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some interesting and relevant history...

Obama’s Seizure and Truman’s


By Garland Tucker

January 31, 2012

On November 14, 2011, the Supreme Court agreed to review the constitutionality of President Obama’s health-care act. The central question is, What limits does the Constitution — specifically, the Commerce Clause — impose upon the federal government’s exercise of power? This health-care act is the defining legislation of the president’s term, and the issue of limited government is at the very heart of the debate between Obama and his opponents. The political, economic, and constitutional stakes are very high. These arguments before the Court will provide a dramatic — and perhaps even decisive — backdrop for the 2012 election.

Constitutional crises of this magnitude are not without precedent. Indeed, the seeds of this case can be found in the court battles of the 1930s and 1940s, as Franklin Roosevelt’s New Deal legislation challenged traditional constitutional bounds. Supported by record congressional majorities, FDR and his fellow Democrats passed a blizzard of programs designed to alleviate the economic hardship of the Great Depression — and to alter the very fabric of the U.S. capitalistic system.

The 1932 Democratic platform, largely written by the party’s 1924 nominee, John W. Davis, was a clear statement of conservative, Jeffersonian principles, but FDR abandoned this platform during his first hundred days in office. So radical were the changes that by 1935, conservatives — Democrats and Republicans alike — agreed with Davis when he wrote, “If the structure of this Government is to be preserved, the courts must do it.”

As conservatives looked in desperation to the judiciary for relief, Davis was their logical leader. A highly esteemed former solicitor general under President Wilson, former ambassador to Great Britain, former president of the American Bar Association, and senior partner at one of New York’s premier law firms, Davis commanded respect from all quarters of the political and legal spectrum. As a founder of the bipartisan, anti–New Deal Liberty League in 1934, Davis repeatedly wrote to his supporters, “I believe in the Constitution of the United States; I believe in the division of powers that it makes. I believe in the right of private property, the sanctity and binding power of contracts; the duty of self-help. I am opposed to confiscatory taxation, wasteful expenditure, socialized industry, and a planned economy controlled and directed by government functionaries. I believe these things to be inimical to human liberty and destructive of American ideals.”

Sensing the gravity of the crisis, Davis seized every opportunity and expertly wielded every legal weapon at his disposal to thwart the New Deal. Publicly labeling the Agricultural Adjustment Act (AAA) “a bribe to farmers,” he signed the amicus curiae brief and successfully led the fight that ultimately resulted in the court’s 6–3 ruling that the AAA was unconstitutional. He successfully opposed the Public Utility Holding Act in the lower courts and led the fight against it within the American Bar Association. Davis personally argued the unconstitutionality of the Frazier-Lemke Bankruptcy Act and the National Labor Relations (Wagner) Act before the Supreme Court.

When Roosevelt responded to these courtroom defeats by setting forth his infamous court-packing scheme in 1937, it was Davis who advised the New Deal’s congressional opponents in defeating the measure. By the late 1930s, he had earned the New Dealers’ enduring enmity, and he wore with pride their sobriquet, “Public Enemy Number One.”

During the course of these battles, Davis repeatedly warned that “paternalism fastens its grasp upon the country, and, little by little, the practice of local self-government fades away. Baptize a scheme, even the most fantastic, with a high-sounding and attractive title, and it will elicit the public support.” Of the failure to limit government, he admonished, “Nothing but mischief, to my way of thinking, can come from any government attempting tasks which lie beyond its power to accomplish.” Ever clear about the indivisibility of property rights from human rights, Davis contended, “The two are not antagonistic. History furnishes no instance where the right of man to acquire and hold property has been taken away without the complete destruction of liberty in all its forms.”

Davis’s crowning achievement as Public Enemy Number One came in 1952 in one of the most famous cases in U.S. constitutional history. In Youngstown Sheet & Tube Co. v. Sawyer, widely known as “the steel-seizure case,” an overly confident, overreaching president was unexpectedly halted by the bounds of the Constitution.

The steel-seizure case arose from a crisis in the prosecution of the Korean War. By late 1951, the war demands had resulted in record output from the U.S. steel industry. Subsequently, the steelworkers demanded a 35-cents-per-hour wage increase, and the unions threatened a strike that would have crippled the war effort. Negotiations at the Wage Stabilization Board postponed the showdown until the following spring, but the unions and the steel companies had intractably squared off by April of 1952. For political reasons, President Harry Truman — ever the partisan Democrat — refused to invoke the Republican-authored Taft-Hartley Act, by which the government could temporarily enjoin a strike.

Truman harbored a deep distrust of corporate America, siding instinctively and decisively with the unions. When Treasury Secretary Snyder urged caution, Truman snorted, “The president has the power to keep the country from going to hell.”

On the evening of April 8, the president addressed the nation dramatically by radio and announced that the steel companies were “trying to get special, preferred treatment. . . . And they are apparently willing to stop steel production to get it. As president of the United States it is my plain duty to keep this from happening. . . . At midnight, the government will take over the steel plants.”

By the following morning, management of the steel industry had been handed over to Secretary of Commerce Charles Sawyer. But with this bold move to end the impasse, Truman had initiated a new crisis — a constitutional crisis. In brazen disregard for any pretense of respect for separation of powers, Truman and Chief Justice Fred Vinson had discussed the possibility of seizure by the government, and Vinson had assured the president he was within his rights.

The public outcry against the administration’s action was immediate, and the steel companies quickly sued to recover their property. Federal Judge David Pine ruled that the seizure was illegal, and the Supreme Court agreed to hear the case.

During this escalating crisis, the steel companies sought Davis’s counsel. By that time, he had argued more cases before the Supreme Court (138) than any American save Daniel Webster. Convinced for the past 30 years that the government was dangerously overreaching its constitutional bounds, Davis had become the universally acknowledged appellate champion of constitutional restraint and limited government. It was natural that Republic Steel would seek his counsel, and the other steel firms agreed to have him alone argue the case.

By 1952, the Court was constituted entirely of Democratic appointees. Conventional wisdom held that this Court would willingly embrace any expansion of government power. Certainly, President Truman was extremely confident that his action would be upheld. He had confided to Secretary Snyder that he would be “terribly shocked, disappointed, and disturbed” should he lose.

On May 12, Davis rose to make his 139th argument before the Supreme Court, arguing that Truman’s action was not only “a usurpation of power without parallel in American history” but also a “reassertion of kingly prerogative, the struggle against which illumines all the pages of Anglo-Saxon history.” Davis drew repeatedly on the conservative Jeffersonian principles that had guided his long career and rested his case with Jefferson’s own words: “In questions of power, let no more be said of confidence in man, but bind him down from mischief by the chains of the Constitution.”

On June 2, after barely three weeks of deliberation, the Court ruled 6–3 that the seizure was unconstitutional. This was indeed a stunning triumph for constitutionalism. For the majority, Justice Hugo Black wrote, “We cannot with faithfulness to our constitutional system hold that the Commander in Chief of the Armed Forces has the ultimate power as such to take possession of private property .” The even more left-leaning Justice William O. Douglas concurred: “Today a kindly President uses the seizure power to effect a wage increase and to keep the steel furnaces in production. Yet tomorrow another President might use the same power to prevent a wage increase or to regiment labor as oppressively as industry thinks it has been regimented by this seizure.”

Davis’s key insight was that “the limitations which our Constitution seeks to impose are not intended to prevent Government from doing those things which no one could wish to do on any pretext, but rather to fix the bounds which cannot be exceeded even by conscious rectitude and righteous people.” Today, a confident Nancy Pelosi asks dismissively, “Are you serious?” at the suggestion that the effective federal seizure of American health care might be ruled unconstitutional. She and President Obama would well ponder the words of their fellow Democrat John W. Davis.