Today marks the 110th anniversary of the U.S. Supreme Court’s ruling in Lochner v. New York, a case that continues to generate controversy. For example, just last week a writer named Ryan Cooper on a website called “The Week” accused 2016 presidential candidate Rand Paul of being “a supporter of the Lochner doctrine.”
Joseph Lochner was a baker in New York City. In 1899 he was indicted for violating a New York law that made it a criminal offense to require an employee to work more than 60 hours a week. He was convicted of this economic crime, and the case ultimately reached the U.S. Supreme Court.
The New York law reflected the late 19th-century Progressive movement toward the welfare-state revolution that would ultimately occur in the 1930s.
Keep in mind that while there were exceptions — slavery being the big one — America was founded on the principles of economic liberty. That’s why for more than a century, Americans lived without income taxation, Social Security, Medicare, Medicaid, Obamacare, welfare, public (i.e., government) schooling, drug laws, and immigration controls and with very little economic regulation.
Keep in mind also that the Constitution was first and foremost a limitation on the powers of the federal government, not the powers of the state governments. If a power wasn’t enumerated, the federal government could not exercise it.
It was the different with the state governments. Under the Constitution, the state governments were “free” to do whatever they wanted, unless the Constitution expressly forbade them from exercising a particular power.
For example, the Constitution prohibited the states from making anything but gold and silver coins legal tender. It also prohibited the states from emitting “bills or credit,” the term used for fiat (paper) money.
So, under the Constitution the states could infringe on the liberties of people all they wanted unless expressly prohibited by the Constitution. However, that didn’t mean that people were without legal recourse when a state enacted a law that infringed on their freedom. In legal actions to declare such laws unconstitutional, people could look to their state constitutions in litigation.
Citing a 2008 law review article entitled “Individual Rights Under State Constitutions When the Fourteenth Amendment Was Ratified in 1868: What Rights Are Deeply Rooted in American History and Tradition?” by Steven G. Calabresi and Sarah Agudo, Wikipedia states that in 1868, when the Fourteenth Amendment was adopted, “27 out of 37 state constitutions had Lockean Provisos, which typically said, ‘All men are by nature free and independent, and have certain inalienable rights, among which are those of enjoying and defending life and liberty, acquiring and possessing property: and pursuing and obtaining safety and happiness.’”
The legal situation changed radically with the enactment of the 14th Amendment, an amendment that came in handy for advocates of economic liberty, especially when the Progressives were starting to make inroads for what ultimately would become the welfare-state revolution of the 1930s.
That’s what the New York Bakeshop Act was all about — using the power of the state to protect bakery employees from working more than 60 hours a week, even if they wanted to do so. It was defended as an act of extreme paternalism. In actuality, the law was designed to protect well-established bakeries from the competition of small, home-based bakeries.
Without the 14th Amendment, Lochner would never have prevailed. When he appealed his conviction, the New York courts sustained his criminal conviction.
Lochner, however, appealed his conviction to the U.S. Supreme Court. On April 17, 1905, the Court — in a 5-4 decision —struck down New York’s Bakeshop Act as violating the Constitution, specifically the 14th Amendment.
The Court’s reasoning was based on the due process clause — that no state was permitted to deprive a person of liberty without due process of law. Following previous decisions upholding the concept of “substantive due process,” the Court reasoned that people’s freedom was not subject to majority vote.
Moreover, freedom, the Court stated, entailed the right of people to enter into mutually beneficial economic transactions with others, a fundamental right known as “liberty of contract.”
Thus, with the Fourteenth Amendment, people whose rights and liberties were being suppressed at the state level now had two bites of the apple in their attempt to strike down oppressive state legislation: the provisions of their state constitutions and the provisions of the U.S. Constitution.
The four justices in the Lochner minority were not pleased. Justice Holmes wrote that the “Fourteenth Amendment doesn’t enact Mr. Herbert Spencer’s Social Static,” adding that “a constitution is not intended to embody a particular economic theory.
Holmes was alluding to the growing battle between economic libertarians, who were fighting to retain the principles of economic liberty, and economic statists, who were fighting to move America in the direction of socialism, interventionism, and paternalism.
But Holmes’ critique was misguided. The majority in Lochner wasn’t voting on which economic theory to adopt — i.e. an unhampered market economy or economic paternalism. It was simply defining what liberty meant, as part of interpreting the due process clause of the Fourteenth Amendment. The majority rightly analyzed that liberty necessarily encompasses the freedom to voluntarily contract with others and that a fundamental right such as liberty was immune from majority vote. Thus, the Court correctly held that the Constitution trumped what were considered the traditional “police powers” of the states.
Unfortunately, the Lochner decision would not end up standing. The statist tsunami was building. As America entered the 1920s and 1930s, there were four justices — Sutherland, van Devanter, Butler, and McReynolds — who did their best to hold back the welfare-state tide, especially by joining one or more other justices to declare much of President Franklin Roosevelt’s socialist and interventionist New Deal programs unconstitutional.
Ultimately, however, the statist tsunami ended up overwhelming judicial opposition within the Court, especially as Roosevelt began pressuring the Court and then packing it with his judicial cronies. In the 1937 case of West Coast Hotel v. Parrish, the Supreme Court made it clear that Lochner was effectively overruled and that the Court would never again declare an economic law, either at the federal level or state level, in violation of the Constitution.
By 1955, the welfare-state revolution was complete, as reflected by the following statement in a unanimous decision of the Supreme Court in Williamson v. Lee Optical of Oklahoma: “The day is gone when this Court uses the Due Process Clause of the Fourteenth Amendment to strike down state laws, regulatory of business and industrial conditions, because they may be unwise, improvident, or out of harmony with a particular school of thought.”