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Wednesday, July 09, 2008

The anemic spending power of the States

As the resident federalism nut on this blog, I feel obliged to offer a federalism scorecard for the Roberts Court's '07-'08 term. My tentative assessment is that the Court has gutted the states' spending powers Exhibit A for this thesis is a comparison between the Court's opinion in Chamber of Commerce v. Brown (about which I posted an anticipatory comment before the Court handed down the opinion).

In a 7-2 decision, the Court held that Machinist preemption bars California from requiring that contractors receiving money from the state not spend that money on anti-union activities. In short, the state may not look for the union label: When it purchases goods or services, it has to turn a blind eye to what it might regard as egregiously unjust anti-union behavior by the contractor.

Brown is an astonishingly nationalistic opinion in the three following senses:

(1) Brown gives states less power than the most ordinary consumer who remains free to boycott anti-union businesses. One can, therefore, make a respectable argument that Brown does not qualify as a "generally applicable law" Printz and thereby arguably encroaches on constitutionally protected state autonomy by commandeering the states' budget to serve some federal end of insuring that employers' anti-union activity remains unregulated.

(2) Brown rejects arguments for a broad state spending power that the Court has accepted in adopting a broad federal spending power. California argued that it was not "regulating" employers but merely placing conditions on state money. The Court did not buy this argument: The conditions, according to the Court, were tantamount to preempted regulation. But note that the Court routinely accepts precisely the same argument when the feds argue that their conditions on federal grants do not exceed Congress' enumerated powers, because those conditions are really not regulations at all but merely a non-coercive quid pro quo in return for federal money. The Court accepts the federal version of this argument even when the conditions bear only the most attenuated relationship to the expenditure of federal money -- indeed, even when the conditions primarily affect how the states spend their own revenue, as the Court held in Sabri v. United States, 541 U.S. 600 (2004).

(3) The most astonishing aspect of Brown is that the underlying federal statutes -- the NLRA and Taft-Hartley Act -- say nothing whatsoever about preemption. Machinist preemption is purely a piece of purely judge-made common law. The Court was, therefore, at liberty to think a bit about the constitutional and policy implications of the gaping hole that it was carving in state powers. Instead, the Court mechanically applied some old precedents without mentioning that the importance of giving states control over their own fiscs.

If it were not for Kentucky Dep't of Revenue v. Davis (on which I posted earlier), I'd say that this term had been an unmitigated disaster for state spending power. Kentucky Dep't of Revenue, however, loosened dormant commerce clause limits on state spending powers. It seems that the Court is more willing to cut states slack when they compete with each other for business than when they compete with federal labor policy.

Posted by Rick Hills on July 9, 2008 at 07:58 PM | Permalink


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True enough: Federalism, like other second-order values, will tend to have less grip on both justices and laity than their desire for particular results in a particular case.

This tendency to short-change the institutional and procedural, however, is not confined to federalism. Consider, for instance, the second-order value of democratic decision-making. In theory, We the People are committed to it. In practice, we tend to embrace it only when democracy produces results that we like. Thus, conservatives routinely deploy Thayer's presumption in favor of legislative decisions when calling for the overturning of Roe: "When in doubt about the meaning of a constitutional provision," they say, "uphold the legislature's good-faith interpretation of that provision." But when it comes to takings, affirmative action, or state restrictions on money for religious speech, this commitment to legislative democracy goes out the window.

Therefore, I'd expect federalism, commitment to democracy, commitment to free speech in general, commitment to procedural regularity in civil and criminal trials, and a host of other second-order values to get short shrift in most decision-making.

That said, these values sway the justice in the middle who is undecided on the substantive merits of the issue. There is no other way to explain O'Connor's, Rehnquist's, and Thomas' dissents in Raich, for instance.

Posted by: Rick Hills | Jul 10, 2008 10:39:19 AM

I'm a labor law guy, I hadn't thought about Brown in this context at all, and this is a really interesting and persuasive post.

Having said that, I'm wondering about the critique that, when it comes down to it, most folks -- including Supreme Court justices -- just aren't really that committed to states' rights/federalism issues (as opposed to the substantive policy issues the cases raise). See, e.g., Scalia on state authority over medical uses of marijuana.

Posted by: Joseph Slater | Jul 10, 2008 10:20:20 AM

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