LAW 531-001 – Constitutional Law I

Commerce Clause


Marshall Approach

The Marshall analysis requires both a valid subject and object.

Subject

First, the subject of the statute must be determined. The subject of the commerce clause is "commerce" "among the several states."

Regardless of whether the subject of the statute is commerce or not, it still requires a valid object. If the subject is commerce, it must be calculated to effect a valid object, while under the Necessary and Proper Clause, the subject must be plainly adapted to the object.

Object

Then, the object of the statute must be determined and analyzed.

Marshall listed three possible objects for valid exercise of the commerce clause:

  1. To remove discriminatory trade barriers imposed on out-of-staters
  2. To promote harmonious relations among the states
  3. To preempt or remedy state laws
Current Approach

The Marshall analysis has been largely abandoned for the Commerce Clause.

Basically go: ChampionWickardLopezRaich

The object test was removed in Champion, which instead allows any statute which is calculated to effect a police power. Now, virtually anything is a valid object under the General Welfare Clause.

Under the prohibition principle, the subject test is still used sometimes. Champion. Generally it is not required however. Wickard's substantial effect test allows any activity which in the aggregate substantially affects interstate commerce to be a valid subject matter.

Lopez tried to limit Congress' power by clarifying that Wickard required the activity to be economic, but listed three ways to get around it:

  1. Making the statute an essential part of a larger regulation of economic activity
  2. Showing some nexus to interstate commerce
    • Like requiring that some good come from out-of-state
  3. Develop a better legislative record showing some substantial effect on interstate commerce

Raich then loosened even the substantial effect however, saying that an actual effect need not be shown, but only a rational basis for thinking it might. This will basically never be questioned.

So, in summary: Congress must have a rational basis for finding that some economic activity in the aggregate substantially affects interstate commerce for the purpose of promoting the general welfare.

Dormant Commerce Clause
  1. Calculated to effect (not a pretext)
  2. Not prohibited
    1. Four categories for dormant commerce clause prohibition:
      1. Facial discrimination – strict scrutiny
        • Exceptions:
          1. Strict scrutiny
          2. Level playing field
          3. Public function
          4. Subsidy
          5. Market participant
          6. Congress approves state discrimination
          1. 21st Amendment (according to a minority of justices)
      2. Discriminatory purpose – strict scrutiny
      3. Discriminatory Effect

        A state or local statute with a discriminatory effect on out-of-state commerce is invalid if it is unduly burdensome, meaning the burden placed on interstate commerce outweighs the benefits to be gained. Southern Pacific.

      4. Burden on interstate commerce – balancing test (Pike)
    2. Other Constitutional prohibitions
    3. Federal statute
    4. State constitution
    5. Law of nature

Taxation of Interstate Commerce

The dormant commerce clause also limits the power of states to tax interstate commerce.

If there is facial discrimination or a discriminatory purpose, such taxes will be subject to strict scrutiny.

If there is a discriminatory effect or an incidental burden, the Complete Auto test will apply, looking at four factors:

  1. Substantial nexus between the activity and the state
  2. Fair apportionment
  3. Absence of discrimination against interstate commerce
  4. Fair relation to the state services