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PAGE TWO
Dissenting Opinion of Supreme Court
Invalidating Agricultural Legislation
WASHINGTON.—(#)—The text|
of the dissenting opinion on the |
AAA case read by Justice Stone |
and concurred in by Justices
Brandeis and Cardozo follows: 1
1 think the judgment should bel
reversed. g
The present stress of widely heldl
and strongly expressed difl’erenme@j
of opinion of the wisdom of Ih~fi
Agricultural Adjustment Act |
makes it important, in the interest‘
of clear thinking and sound result, |
to emphasize at the eoutset certain |
propositions which should have |
controlling influence in determin
ing the validity of the act. They
are: :
1. The power of courts to de-i
clare a statute unconstitutional is
subject to two guiding prlnclples!
of decision which ought never to|
fie absent from judicial conscious
ness. One is that the courtg are
,concernad only with the powor to
‘enact statutes, not with their wis
dom. The other is that while un
constitutional exercise of power by
the executive and legislative
‘branches -of -the government is
‘subject to judicial restraint, the
only check upon our exercise of
power is our own sense of self-|
restraint. For the removal of un~|
wise laws from the statute books
appeal lies not to the courts bt to
the ballot and to the processes of
demoeratic government,
2. The constitutional power of
congress to levy an excige tax
‘upon the processing of agricultu
ral products is not questioned. The
‘present levy is held invalid, not
for any want of power in congressl
to lay such a tax to defray ‘public
eéxpenditurcs, inecluding those for
the general welfare, but because
the use to which its proceeds are
put is disapproved.
. Power of Congress
"To Help Farmers
8. As the present depressed|
state of agriculture is nationwide
in its extent and effects, there is
no basis for saying that the ex
penditure of public money in aid
of farmers is not within the spe
cifically granted power of congress
to levy taxes to “provide for the
. . . general welfare.” The opin
jon of the court does not declare
otherwise. l
4. No question of a variable tax
fixed from time to time by fiat otl
the secretary of agriculture, or of
unauthorized delegation of legis-!
Jative power, is mnow presented.
The schedule of rates imposed by
the secretary in accordance with
the orignal command of congress
has since been specifically adopt
ed and confirmed by act of con
gress, which has declared that it
shall be the lawful tax. Act of|
August 24, 1935,—stat—. That is
the tax which the government now
- seeks to collect. Any defects there
may have heen in the manner of
laying the tax by the secretary
‘have now been removed by the ex
ercise of the power of congress to|
pass a curative statute validating
‘an intended, though defective tax,
United States vs. Heintzen and
v?,, 208 U. 8. 870; Graham and|
‘Foster vs. Goodcell, 282 U. 8.!
409; C. F. Milliken vs. United
jm'ftu. B 0 8. 15, The Agri-!
cultural Adjustment Act as thus
amended declares that none of ite |
provisions shall fail because oth
_ers are pronounced invalid. ‘
~ General Welfare I
~ Clause Reviewed
It is with these preliminary and'
hardly controverted matters in
mind that we should direct our at
" tention to the pivot on which the‘i
decision of the court is made to
turn. It is that a levly unques
tionably within the taxing power
of congress may be treated as in
valld because it is a gtep in a
plan to regulate agricultural pro
duction and is thus a forbidden
infringement of state power. The
levy is not any the less an exer
cise of taxing power because it is
_intended to defray an expenditure
for the general welfare rather
than for some other support of
government, Nor is the levy and
collection of the tax pointed to as
effecting the regulation. While all
- federal taxes inevitably have
some influence on the internal
economy of the states, it is not
contended that the levy of a pro
cessing tax upon manufacturers
uysing agricultural products as
raw material has any perceptible
regulatory effect upon either their
_production or manufacture. The
tax is unlike the penalties which
- were held invalid in the child la
bor tax case, 229 U. 8. 20, in Hih
Ve, Wallace; 269 U. B. 44, m
_ Linder vs. United States; 268 U.
8. 5, 17 and in United States vs.
' Constantine, decided December 11,
‘gl“’ pecause they were them
selves the instruments of regula
_tion by virtue of their coercive
‘&'& on matters left to; the con
’s “of the states. Here regulation,
:;,. there be, is accomplished
by the tax but by the method
{, which jts proceeds are expend-
Efl. and would aqually be accom
" plished by any like use of public
~ funds.
e The methods may. be simply
. gtated. Out of the available fund
. payments are made to such farm
_ ers as are willing to curtail their
- productive acreage, who in fact do
' 80 and who in advance have filed
__their written undertaking to do so
_ with the secretary of agriculture.
In saying that this method of
pending moneys is an invasion of
‘the reserved powers of the states,
~ the court does not assert that the
__expenditure of public funds to pro
. mote the general welfare is not a
~ subStantive power specifically
~ deleted to the national govern
&«*m as Hamilton and Story pro
" mounced it to be. It does not deny
fHat the expenditure of funds for
" #he -benefit of farmers and in ald
'of a program of curtailment of
fuetion of agricuitural pro
. and . thus of a supposedly
e
state power is mnevertheless in
fringed by the expenditure of the
proceeds of the tax to compensate
farmers for the curtailment of
their cotton acreage, Although the
farmer is placed under no legal
compulsion to reduce acreage, it
is said that the mere offer of com
pentation for so doing i 8 a spe
cies of economic coercion which
operates with the same legal force
and effet as though the curtail
ment were made mandatory by act
of congress. In any event it is
ingisted that even though not co
ercive the expenditure of public
funds to induce the recipients to
curtail production is itself an in
fringement of state power, since
the federal government cannot in
vade the domain of the states by
the “purchase” of performance of
acts which it has no power to com
pel.
Freedom of Action ‘
Is Allowed Farmers
Of the assertion that the pay
ments to farmers are coercive, lti
i 8 enough to say that no such con
tention is pressed by the taxpayer,
and no such consequences were to
be anticipated or appear to have
resulted from the administration
of the act. The suggestion of co-I
ercion finds no support in the rec-!
ord or im any data showing the
actual operation of the act, Threat!
of loss, not hope of gain; is the]
esgence of economic coerclon.l
Members of a long depressed m-i
dustry have undoubtedly been
tempted to curtail acreage by the|
hope of resulting better prlcesl
and by the proffered opportunity
to gbtain needed ready money. But
there is nothing to indicate that
those who accepted hbenefits were
‘lmpelled by fear of lower prices if
they did not accept, or that at any
stage in the operation of the plan
a farmer could say whether, apart‘
from the certainty of cash pay
ments at specified times, the a.d-,_J
lvantlxe would lie with curtail
ment of production plug compen
sation, rather than with the same
or increased acreage plus the ‘ex
pected rise in prices which actu
ally occurred. Although the Agri
cultural Adjustment Ac¢t was put
into effect in June, 1983, the offi
cial reports of the Department of
Agriculture show that 6,348,000
acres of productive cotton land, 14
percent of the total, did not par
ticipate- in the plan in 1934, and
that 2,790,000 acres, 6 percent of
the total, did not participate in
1985. Of the total number of farms
growing <cotton, estimated at 1,-
500,000, 88 percent in 1934 and 13
percent in 1935 did not participate.
It is significant that in the con
gressional hearings on the Dbill
that became the Bankhead act, 48
stat. 598, as amended by act of
June 20, 1934, 48 stat. 1184, which
imposes a tax of 60 percent on all
cotton produced “in excess of lim
its prescribed by the secretary of
agriculture, there was abundant
testimony that the restriction of
¢otton production attempted by
,the Agricultural Adjustment Act
|could not be secured without the
leoercive provisions of the Bank-
head act. See hearing before coni
mittee on agriculture, United
States senate, on 8. 1974, seventy
third ' congress, second sessjon;
hearing before committee on agri
culture, United States house of
representatives, on H. R. 8402,
seventy-third congress,, second
gession. The senate and house
committee so reported, senate re
port No. 283, seventy-third con
gress, second session, P. 3; house
report No. 867, seventy-third con
gress, second session, P. 8. The
report of the Department of Agri
culture on the administration of
the Agricultural Adjustment Act
(February 15, 1934, to December
31, 1934), P. 50, points out that
the Bankhead act was passed in
response to a strong sentiment in
favor of mandatory production
control “that would prevent non
co-operating farmers from increas
ing their own plantings in order
to capitalize upon the price ad
vances that had resulted from the
reductions made by contract sign
ers.” The presumption of consti
tutionality of a statute is not to
be overturned by an asertion of
its coercive effect which rests on
nothing more substantial than
groundless speculation.
Spending of Funds
Must Be Defined
It is upon the contention that
~state power is infringed by pur
chase regulation of agricultura!l
production that chief reliance Is
‘placed. It is insisted that, while
3the constitution gives to congress,
in specific and unambiguous terms,
the power to tax and spend, the
power is subject to limitations
which do not find their origin i-nl
‘any express provision of the con
stitution and to which other ex—;
pressly delegated powers are not !
subject. I
~ The constitution requires that
public funds shall be spent €or de- |
Iflned purposes, the prometion of |
'the general welfare, Their expen- |
’diture usually involves payment uni
terms which will insure use by the
[selectod recipients within the lim~‘
!its of the constitutional purpose. |
Expenditures would fail of theiri
!purpOSe and thus lose their consti
;tutional sanction if the terms of
payment were not snch that by |
!their influence on the action of the
!recipients the permitted end would
be attained. The power of con
gress to spend is inseparable from
persuasion to action over which
congress has no legislative con
trol. Congress may not command
that the science of agriculture be
taught in state universities. But if
jt would aid the teaching of that
!acim by grants to state institu
tions, it is appropriate, if not nec
essary, that the grant be on the
condition, incorporated in the
Morrill act, 12 stat. 503, 26 stat.
ey 3&%‘? gt Pirn
s ‘m;w‘e - “of It mu
‘the government to take and the
university to give @ contract that
'the grant would be so used- It
'makes no difference that there is
a promise to do an act which the
icondition is caleulated to induce.
Condition and promise are alike
valid since both are in further
ance of the national purpose for
which the money js appropriated.
Legitimate End
Urged By Justice
These effects upon individual
aetion, which are but incidents of
the authorized expenditure of gov
ernment money, are pronounced
to be themselves a limitation
upon the granted power, and so‘
the time-honored principle of ch-‘
stitutional interpretation that the
granted power includes all those!
which are nicident to it is re
versed. ‘“l.et the end be lexm-1
mate,” said the great chief jus-|
tice, “let it be within the scope of}
the constitution, and all means
which are incident to it is re
plainly adapted to that end, which
are not prohibited, but consist
with the letter and spirit of the
constitution, are congtitutional.”
McCulloch vs. Maryland 4 wheat,
316, 421. 'This cardinal gulde to
constitutional exposition must now
be rephrased so far as the spend
ing power of the federal govern
ment is concerned. Let the expen-l
diture be to promote the general
welfare, «till, if it is needful in OT-J
der to insure its usgq for the in
tended purpose to influence a.ny‘
action which congress canfiot com
mand because within the sphere
of state government, the expendi
ture is unconstitutional. And
taxes otherwise lawfully levieq are
likewigse unconstitutional if they
are appropriated to the expendi
ture whose incident is condemned.
Congress through the Interstate
Commerce Commission has set
aside intrastate railroad rates. It
has made and destroyed interstate
industries by raising or lowering
tariffs. These results are said to
be permissible because they are
incidents of the commerce, power
and power to levy duties on im
ports. See Minnesota rate cases,
£3O, U, 8. 852; Shreveport rate
cases, 234 U. S. 842; board of
trustees of the University of Illi
nois vs. United States, 289 U, S.
48, The only conclusion to be
drawn is that results become law
ful when they are incidents of
those powers but unlawful when
incident to the similarly granted
power to tax and spend.
Such Limitation
Is Contradictory
Such a limitation is contradic
tory and destructive of the power
to appropriate for the public wel
fare, and is incapable of practical
application. The spending power
of congress is in addition to the
legislative power and not subordi
nate to it. This independent grant
of the power of the purse, and its
very nature, involving in its exer
cite the duty to insure expendi
ture within the granted power,|
presupposes freedom of selection
PR, SN © ©1936, R. J. Beyuolds
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THE BANNER-HERALD, ATHENS, GEORGIA
among divers ends and aims, and
the capacity to impose such con
‘ditions as winl render the choice
effective. It is a contradiction in
‘terms to say that there is power
to spend for the national welfare,
while rejecting any power to im
pose conditions reasonably adapt
ed to the attainment of the endl
which alone would justify the ex-!
penditure. X
The limitation now sanctioned
must lead to absurd consequences.
The government may give seeds
to farmers, but may not condition
the gift upon their being planted
in places where they are most
needed or even planted at all, Thel
government may give money tol
the unemployed, but may not ask
that those who get it shall give
labor in return, or even use it to
support their families. It may give
money to sufferers from earth
quake, fire, tornado, pestilence or
flood, but may not impose condi
tions-health precautions designed|
to prevent the spread of disease, ori
induce the movement of population
to safer or more sanitary areas.l
All that, bhecause it is purchased |
regulation infringing state powers,
must be left for the states, who
are unable or unwilling to supply |
the necessary relief. The govern
ment may ¢pend its meney for vo
cational rehabilitation, 48 stat.
889, but it may not, with the con- |
sent of all concerned, supervise |
the process which it undertakes
to aid. It may spend its monéy
for the suppression of the bholl
weevil, but may not compensate
the farmers for suspending the
growth of cotton in the infected
areas. It may aid state reforesta
tion and forest fire prevention
agencies, 43 stat. 653, but may not
be permitted to supervise their
conduct. It may support rural
schools, 39. stat. 929, 45 stat. 115,
48 stat. 792, but may not condi
tion its grant by the requirement
that certain standards be main
tained. It may appropriate mon
eys to be expended by the Recon
struction Finance Corporation ‘“to
aid in financing agriculture, com
merce and industry,” and to facil
itate “the exportation of agricul
tural and other produects.” Do all
its activities collapse because, in
order to effect the permissible pur
‘pofe, in myriad ways the money
is pald out upon terms and condi
tlons which influence action of the
recipients within the states, which
‘congress cannot command? The
‘answer would seem plain. If the
lexpenditure is for a national pub
lic purpose, that purpose will not
he thwarted because payment is on
condition whicnh will advance that
purpose. The action which con
gress induces by payments of
money to promote the general wel
fare, but which it does not com-
mand or coerce, is but an incident
to a specifically granted power,
but a permissible means to a le
gitimate end. If appropriation in
aid of 2 program of curtailment of
agricultural production is consiitu
tional, and it is not denied that it
is, payment to farmers on condi
tion that they reduce their crop
acreage is constitutional. It is not
any the less s 0 because the far
mer at his own option promises to
fulfill the condition, i
Power of Purse
Is Great One
* That the governmental power of
the purse is a great one is not
now for the first time announced.
Every student of the history of
governmenc and economics is
aware of its magnitude and of its
existence in every civilized gov
ernment. Both were well under
stood by the framers of the con
stitution when they sanctioned the
grant of the spending power to
the federal government, -and both
were recognized by Hamilton and
Story, whose views of the spend
ing power as standing on a parity
with the other powers specifically
granted, have hitherto been gener
ally acepted.
The suggestion that it must now
ve curtailed by judieial fiat be-
'cause it may be abused by unwise
‘use hardly rises to the dignity of
argument. So may the judicial
power be abused. ‘*The power to
tax is the power to destroy,” but
we do not, for that reason, doubt
its existence, or hold that its effi
cacy is to be restricted by its inci
dental or collateral’ effects upon
the states. See Veazie Bank vs.
Fenno 8 wall. 553; MeCray vs.
United States, 195 United States
27; Compare Magnano Company
vs. Hamilton, 292 United States
40. The power to tax and spend is
not without constitutional re
straints. One restriction ig that
the purpose must be truly nat
ional. Another is that it may not
be used to coerce action left to
state control. Another is the con-
science and patriotism of con
gress and the executive., “It must
be remembegred that legislators are
the ultimate guardians of the lib
erties and welfare of the people in
guite ag great a degree as the
courts.” Justice Holmes, in Mis
souri, Kansas and Texas Railroad
Company vs. May, 194 United
States 267, 270.
Tortured Construction
Not to Be Justified ;
A tortured construction of the
constitution is not to be justified
by recourse to extreme examples of
reckless congressional spending
‘which might occur if courtg could
not prevent-—expenditures which,
éven if they could be thought to
effect any national purpose, would
be possible only by action of a
legislature lost to all sense of pub
lic responsibility. Such supposi
tions must leave unmoved any but
the mind accustomed to believe
‘that it is the business of courts to
sit in judgment on the wisdom of
llegislative action. Courts are not
‘the only agency of government
‘that must be assimed to have ca
%paclty to govern, Congress and
‘the courts both wunhappily may
falter or be mistaken in the per
}formance of their constitutional
Lduty. The interpreation of . our
kgrea.t charter of government which
lpmc-eeds; on any assumption that
Ithe responsibility for the preser
vation of our institutions is the
‘exe]usive concern of any one of
the three branches of government,
|m- that it alone c¢an save them
from destruction is far more like
ly, in the long run, “to obliterate
the constituent members” of “an
indestructible union of indestruct
ible states” than the frank recog
nitien that language, even of a
constitaion, may mean what it
says: That the power to tax and
spend includes the power to relieve
a nation-wide economic malad
justment by conditional gifts of
money.
Mr. Justice Brandeis and Mr
SENATE COMMITTEE
QESTIONS MORGAN
(Contmqaa ‘From Page One) !
D 1
fill the big room heard Chairman |
Nye of the munitions committeel
read also from a prepared state- l
ment,
“Our investigations have shown
us that prior to our entry into the[
World War, a great deal of the
sale, distribution, export, and also!
finanecing of arms and munitions|
of war was put into the hands ot‘
a few of our ,banking organiza
tions,” he taid. - l
He reminded that the committeeg
was empowered (o investigate the|
desirability of creating a govern- |
ment monopoly in arms and muni-'
tions manufacturing. i
“We agreed that we should do
all that was lawfully in our power
to help the allies win the war as
soon a€ possible,” Morgan con
tended. “That thought was the|
fundamental idea underlying
everything that we did from the
beginning of the struggle till the
Armistice in November, 1918.” :
Senator Vandenberg (R-Mich.)l
argued this comment was a “viola
tion” of the neutrality program‘
enunciated by President Wilson.
But Morgan’s view was unshaken!
—he repeated it. ’
The committée directed most of
its questioning at the head of thel
house of Morgan. Frequently,
however, Thomas W. Lamont, a
partner, inskrjected remarks. Once
he cautioned /Morgan not to talk
“without having the figures.”
Morgan said his company had
asgeis of $537,943,911 on Decem- ;
ber 31. i
* “What were your assets in 1914, |
at the beginning of thy war?” ]
Morgan began a repiy but T.a- |
mont stopped him by a gesture. |
“Of course I can’t remember)”
the witness then asserted. “We |
made no reports then.” : !
He promised to supply the infor- |
mation later. l
Lamont refused to let the ques- |
tioning proceeéd until he pointed |
out that “liabilities of the ('nm-i
pany are about $490,000,000.” |
BROWN SAYS U.S. IS
OBLIGATED TO PAY
FOR 1935 PROGRAM
(Continued From ¥Fage One) i
the American Cotton Co-opera
tive association: congress will no
doubt co-operate with administra
tion passing legislation necessary
to continue the program which
has doubled the cotton farmers’
income during the past two or
three vyears.
Charles C. Gilbert, secretary of |
the Tennessee Manufacturers’ as- |
sociation: It will remove one of |
the burdens of the manufacturers!
and will help reduce the cost of|
iiving for the average man, i
J. . Hoelton, Mississippi com-?
missioner of agriculture: I believe |
some plan will take the place of |
the AAA which has been, the savior |
of the cotton farmer. :
Governor Eugene Talmadge, of\
Georgia, critic of nearly all phases '
Justice Cardozo join in this opin-!
of the New Deal: I congratulate
the American people on having a
real Supreme Court.
Asks State Law
! From Representative John H.
| Kerr of Warrenton, N. C., came
| a suggestion that four flue
lcured tobacco growing states en
act identical legjslation to pre
lser\'e the c}u"' for that
crop, often ione of the
[r.'.nst el o il ‘the AAA.
L!nactz % legislation
!hy the )i senisige irginia, North
sCarolixéi?“' South Carolina and
‘(‘;m'.rgla—would circumvent the
Supreme Court's decision, said
!x;m-. who with Senator Smith of
! South Carolina, was auther of the
| flue rrogram. &
i Asked whether benefits and a
'processing tax should be included
iin any prepcsed state legislation,
the representative said farmers
would not request such aids if
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