Having created the national government, and recognizing the potential for abuse of power, the states sought through federalism to constrain it. The “traditional system” of a weak national government prevailed for over a century despite eco- nomic forces favoring the national government’s expansion and despite Supreme Court cases giving a pro-national interpretation to Article I, Section 8, of the Constitution.
That article delegates to Congress the power “to regulate Commerce with for- eign Nations, and among the several States and with the Indian Tribes.” For most of the nineteenth century, the Supreme Court consistently interpreted this com- merce clause in favor of national power over the economy. The fi rst and most important such case was McCulloch v. Maryland (1819), which involved the ques- tion of whether Congress had the power to charter a national bank, as such an explicit grant of power was nowhere to be found in Article I, Section 8.8 Chief Jus-
tice John Marshall answered that this power could be “implied” from other powers that were expressly delegated to Congress, such as the “powers to lay and collect taxes; to borrow money; to regulate commerce; and to declare and conduct a war.”
By allowing Congress to use the necessary and proper clause to interpret its delegated powers expansively, the Supreme Court created the potential for an unprecedented increase in national government power. Marshall also concluded that whenever a state law confl icted with a federal law (as in the case of McCulloch v.
Maryland ), the state law would be deemed invalid, since the Constitution states
that “the Laws of the United States . . . shall be the supreme Law of the Land.” Both parts of this great case are pro-national, including the verifi cation of the principle of “national supremacy,” yet Congress did not immediately seek to expand the policies of the national government.
Another major case, Gibbons v. Ogden (1824), reinforced this nationalistic interpretation of the Constitution. The important but relatively narrow issue was
whether the state of New York could grant a monopoly to Robert Fulton’s steam- boat company to operate an exclusive service between New York and New Jersey. Chief Justice Marshall argued that New York state did not have the power to grant this particular monopoly. In reaching this decision, Marshall had to defi ne what Article I, Section 8, meant by “commerce among the several states.” He insisted that the defi nition was “comprehensive,” extending to “every species of commercial intercourse.” However, this comprehensiveness was limited “to that commerce which concerns more states than one.” Gibbons is important because it established the supremacy of the national government in all matters affecting what later came to be called “interstate commerce.”9 But the precise meaning of
interstate commerce would remain uncertain during several decades of constitu- tional discourse.
Backed by the implied powers and national supremacy decision in McCulloch and by the broad defi nition of “interstate commerce” in Gibbons, Article I, Section 8, was a source of power for the national government as long as Congress sought to facilitate commerce through subsidies, services, and land grants. Later in the nine- teenth century, though, the Supreme Court declared any effort of the national gov- ernment to regulate commerce in such areas as fraud, the production of substandard goods, the use of child labor, or the existence of dangerous working conditions or long hours to be unconstitutional as a violation of the concept of interstate com- merce. Such legislation meant that the federal government was entering the factory
States’ rights have been embraced by many causes in the past 50 years. Governor George Wallace of Alabama, a vocal supporter of states’ rights, defi antly turned away U.S. attorney general Nicholas Katzenbach, who tried to enroll two black students at the University of Alabama at Tuscaloosa in 1963.
7 2 C H A P T E R 3 F E D E R A L I S M
and the workplace—local areas—and was attempting to regulate goods that had not yet passed into interstate commerce. To enter these local workplaces was to exer- cise police power—a power reserved to the states. No one questioned the power of the national government to regulate businesses that intrinsically involved interstate commerce, such as railroads, gas pipelines, and waterway transportation. But well into the twentieth century, the Supreme Court used the concept of interstate com- merce as a barrier against most efforts by Congress to regulate local conditions.
This interpretation of federalism gave the American economy a freedom from federal government control that closely approximated the ideal of free enterprise. The economy was never entirely free, of course; in fact, entrepreneurs themselves did not want complete freedom from government. They needed law and order. They needed a stable currency. They needed courts and police to enforce contracts and prevent trespass. They needed roads, canals, and railroads. But federalism, as interpreted by the Supreme Court for 70 years after the Civil War, made it possible for business to have its cake and eat it, too. Entrepreneurs enjoyed the benefi ts of national policies facilitating commerce but were shielded by the courts from poli- cies that regulate commerce by protecting the rights of consumers and workers.10
In addition, the Tenth Amendment was used to bolster arguments about states’ rights, the principle that the states should oppose the increasing authority of the national government. This principle was most popular in the period before the Civil War.
In the early twentieth century, however, the Tenth Amendment appeared to lose its force as reformers began to press for national regulations to limit the power of large corporations and to protect the health and welfare of citizens, as we shall see next.