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Law and Legal Studies

Two Views on Judicial Activism

by Gregory F. Rehmke

The 16-page booklet, "Two Views of Judicial Activism," features the views of (now) Supreme Court Justice Antonin Scalia and University of Chicago Law Professor Richard A. Epstein. The essays are from a 1985 conference held by the Cato Institute, and the constitutional issues covered are as old as the republic...

"Judicial Activism" is the phrase applied to judgements handed down by the courts that invalidate, rather than merely interpret, Congressional legislation. The Supreme Court is charged with defending the Constitution, and when state or federal laws are judged to violate provisions of the Constitution, it is the Supreme Court's job to strike them down. But what sorts of laws have been judged to violate the Constitution?

Rise and fall of "substantive due process"

Beginning in the 1870s, and increasingly after the Lochner v. New York decision in 1905, the Supreme Court struck down regulations that infringed on economic liberties. The "due process" clause of the Fifth Amendment states: "No person shall…be deprived of life, liberty, or property, without due process of law…" The Supreme Court doctrine of "substantive due process" developed to protect substantive rights&emdash;private property and contracts&emdash;from new economic regulations. In addition, the "contracts clause" in Article 1, Section 10 ("No state shall…pass any…Law impairing the Obligation of Contracts…") was viewed by the court to mean exactly what it says. (Minimum wage laws, for example, were viewed as an infringement of the right of people to make voluntary contracts.) Other sections of the Constitution were also cited to defend the rights of contract and property from "social" legislation passed by state and federal governments in the first decades of this century.

Beginning in 1937, President Roosevelt began to replace Supreme Court justices appointed by earlier administrations with justices who shared his view that the federal government needed far wider powers to regulate economic activity. Many of Roosevelt's New Deal agencies and activities were judged unconstitutional by the old Supreme Court. Impatient and frustrated, Roosevelt proposed to "pack" the court by adding one of his appointees for each current justice over the age of 70, thus increasing the number of justices until his economic legislation would be left untouched by the court. (Six justices were then over 70.) This proposal caused a public uproar and was defeated even in the heavily Democratic Congress. Instead a bill was passed to allow Supreme Court Justice to retire with full pay (instead of half-pay), and conservative Justices Van Devanter and Sutherland agreed to retire.

Roosevelt's Supreme Court quickly discarded the notion that the Constitution, through "substantive due process," protected property and contracts from government legislation and regulations.

The return of judicial activism

In the 1950s and 60s, particularly under the influence of Chief Justice Earl Warren (1953-1969), the Supreme Court began again to invalidate legislation&emdash;giving wider interpretation to the personal rights listed in the First Amendment, and calling upon more of the Bill of Right's protections to invalidate state laws (citing the language of the Fourteenth Amendment).

Participants in this second era of "judicial activism" are now in the minority, and appointees of the Nixon, Ford and Reagan administrations dominate the court. New Supreme Court justice Antonin Scalia is particularly opposed to judicial activism. Scalia explains why in "Economic Affairs as Human Affairs." In "Judicial Review: Reckoning on Two Kinds of Error," Richard Epstein responds, making the case for a renewed judicial activism.

Scalia's position: the case against judicial activism

In his essay Antonin Scalia argues first that it is just too late for the Supreme Court to return to enforcing substantive due process. He points out that, "The Supreme Court decisions rejecting substantive due process in the economic field are clear, unequivocal and current…" Scalia contends that for the Supreme Court to now protect economic liberties, as Epstein insists it should, would lead the court back into the realm of judicial activism. And Scalia believes this is dangerous for two reasons.

First, why should we think the Supreme Court competent to judge the economic consequences of legislation? Judges are trained in law, not economics, and to have them review the economic effects of legislation is to invite error and abuse. If the court were to resume protecting economic liberties, how wide a range of Constitutionally protected rights might emerge?

Scalia considers it possible that some future court might hold that every worker has an economic right to "just and favourable remuneration [pay] ensuring for himself and his family on existence worthy of human dignity." Since many now believe this is or should be every person's natural right, why not have the Constitution guarantee it? And Scalia warns, "Lest it be thought fanciful, I have taken the formulation of this right verbatim from Article 23 of the United Nations' Universal Declaration of Human Rights." Economic arguments explaining the incompatibility of such a "right" with a market economy may not, Scalia suggests even be considered by the court.

Second, Scalia argues that though economists may see the merit of protecting private property and contract from government regulations and legislation, most academics and intellectuals no longer share these views. In the earlier decades of court-protected substantive due process, there was wide public and academic support for the sanctity of property and contract. Scalia argues that times have changed, and with them popular beliefs: "I do not detect the sort of national commitment to most of the economic liberties generally discussed that would enable even an activist court to constitutionalize them. That lack of sentiment may be regrettable, but to seek to develop it by enshrining the unacceptable principles in the Constitution is to place the cart before the horse."

Scalia insists we must take a different course to regain stronger protection of economic rights: "If you are interested in economic liberties, then, the first step is to recall the society to that belief in their importance which (I have no doubt) the founders of the republic shared."

Epstein's reply: two kinds of errors

For Richard Epstein there is more to the story than the possibility that judges might err in trying to protect economic liberties. Judges may not be perfect or all knowing or even knowledgeable about economics, but what about legislators and bureaucrats? Are they then to be given free rein to decide right and wrong in the acquisition and distribution (or redistribution) of property? Epstein argues no: "The constitutionality of legislation restricting economic liberties cannot be decided solely by appealing to an initial presumption in favor of judicial restraint. Instead, the imperfections of the judicial system must be matched with the imperfections of the political branches of government."

It is the nature of government to hold a monopoly over the legal use of force. Says Epstein, "When we put someone in charge of the collective purse or the police force, we in effect give him a spigot that allows him to tap into other people's property, money, and liberty." Epstein argues that our constitutional system was designed with a strong skepticism of government power&emdash;as seen in the multitude of checks and balances that pit branches of government against each other. If the courts refuse to review legislation affecting property and contract, then balance is lost and, Epstein warns, the "power of coalition, the power of factions, the power of artifice and strategy" are let loose in society.

After reviewing the general theory of constitutional government, Epstein points out that the debate need not be so abstract, for here in America we have "an actual constitution, and since it is a written one, we can check to see how it handles the particular problems of protecting economic liberties." The Constitution contains a number of specific provisions "designed to limit the jurisdiction of both federal and state governments." Among those are the eminent domain clause, the contract clause, the privileges and immunities clauses, the equal protection clause, and the due process clause. And Epstein insists: "These provisions are not curlicues on the margins of the document; they are not without force or consequence. They are provisions designed to preserve definite boundaries between public and private ordering."

Next Epstein attacks the current Supreme Court doctrine of "the plausibility test." If legislation disturbing economic liberties has some stated end that seems plausible, then the court lets the legislation be. Epstein rejects this doctrine of judicial restraint: "It turns out that Scalia's position, already stated even more forcefully by the Supreme Court itself, completely abandons the idea that serious intellectual discussion can yield right and wrong answers on matters of political organization and constitutional interpretation. Courts simply give up before they try… Anything legislatures do is as good as anything else they might have done; we cannot decide what is right or wrong, so it is up to Congress and the states to determine the limitations of their own power&emdash;which, of course, totally subverts the original constitutional arrangement of limited government."

What are the costs of allowing legislatures full license to interfere with private property and contracts? Epstein gives this warning: "The moment courts allow all private rights to become unstable and subject to collective (legislative) determination, all of the general productive activities of society will have to take on a new form. People will no longer be able to plan private arrangements secure in the knowledge of their social protection. Instead, they will take the same attitude toward domestic investment that they take toward foreign investment. Assuming that their enterprise will be confiscated within a certain number of years, domestic investors will make only those investments with a high rate of return and short payout period, so that when they see confiscation coming, they will be able to run…[G]iven our record of price controls and selective industry regulation, it is clear that the once great protections we once enjoyed have been compromised…

"Our guiding principle should derive from our Lockean tradition [after the writings of John Locke]- a tradition that speaks about justice and natural rights, a tradition that understands the importance of the autonomy of the person, and respects it in religion, in speech, and in ordinary day-to-day affairs."

In reaching for this ideal, Epstein says, we cannot forget that the New Deal happened, but we can move gradually toward reaffirming Constitutional protections of property and contract. Two types of errors may be made by the Court and, Epstein argues Scalia has focused on only one. Errors of commission (called type I) and errors of omission (called type II) may be made in judicial decisions. A type I error would be one where judicial activism establishes some economic right where none is specified in the Constitution. A type II error occurs when the courts do not act to protect an economic right clearly protected in the Constitution. Epstein concludes: "What Scalia has, in effect, argued for is to minimize type I error. We run our system by being most afraid of intervention where it is not appropriate. My view is that we should minimize both types of error."

Decisions can be wrong, and no one- not Senator nor Congressman nor Supreme Court Justice- can be sure to escape error. But the Constitution was designed to prevent a systematic kind of error that follows from the accumulation of political power (see "Power and Liberty" by Bernard Bailyn, in the February issue of Econ '87). The framers deeply distrusted the centralized political power they had created in the new federal government. To guard against the growth of this power they wrote a Constitution and charged a Supreme Court to defend it. Fear of error, Richard Epstein believes, is insufficient reason not to enforce economic liberties; the Supreme Court, he says, must take these "constitutional protections of economic liberties at their face value."


Available from the Cato Institute...

• Scalia v. Epstein: Two Views on Judicial Activism by Supreme Court Justice Antonin Scalia and Professor Richard Epstein. These articles are edited versions of the authors' remarks delivered at the Cato Institute's conference "Economic Liberties and the Judiciary" on October 26, 1984. Justice Scalia and Professor Epstein spar over the wisdom of granting explicit constitutional protection to economic liberties. (1985/16pp. $1.00)

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Gregory F. Rehmke