Teh Commerz Clawz: A.L.A. Schechter Poultry Co v. US

Om nom nom!

Welcome back to Teh Commerz Clawz, where I explain the precedent to the states’ challenge of the Health Care Bill in super simple speak. Also usually with lolcatz. Because boring law is far more entertaining when there are cute kitties saying silly things.

If you remember, when we left off last week, we were talking about how teh lolcows in Swift v. US established that there is this thing called a “stream of commerce.” This stream means that if things in intrastate commerz are part of the stream of commerz running through the states, like cows stopping at a stockyard, then they count as interstate commerz. But, now the question becomes, where does that stream stop and start?

I actually put off talking about this case until long enough after Thanksgiving that I could stomach it again. Literally. (Anyone who has read Upton Sinclair’s The Jungle knows what I’m talking about.)

This case places us square in the middle of the Great Depression. FDR passed a bunch of laws meant to turn around the failing economy, including laws on wages, fair trading procedures, unions, etc. Big business wasn’t happy about it.

Roosevelt: Teh country iz dieing. I will regulate all teh shizz, and so no onez will be hurt any moar! Yay!
Big business: No! You canz no do that! Iz bad for business! Iz too much powr for u! U iz only Prezident, u can no taek all teh powr 4 urself!

What loyality to laissez-faire economics looked like in the Great Depression

Matter of fact, the Supreme Court wasn’t either. They kept striking down piece after piece after piece of Roosevelt’s New Deal.

Supreme Court: No! We liek teh laissez-faire economicz! We thinkz u iz trying to taek 2 much powr for u! We will taek away all ur bills! No bills 4 u!

Enough that at one point FDR tried to implement his famous court packing plan, leading to the saying “the switch in time that saved nine.” Thankfully, Justice Roberts changed his mind last minute, but point is, the Supreme Court and FDR were not buddies for quite a while.

In the fight leading up to the court packing plan, enter A.L.A Schechter Poultry Corp v. US.

Roosevelt passed this bill called the National Industrial Recovery Act. In it, he regulated the sale of sick chickens. See, people liked to sell sick chickens to butchers for the regular price, then people would eat them and get sick while other people still made a ton of money. Not so good, right? Besides, who wants to eat a sick chicken? Gross.

The law also did other things like regulating working wages and setting prices for things. People didn’t like that either. Too much government intervention and socialism and such (sound familiar?) But anyway, Schechter got charged with, among other things, “sale to a butcher of an unfit chicken.”

Schechter decided to take the government to court over it instead of paying the fines. Schechter held that NIRA was unconstitutional, in part because it overextended the powers of teh Commerz Clawz.

Schechter: I onli sellz mah chickens to intrastate ppls, and I onli buy mah chickens frum intrastate ppl. There iz no interstate commerz. Congress and teh Prez can no regulate this. Iz onli for teh states, iz not part of teh streem of commerz!
U.S.: This haz a direct effect on commerz. Ppl being sick affects commerz. Bad business practices affect commerz. So we can haz regulation, yo!

supreme court justices with cat heads

Om nom nomz!

Teh Supreme Court agreed with Schechter. If you remember last time, we were talking about how while there’s a stream of commerce, at some point there’s a beginning and an end to every stream. Teh Court held that the sick chicks are at the end of the stream.

Juztice Sutherland (evil wolf kitteh at right): “When 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 slaughterhouses in Brooklyn… The interstate transactions in relation to that poultry then ended.” Basically, when teh chickenz reached New Yoahk, they were onli soldz in New Yoahk. No moar interstate commerz.

This means that there iz no way teh govt can argue this iz interstate commerz. We kno it when we seez it, and this iz not it. “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 held solely for local disposition and use.” After something goez into teh state, and iz not leaving again, then it iz not interstate commerz. Teh end.

U.S.: NO! Iz not teh end! These practices affect interstate commerz! Iz bad for business and for eberything!

Juztice Sutherland: Rong! Member? We toldz u b4! Some things haz a direct effect on interstate commerz. You can haz regulation of that. But sick chickz onli has an indirect effect on commerz. Even if this iz bad for business, that is for teh state to taek care of. Iz no for you. Go ‘way!

So now we’ve established that not only is there a stream of commerce, but it has a definite end. Once something is not going back out of the state to be sold, it’s then part of intrastate commerce. Tomorrow, or the next day depending on my schedule with finals coming up, we shall discover where this stream of commerce starts! (There’s more that goes into these challenges than you thought, isn’t there?)




2 thoughts on “Teh Commerz Clawz: A.L.A. Schechter Poultry Co v. US

  1. Pingback: Teh Commerz Clawz: Carter v. Carter Coal « What Policy Dorks Do for Fun

  2. Pingback: Teh Commerz Clawz: NLRB v. Jones & Laughlin Steel Corp « What Policy Dorks do for Fun

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