge a cutter because he belonged to some sort of an association to negotiate wages.'

"Why has this Congress this right?" Justice McReynolds went on in biting tones by declaring:

"Heretofore it was thought that Congress had no such power. But now it is argued that if a strike occurs it may interfere with the operation of factories and that this may prevent goods coming to North Carolina."

Mr. Justice McReynolds then compared the raising of pigs in Iowa, which are subsequently shipped to Chicago. He asked if the precedent set in the National Labor Relations Act cases gave Congress that right to limit pork production in Iowa.

Justice McReynolds denied that the discharge of employees of the Richmond plant had produced any effect on interstate commerce, and went on to say that the National Labor Board was "interfering directly with management, saying who they shall employ."

"If this continues it will bring about a situation from which no man can foresee the end," he added.

"It is said the Congress has the right to remove any obstruction to the free flow of commerce. In the proper sense it has, but interference must be direct and substantial. It has been gone over again and again and again. It is perfectly true that in the Standard Oil and tobacco cases Congress removed threatened interference with interstate commerce."

In his written opinion, Mr. Justice McReynolds said that under the conclusion of the majority, "almost anything, marriage, birth, death - may in some fashion" be held to affect commerce. In the opinion he declares:

"It is gravely stated that experience teaches that if an employer discourages membership in 'any organization of any kind' 'in which employees participate, and which exists for the purpose in whole or part in dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment or conditions of work," discontent may follow and this in turn may lead to a block in the stream of interstate commerce. Therefore Congress may inhibit the discharge! whatever effect any cause of discontent may ultimately have upon commerce is far too indirect to justify Congressional regulation. Almost anything - marriage, birth, death - may in some fashion affect commerce." Footnote56

In speaking, he said that "marriage and babies" could be regulated, and that the marriage of "Mary Jones and John Smith" might be considered in the "stream" of commerce.

Voicing the sentiments of the four conservatives, Justices Van Devanter, Sutherland, Butler and himself, he closed by saying:

"The field opened here is wider than most of the citizens of the country can dream. The cause is so momentous, the possibilities for harm so great that we felt it our duty to expose the situation as we view it."

These words were not in his manuscript. Many others he used were not there, although the trend of thought plainly followed the line he had dictated to a secretary.

His voice drawing but in vigorous accents, he scoffed at the idea that the Friedman-Harry Marks Clothing Company had really been in the "stream-m-m-m-m" of interstate commerce, talked about the "pants" made in the factory and asserted again that if, under the decision, Congress could control the relations between employers and employees, it could exercise supervision over marriage and birth.

After the decision by the majority of the Supreme Court upholding the National Labor Relations Act, several statements were issued by the organizations affected the most by the decision. Head officials of the United Automobile Workers Union who were in Detroit on April 12, 1937, expressed their gratification over the Supreme Court's decision in the National Labor Relations Act cases.

According to Homer Martin, president of the union, the upholding of the validity of the act is a definite step forward in keeping with the spirit and purposes of democracy in the handling of labor disputes. He said:

"Had the act been effective a few months ago the strikes in the automobile industry would never have happened," he said. "Intimidation and coercion are completely eliminated because of the court's ruling. The threat of company unions is removed and the workmen are placed in a position where they can defend themselves against anti-labor tactics. The company will now be forced to deal with representatives chosen by the workers themselves. This is particularly true of the Ford workers, who will be given the opportunity they have sought for several years.

"Beginning immediately, the international union will start a concerted drive among Ford workers. Henry Ford is not bigger than the United States Government. The Supreme Court has given its decision and the law will act. Henry Ford can do but one thing - recognize and deal with the unions, even at the price of changing his mind. Others changed theirs, including the Supreme Court.

"We now look forward to an era of peace and quiet in industry, established by legal recognition of labor's rights and collective bargaining."

Comments in official and congressional circles on the Supreme Court's decision upholding the National Labor Relations Act included the following:

Senator Wagner - "It is a great victory for the people of America. The Supreme Court has thrust aside its more recent stereotyped and narrow generalities concerning Federal Power, and has adopted a broader concept fitting the organic interdependence of our nation-wide social and economic system. No one who reads the decisions of the Supreme Court will believe that there is a need at this time for further Federal legislation dealing with labor relations."

Solicitor General Reed - "This is a realistic approach to the commerce clause of the Constitution."

Senator Walsh - "It seems to me the decision tends to place definitely under the control of the Federal Government the labor relations between employers and employees relating to collective bargaining and unfair labor practices in all the major industries of the country which maintain plants in different States and have an interchange of commerce between such plants."

On April 13, 1937 the Los Angeles Times printed the following editorial:

The Supreme Court yesterday disproved the President's contention that it is biased and prejudiced against New Deal legislation by upholding the National Labor Relations Act in all five of the cases before it. The majority opinion so broadens the meaning of the interstate commerce clause of the Constitution, as that has been generally understood, as to let in a majority of New Deal bills if they are drawn with any care.

So far as the labor unions which fought for this measure are concerned, they have produced a weapon likely to be a boomerang. For if Congress may legislate to regulate labor relations, it plainly may legislate to regulate labor unions.

Earl F. Reed, counsel for the Jones & Laughlin Steel Corporation, said that the Supreme Court decision on the National Labor Relations Act, was one which "cuts both ways." Mr. Reed, regarded in 1937 as one of the best informed sources on labor law, successfully fought the National Industrial Recovery Act in the case involving the Weirton Steel Company. Footnote57 After reading press reports of the decision, he told the Associate Press:

"Apparently each case will depend on its own facts and make it very difficult to advise when the law applies.

"Moreover, the decision cuts both ways. Where the union is the minority group it will have no right to bargain even for its own members."

"Would you say that the contracts which the forces of John L. Lewis Footnote58 have obtained with more than fifty steel corporations to bargain for union members makes them the spokesman for all the workers?" he was asked. Reed replied:

"I would not want to say. Those workers who joined the union for whatever reason would obviously be viewed by the National Labor Board as being under their (the National Labor Board) jurisdiction by their representation in the union contract, while whose workers who freely decide not to join the union for whatever reason would be at liberty to contract for their own wages and conditions of employment free of any interference from the National Labor Board or the union."

Undoubtedly, the Supreme Court did yield to the pressures of public opinion as to changing conditions - and perhaps even to the leverage of Roosevelt's "court packing" bill. But the Court also translated policy (or politics, if you use the word respectfully) into judgment: in short, the Supreme Court also acted in its capacity as an agent of statesmanship.

There are contained in the Constitution clauses, to quote Justice Frankfurter, "so unrestricted by their intrinsic meaning or by their history or by traditions or by prior decisions that they leave the individual Justice free, if indeed they do not compel him, to gather meaning not from reading the Constitution but from reading life." The commerce clause, is one of those. The four minority Justices were consistent in adhering to the restricted definition of that clause set out in the National Industrial Recovery Act and the Guffey decisions. The five majority Justices felt that "reading life" compelled a less restricted interpretation of it.

Needless to say, Mr. Justice Roberts (who moved over to the liberal members of the Court) must have taken a big look at life between 1936 and 1937.

Chief Justice Hughes, in the Jones & Laughlin case said:

"We have repeatedly held that as between two possible interpretations of a statute, by one which it would be unconstitutional and by the other valid, our plain duty is to adopt that which will save the Act."

For the word "Act" in this sentence, substitute the word "Court." That was probably Mr. Justice Robert's answer.

The minority of the Supreme Court feared that it could, but the fact is that nobody could answer this question in 1937. The Supreme Court left the road wide open to the affirmation or denial of these powers. The Court might conceivably hold that while strikes, may seriously obstruct interstate commerce by resulting in a walkout of the employees of industries organized on a national scale, substandard wages, excessive hours and child labor threaten interstate commerce only remotely and indirectly. From this it would follow that Congress would be denied the power to deal with such a question.

But the Supreme Court might just as conceivably hold otherwise. It might just as well find that substandard wages, excessive hours and child labor differ from industrial disputes only in that their paralyzing effect upon interstate commerce is insidiously corrosive and ultimate. As Chief Justice Hughes himself pointed out, the Court does not deal with these questions "in an intellectual vacuum."

In several important respects the National Labor Relations Act cases, decided by the Supreme Court on April 12, 1937, remain landmarks in constitutional law, and among the most important labor decisions of all time. They indicate an expanded interpretation of the term "interstate commerce." The decisions open new avenues under statutory law for the Federal government to control the everyday lives of the people of the states, but the choice was still left for the people to decide if they would allow such control over their activities.

Statutory law is that body of legislation which is designed to provide mandatory and directory instruction from the lawmaker (sovereign) to the subject. The legislative bodies of the States of the Union and the United States of America (Congress), are empowered to act by the State and Federal Constitutions respectively. All of the "powers" these lawmaking bodies possess are delegated powers. They derive from the creative power inherent in the People (citizen of the several States) expressed as political and judicial sovereignty, and can be revoked, in degree or in total by the People, if needed. Surely, one of the most fundamental concepts underlying fundamental American law is that no lawmaking body can pass laws that mandate performance upon the part of any Citizen unless by convention of the People, that power is granted to the legislating body expressly. The only implied power that legitimately exists is that which rests upon the explicit mandates of the constitutional language as present in the charters themselves and clarified, if need be, by the express intentions of the framers. If there is no such clear grant given by the People, then there is no capacity to legitimately pass any law that can compel performance.

It is interesting to note, however, that when Roosevelt was Governor of New York in the 1920's, he protested in behalf of the States against the dishonest and lawless use of the Commerce Clause by the Congress and the President to occupy forbidden ground in the States. Speaking before a conference of governors at New London, Connecticut, on July 16, 1929, he condemned the "stretching" of the Commerce Clause by Congress to cover cases not embraced by grants of power to it in the Constitution. Roosevelt declared:

"Our Nation has been a successful experiment in democratic government because the individual States have waived in only a few instances their sovereign rights...

"But there is a tendency, and to my mind a grievous tendency, on the part of our National Government, to encroach, on one excuse or another, ore and more upon State supremacy. The elastic theory of interstate commerce, for instance, has been stretched almost to the breaking point to cover certain regulatory powers desired by Washington. But in many cases this has been due to a failure of the States, themselves, by common agreement, to pass legislation necessary to meet certain conditions."

The Commerce Clause, contains a principle dating back as far as Magna Carta (1215), when King John, faced by armed men, signed an agreement not to interfere in the right of Englishmen to go to and fro in commerce, and abroad and return, except in an exigency of war.

Englishmen in commerce were "in pursuit of happiness," which the Declaration of Independence later denominated a right from the Creator, for the protection of which "governments are instituted among men."

The speeches and writings of Edmund Burke in behalf of the American colonists make clear that the restrictions on commerce by the government of England were far more burdensome and intolerable than was "taxation without representation," usually given as the cause of the American Revolution.

It was obstruction by States of this right to engage in commerce that contributed much to the breakdown of the government under the Articles of Confederation. And the third grant of power to Congress in the Constitution which followed (after taxing and borrowing) is "to regulate commerce...among the States."

Congress is authorized to regulate commerce so that it will not be obstructed as it was before-that is, it is to promote commerce. It is not to obstruct it affirmatively, any more than the early States could rightly do so.

The history of commerce makes clear that legally it is the most important right of men, not to be trifled with by kings or others in power, including the President and Congress.

Getting back to the way "laws" are passed and enforced today, let us remember that despite what appears to be the intent of the policies and mechanization's of the State and Federal governments, the state Constitutions and the National Constitution are still declarative of the Supreme Law of the Land. All laws, rules, regulations, and treaties not made in pursuance to their mandatory provisions, are null and void. Despite the proclamations of the Supreme Court of the United States, and their apparent significance, that Tribunal understands this fact perfectly, and when faced with issues of Law, properly presented, still rules in a manner consistent with the "Common Law precedents of the past," even though they may adopt language and phraseology designed to be less than obvious. The real question is this: Whether or not the "People" are capable of understanding the concepts upon which the organic Laws of the United States of America are founded, and if so, are they willing to accept the responsibility that goes along with the application of those concepts. In other words, are they willing to be free, self-governing Citizens? The Supreme Court in all their decisions dealing with Roosevelt's New Deal legislation left in the hands of the People the obligation to decide the fate of the Nation.

Footnote1

The complete surrender by the states to the Federal government was finally completed in 1972 with the Revenue Sharing Acts, which are examined in Volume II of this work.

Footnote2

Act of July 5, 1935, c. 372, 49 Stat. 449.

Footnote3

See Chapter 7 for a discussion of the Schechter case.

Footnote4

The opinion of Judge Otis in Stout v. Pratt, 12 F.Supp. 864. Said Judge Otis, at pages 869-870:

"There is now pending in Congress a resolution to amend the Constitution. The first section of the proposed amendment is this: 'The Congress shall have power by laws uniform in their geographical operation to regulate commerce, business, industry, finance, banking, insurance, manufacturers, transportation, agriculture, and the production of natural resources.' When that proposed amendment has been submitted and ratified the statute now under consideration, in the respects considered here, if then re-enacted, certainly will be constitutional. But not until then. Then also what yet remains of the sovereignty of the states will cease to be and the 'citizens' will have become a 'subject.'"

Footnote5

Art. I, Sec. 8, Clause 3.

Footnote6

Simpson v. Shepard, 230 U.S. 352 (1912).

Footnote7

Swift & Co. v. United States, 196 U.S. 375 (1904).

Footnote8

Duplex Printing Press Co. v. Deering, 254 U.S. 443 (1920).

Footnote9

Dayton-Goose Creek Ry. Co. v. United States, 263 U.S. 456 (1923).

Footnote10

United Mine Workers v. Coronado Coal Co., 259 U.S. 341 (1921).

Footnote11

United States v. E.C. Knight Co., 156 U.S. 1 (1894).

Footnote12

Loewe v. Lawlor, 208 U.S. 274 (1907).

Footnote13

Schechter Poultry Corp. v. United States, 295 U.S. 495 (1935).

Footnote14

Id. at 544

Footnote15

Id. at 548.

Footnote16

Id. at 546.

Footnote17

295 U.S. at 546.

Footnote18

Allgeyer v. Louisiana, 165 U.S. 578 (1889).

Footnote19

Chicago, Burlington, & Quincy Ry. Co. v. McGuire, 219 U.S. 549 (1910).

Footnote20

208 U.S. 161 (1907).

Footnote21

Id. at 174.

Footnote22

236 U.S. 1 (1914).

Footnote23

Id. at 19.

Footnote24

Adair v. United States, 208 U.S. 161 (1907).

Footnote25

McLean v. Arkansas, 211 U.S. 539, 547 (1908).

Footnote26

208 U.S. at 191.

Footnote27

88 F.2d 154 (1937).

Footnote28

Id. at 155.

Footnote29

Id. at 155.

Footnote30

85 F.2d 1 (1936).

Footnote31

Id. at 2.

Footnote32

295 U.S. at 542-6.

Footnote33

National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937); National Labor Relations Board v. Fruehauf Trailer Co., 301 U.S. 49 (1937); National Labor Relations Board v. Friedman-Harry Marks Clothing Co., 301 U.S. 58 (1937); Associated Press v. National Labor Relations Board, 301 U.S. 103 (1937); Washington, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U.S. 142 (1937).

Footnote34

301 U.S. 1 at 27.

Footnote35

Id. at 30-2.

Footnote36

Id. at 33-4.

Footnote37

Id. at 34-6.

Footnote38

Id. at 36-7.

Footnote39

Id. at 38-41.

Footnote40

Id. at 41-2.

Footnote41

208 U.S. 161 (1908).

Footnote42

Id. at 172.

Footnote43

Id. at 179.

Footnote44

1 NLRB 769 (1936).

Footnote45

85 F.2d 990 (1936).

Footnote46

208 U.S. 161 (1908).

Footnote47

236 U.S. 1 (1915).

Footnote48

85 F.2d at 993-4.

Footnote49

Perhaps the Supreme Court meant to leave a judicial path open for those who fully understood the true intent behind Roosevelt's New Deal legislation and its subject matter. A discussion on challenging governmental jurisdiction is contained in Volume III of this work.

Footnote50

New York Herald-Tribune, April 13, 1937.

Footnote51

301 U.S at 41.

Footnote52

301 U.S. at 76.

Footnote53

An Independent Judiciary, April 14, 1937.

Footnote54

208 U.S. 161 (1908).

Footnote55

29 USCA 151 (1935).

Footnote56

301 U.S. at 99.

Footnote57

United States v. Weirton Steel Company, 7 F.Supp. 255 (1934). In 1933 while operating under the National Industrial Recovery Act a certain union known as the Amalgamated Association of Iron, Steel and Tin Workers of North America, sought to bring the Weirton Steel Company under the provisions of Section 7(a) of the NRA. Through union representatives sent to Weirton the union sought to sign up a majority of the employees for union representatives. When only a small percent of the employees signed membership cards joining the union, the union representatives and the employees pledged to the union instituted various scare tactics, including the threat of termination for all employees who failed to join the union. As part of their defense, the Weirton Steel Company brought forth employee witnesses to testify against the union and their agents. Mr. Mason, a heater at the Steel Company testified during the trial:

"Q. Will you state what lodge you did join of the Amalgamated? A. Well, in the last part of August, I attended an open meeting of the Amalgamated, and they were discussing dues, and one thing and another, and they said that - it was brought up by a resolution, which was brought before the lodge, that they were going to close the charter right away, and anyone that had not paid in their dues up then, would be assessed $50. So I did not at that night, and the next day, coming down through the mill, Emil Walters, a fellow by the name of John Rawlings was coming down, and he says, "Tom are you going to sign up? I said, "I don't know, it looks like as if I am going to have to." John Rawlings said, "If you are not, your iron is not going to be sheared next week." I said, "What do you mean by that?" He said, "Practically every roller in the plant has signed up, and the majority of them - those rollers that are not signed up by next week are not going to have their iron sheared." Well, I says, "In that case, then, it looks like I will have to." He said, "You certainly are." He says, "If you are not in on the line by next week, by next midnight," he says, "I am afraid you won't have you iron sheared."

Mr. Kinty, a tinner, testified:

"Q. Was anything said to you as to what would happen if they got 51 per cent. of the workers in the Amalgamated? A. Yes, sir; they told me that the U.S. Government would be back of this A.A.

"Q. What do you mean by the A.A? A. This Amalgamated Union.

"Q. The Amalgamated Association? A. Yes, sir. they said when the President (Roosevelt) would get behind their back, it would bring all the boys home.

"Q. Was any statement made to you with respect to the recognition of the Amalgamated Association and what would happen if they came to you? A. They said if the ones did not have a card and unrecognized, they would have no job."

Mr. Miller, a rougher, testified:

"Q Did you join the Amalgamated Association? A. I did.

"Q. Why? A. Because I was told I would lose my job if I didn't."

Footnote58

John L. Lewis was president of the United Mine Workers, and vice president of the American Federation of Labor, until his resignation on November 23, 1935. He resigned from these unions to formed the Committee of Industrial Organization (C.I.O.). The goal of this new militant labor organization, which was secretly endorsed by President Roosevelt, was to create strikes in all industries which would effect or burden interstate commerce, whereby, forcing the Supreme Court into ruling favorably for the newly enacted National Labor Relations Act. The "sit-down" strike technique is credited to the C.I.O.