Outline of Congressional Power to Regulate Interstate Commerce

A. Source of Congressional power to regulate interstate commerce is the Commerce Clause in Article I, Section 8. This power includes the power to regulate interstate commerce itself as well as the power to regulate local commerce if that local commerce has a substantial economic effect on interstate commerce.

B. Scope of Power

1. Power to Regulate Interstate Commerce Itself

a. The power to regulate interstate commerce itself is plenary (unrestricted).

b. The power to regulate interstate commerce itself includes the power to regulate the interstate shipment of goods and the power to regulate the methods of transportation used to accomplish interstate shipment (Gibbons v. Ogden).

c. The power to regulate the interstate shipment of goods includes the power to prohibit the shipment of goods (the commerce prohibiting technique) as in Champion v. Ames (the Lottery Case) and Darby (which overruled the Child Labor Case).

d. The power to regulate the methods of interstate transportation includes the regulation of interstate instrumentalities such as carriers (including interstate railroads, buses, trucks, airplanes, boats (as in Gibbons v. Ogden), etc.) and the power to regulate the channels used by these interstate carriers to transport goods including interstate highways, waterways, bridges, railroad tracks, and the Internet. This also includes the power to protect the channels and instrumentalities of interstate commerce them from both interstate as well as intrastate threats. This is a description of the first two categories described by the Court in Lopez.

e. When regulating interstate commerce itself, the Congressional motive is irrelevant even if the regulation is designed to achieve non-economic objectives such as to promote morality (as in the Lottery Case).

2. Power to Regulate Intrastate Commerce if it Substantially Affects Interstate Commerce

a. When Congress regulates an intrastate economic or commercial activity (as in Wickard v. Filburn, Heart of Atlanta and Perez), the test the court uses is whether Congress could have rationally concluded that the regulated activity has a substantial economic effect on interstate commerce.

i. This test shows great deference to the judgment of Congress, a judgment often, but not necessarily, reflected in Congressional findings, hearings and committee reports.

ii. The substantial economic effects can be found in the aggregate so the question is not whether an individual instance of the regulated activity affects commerce (the wheat grown by farmer Filburn or the guests who stay at the Heart of Atlanta Motel), but whether the regulated activity in its entirety (adding together the impact of each individual instance of the regulated activity) has a substantial economic effect on interstate commerce (all the wheat farmers who grow wheat for home consumption or all the travelers who stay at hotels and motels that discriminate based on race).

iii. Whenever the activities of an enterprise have a substantial economic effect on interstate commerce (such as the wages of workers at a factory that produces goods that are shipped to other states), Congress is permitted to regulate every instance of the activity, including all of the factory’s workers, even if some of those workers are not employed in producing goods for interstate commerce.

iv. When Congress regulates an interstate economic activity or enterprise under a comprehensive regulatory scheme, it may also regulate the aspects of that activity that are intrastate in character (as in Wickard v. Filburn and Gonzales v. Raich). The intrastate aspect of the activity (even if it is an agricultural product grown for home or personal consumption) may be regulated in order to make the entire regulatory scheme effective. This is true where the characteristics of the product are the same, whether intended for interstate shipment or local use (like the wheat in Wickard and the marijuana in Raich) and the failure to regulate the local production would, in the view of Congress, leave a significant gap in the regulatory scheme.

v. The fact that Congress may have been motivated in whole or in part by a moral objective is not relevant so long as the regulated activity also has a substantial economic effect on interstate commerce (as in the case of the Civil Rights Act of 1964 when Congress outlawed racial discrimination in places of public accommodation both because of the immorality of discrimination and also because the discrimination had a negative effect on interstate commerce by discouraging travel by African-Americans).

b. When Congress regulates an intrastate noncommercial, non-economic activity (as in Lopez and Morrison), the court is less deferential to Congress and requires that the activity have a direct and substantial economic effect on interstate commerce.

i. The distinction between economic and commercial activities as contrasted with non-economic and noncommercial activities is evaluated on a case by case basis and the dividing line may be somewhat murky. The question of whether the activity regulated is economic or not may depend on the scope of the Congressional regulatory scheme. If the scheme generally regulates a commercial activity, the Court may be willing to characterize all of the applications of the statute as the regulation of commercial activity even those that reach activity, which viewed in isolation, might be considered noncommercial (such as the medicinal marijuana grown for personal consumption in Raich which was regulated as part of a comprehensive regulation of the illegal drug market).

ii. When Congress regulates a non-economic, noncommercial local activity the Court will be more likely to uphold the regulation if the statute contains a jurisdictional element that requires a connection to interstate commerce be shown in each individual case where the statute is applied (such an element was missing in both Lopez and Morrison, but is present in the amended version of the Lopez statute).

iii. The presence or absence of Congressional findings are not determinative (they were present in Morrison, but absent in Lopez), but such findings may help to demonstrate the existence of a substantial economic effect on interstate commerce.

iv. The substantial effect on interstate commerce needs to be based on more than limitless arguments that would be available whenever Congress regulates violent crime and can show a connection between the crime and a reduction in economic productivity (Morrison). Without such a limit, Congress would have the equivalent of a federal police power.

v. The substantial effect on interstate commerce needs to be more direct and not based on an attenuated series of links in a chain that may connect an activity to a decline in education and then to a less qualified workforce and then to a decline in economic productivity (Lopez).

vi. Also relevant in these cases is whether the regulated activity (education or family relationships, for example) is one that has been traditionally the province of the states and not the federal government.

vii. In the case of non-economic, violent crime, the Court will not allow Congress to regulate “based solely on that conduct’s aggregate effect on interstate commerce.” (Morrison at page 175). It is not yet clear whether a similar restriction will be applied to Congressional regulation of all non-economic, noncommercial activities (see Morrison at p.174).