Economic Liberties and the Constitution

Bernard H. Siegan

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351312509
• Edition: 2
• Topic: Economia
• Subtopic: Teoria economica

In this seminal work, Bernard Siegan traces the history of onstitutional protection for economic liberties in the United States. He argues that the law began to change with respect to economic liberties in the late 1930s. At that time, the Supreme Court abdicated much of its authority to protect property rights, and instead condoned the expansion of state power over private property.

Siegan brings the argument originally advanced in the.first edition completely up to date. He explores the moral position behind capitalism and discusses why former communist countries flirting with decentralization and a free market (for instance, China, Cambodia, Vietnam, and Laos) have become more progressive and prosperous as a result. He contrasts the benefits of a free, deregulated economy with the dangers of over-regulation and moves towards socialized welfare most specifically as happened during Franklin Roosevelt's presidency. Supporting his thesis with historical court cases, Siegan discusses the past and present status of economic liberties under the Constitution, clarifies constitutional interpretation and due process, and suggests ways of safeguarding economic liberties.

About the original edition, Doug Bandow of Reason noted, "Siegan has written a vitally important book that is sure to ignite an impassioned legal and philosophical debate. The reason the necessity for protecting economic liberty is no less than that guaranteeing political and civil liberty." Joseph Sobran of the National Review wrote, "Siegan...makes a powerful general case for economic liberty, on both historical and more strictly empirical grounds.... Siegan has done a brilliant piece of work, not only where it was badly needed, but where the need had hardly been recognized until he addressed it." And Edwin Meese remarked that, "This timely and important book shows how far we have drifted from protecting basic liberties that the Framers of the Constitution sought to secure. I recommend it highly." This new, completely revised edition of Economic Liberties and the Constitution will be essential reading for students of economics, history, public policy, law, and political science.

1

The Magna Carta

The history of freedom in the Anglo-Saxon nations began with the reign of William the Conqueror, Duke of Normandy, who defeated Harold, King of the Saxons, at Hastings in 1066. William brought with him new laws and administration; but most importantly, his attaining the English crown marked the beginning of the entrenchment of the feudal system in England.

With the death of the Conqueror, his eldest son, William Rufus, ascended the throne. History seems to have judged Rufus harshly: “In soul he was thoroughly, degradedly, unnaturally vicious … half atheist, with a strong vein of superstition.”¹ It was in part in response to such vileness that Rufus’s brother Henry, who assumed the throne on the latter’s death in 1101, issued the first Charter of Liberties.

Charter of Henry I

To anyone who would contend that Magna Carta was a mere tool for inconvenienced, threatened, and overtaxed barons in King John’s reign, the Charter of Henry I stands as an insuperable obstacle; for this first English “liberty document,” which predates Magna Carta by more than a century, evinces a strong tradition of legal restraint on executive-kingly action.²

The Charter’s first paragraph, like that of Magna Carta, pledges that the crown will not interfere with the inner workings of the English Church; and concludes by swearing to cast off all evil customs that were approved of in previous reigns.³

The second paragraph eliminates Rufus’s custom of charging high redemption rates to heirs of land prior to their obtaining seisin. Henry pledges that the redemption will now be done justly and legitimately (justa et legitima).The penultimate paragraph guarantees that the laws of Edward the Confessor (a previous monarch who founded Westminster Abbey), with lawful amendments, shall be maintained.⁴

The final paragraph is truly a precursor of the per legem terrae (law of the land) of Magna Carta c.39: Henry’s Charter states that the king will return any property taken after the death of Rufus, and if anyone should be found with property so taken, the victim might notify the king, who would correct it.⁵ It is not surprising then that the Curia Regis, from which inaugurates the English judicature, began during Henry’s reign.⁶

Charters of Stephen

But as strong as Henry’s reign was, the English monarchy was still susceptible to change and overthrow. When Henry died without a male heir, his nephew, Stephen of Blois, seized the throne. Though we might expect tyranny or anarchy to be the sole fruit of Stephen’s accession, one observes rather a further entrenching of written law and the securing of liberties, however truncated or myopic or parochial the protection may have been. All this can be seen in Stephen’s own Charter of 1136, in which the king swears to “utterly extirpate” all evil customs and exactions that have arisen in the realm; and to observe and to restore all good customs, laws and suits, with reservation for the traditional royal prerogative.⁷ In a later Charter, Stephen, impliedly acknowledging the ineffectiveness of his first promises, again swears to uphold all the privileges and good laws that his Uncle Henry granted or made, as well as those in the time of Edward the Confessor. Moreover, Stephen pledges to bind his heirs (de me et herebibus meis ipsiis) to allow his subjects the free, quiet, and full enjoyment of their rights. Another stone in the pathway to Magna Carta had been laid.

Charter of Henry II

Practically in extremis, Stephen reconciled with his cousin Henry of Anjou, the grandson of Henry I. Upon Stephen’s death the latter ascended the throne as Henry II. The reign of Henry II marks the first real assertion of Angevin (and now Plantagenet)⁸ power in England. No longer would the English king be a mere feudal overlord; now the crown would aggressively insert itself into the traditional prerogatives of the vassals of the crown. With Henry’s reign one witnesses the branching out of the Curia Regis into the triple form that it holds even today: Exchequer, Common Pleas, and King’s Bench. The crown during the reign of Henry Plantagenet and his sons, Richard and John, strongly and heavily relied upon greater taxation, exploitation of feudal tenurial incidents, and scutage (a fee paid in lieu of military service) for revenue creation, connected in one way or another with the Plantagenet aspirations on the Continent. With such a self-sure monarchy, discontent among the English magnates was bound to arise; and like his predecessors, Henry of Anjou sought to quiet dissent through a royal Charter.⁹

In the Charter Henry grants and confirms all concession, donations, privileges, and free customs that his grandfather Henry I had made or granted; Henry also abjures any and all evil customs that his grandfather had rooted out. Lastly, the king, like Stephen, promises to observe all the liberties and customs granted his subjects during the reign of Henry I, not to impede or restrict them, and to bind his heirs to the same promise.¹⁰

After this Charter, the references to the laws of Edward the Confessor cease, as Englishmen now had a more recent example (or instantiation) of the fundamental laws and liberties of the realm, as enunciated in Henry Plantagenet’s Charter. This Charter is crucial to understanding the barons’ complaint against King John, for that ruler’s furtherance of the Plantagenet policies of revenue increase and centralization of civil administration and justice seemed at odds with the laissez-faire assurances of Henry’s Charter.

Charter of John—Magna Carta of 1215

The document that became known as Magna Carta was consented to in 1215 by John, which identified him as king of England and Ireland. Commencing in 1205, King John and Pope Innocent III engaged in a struggle that led the Pope to excommunicate the king in 1209 and later in 1212 to declare him deposed of his kingdom, releasing his subjects from their allegiance. The king fought back, creating serious problems both for the English Church and clergy. However, upon Innocent’s agreement to withdraw his decrees of excommunication, John capitulated in 1213 and transferred all of his kingdom to the papacy. He then received it back as a feudatory of the Church of Rome, for which he agreed to pay a tribute of 1,000 marks sterling a year (seven hundred for England, and three hundred for Ireland). This arrangement was not unusual since five other European rulers previously became vassals of the Pope. In becoming a vassal of the Pope, John acquired papal support in his conflict with the English barons.

In late 1214, the English barons, burdened by King John’s serious violations of feudal rules and customs, revolted against him. They attacked his castles and seized London, the principal walled town of England, where its populace welcomed them and they occupied many of its parks and palaces. In the following year, a conference to obtain peace between the king and barons was arranged to be held on the plains of Runnymede near Windsor Castle. On June 15, 1215, to terminate the conflict, the king consented to a formal document containing sixty-three chapters that the barons submitted to him, which was originally known as the Charter of Liberties, or the articles of the Barons, and subsequently called the Great Charter or the Magna Carta.

The barons had revolted because John violated both the substantive and procedural rights of his constituents as established by his predecessors. He imposed at will new rules and penalties and punished without fair or proper process those he charged with wrongdoing. In the Magna Carta John promised, among other things, to return the properties he had seized and to remit the fines he had imposed in violation of existing rules and customs. He agreed that in the future a freeman would only be punished for violating existing rules and then only in proportion to his wrongdoing and would not otherwise be deprived of his liberties and properties.

In the words of Professor Charles McIlwain, “when King John substituted his will for this law, in proceeding by force against vassals whose wrong had not been judicially proved, civil war and the Great Charter were the result.”¹¹ The barons had many grievances against John. They suffered from gross maladministration in his government and his courts. He had exacted the surrender of castles and otherwise made exorbitant financial demands upon every class. He hanged prisoners he seized in battle and forced barons he suspected of treasonable inclinations to surrender their children to him as hostages. He seized lands of the clergy.¹²

In the Magna Carta, John agreed to undo the deprivations he had imposed retroactively and not to impose illegitimate ones in the future. Thus, in chapter 52, the king agreed that if anyone “has been dispossessed or removed by us, without the legal judgment of his peers, from his lands, castles, franchises, or from his right, we will immediately restore them to him.” Chapter 55 provided that all “fines, made with us unjustly or against the law of the land, and all amercements imposed unjustly and against the land of the land, shall be entirely remitted.” Chapter 56 mandated the same relief for lands or resources disseised or removed from any Welshman. Chapter 20 stated that a freeman, merchant, or villein shall not be amerced (fined) for either a slight or grave offense except in accordance with the degree of the offense; chapter 21 provided equivalent protection for earls and barons and chapter 22 for the clergy.¹³Chapter 12 recognized the concept of no taxation without representation: “No scutage or aid shall be imposed on our kingdom unless by common consent of our kingdom.” John’s most important commitments for the future were those contained in chapter 39, which is usually freely translated from the Latin as follows:

No freeman shall be arrested, or detained in prison, or deprived of his freehold, or in any way molested; and we [the king] will not set forth against him, nor send against him, unless by the lawful judgment of his peers or by the law of the land.

In this chapter, King John promises never again to commit the reprehensible acts that led the barons to revolt. He agreed that in the future he would not deprive freemen of their lives, liberties, or properties unless it was required by existing law and then only pursuant to fair and proper procedures. He thereby relinquished authority to execute retroactive laws or rules destroying or damaging freemen, as had previously been his practice. In relinquishing his power to deprive people of their property rights, he initiated a capitalist economy. Similar provisions were included in all subsequent issues of the Magna Carta.

Three other chapters are relevant to understand the background of the property protections in the U.S. Constitution. Chapter 61 authorized the barons to select twenty-five of their number to receive complaints about violations of the charter. When violations occurred, “these twenty-five barons together with the community of the whole realm, shall distress and injure us [referring to King John] in all ways possible … until redress has been obtained as they deem fit … and when redress has been obtained, they shall resume their old relations toward us as before.” This chapter can be considered as initiating the idea of checks and balances pursuant to which different governmental branches have authority to restrain each other for the purpose of upholding constitutional provisions. No provision similar to chapter 61 appears in any later versions of the Magna Carta.

Chapter 28 forbad the king’s constable or bailiff to “take corn, or other provisions from anyone without immediately tendering money therefor, unless he can have postponement thereof by permission on the seller,” possibly the basis for the Constitution’s takings clause. (Similar provisions permitting the king to acquire private property from nonconsenting owners by paying for it appear in later versions of the Magna Carta.)

In chapter 40, the king agreed as follows: “To no one will we sell, to no one will we refuse or delay, right or justice,” a precursor to the rule that the law will be applied equally to all, without seeking to benefit or harm selected persons.

One cannot be certain as to the exact meaning of a document written centuries ago and at a time of limited communications. Yet history discloses information that allows for a reasonable interpretation of the event. The barons had revolted because “the necessities of King John drove him to severities that had been unknown in the preceding century.”¹⁴ The Magna Carta was essentially an agreement between the king and the barons terminating their conflict pursuant to certain conditions. John acceded to the barons’ demands that their rights be recognized and confirmed in writing, and agreed to send a copy of the charter to each of the counties to be read to all freemen.

Much of the Charter requires the king to honor his obligations under the law of the land, which at the time was, as Professor Hogue explains, “principally land law, consisting of the rules, customs, and practices of those holding free tenures in a feudal society.”

Thus the common ...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Acknowledgments
• Introduction
• 1. The Magna Carta
• 2. Protection of Material Rights Prior to the Ratification of the Constitution
• 3. Framing a Constitution to Secure Liberty
• 4. Judicial Interpretations of Due Process Prior to the Framing of the Fourteenth Amendment
• 5. Substantive Due Process Decisions 1905-1937: Lochner v. New York (1905) Comment by Professor Christopher Wonnell West Coast Hotel Co. v. Parrish et al. (1937) Nebbia v. New York (1934) New State Ice Co. v. Liebmann (1932)
• 6. Destroying the Original Constitution
• 7. The New Deal Justices Reinterpret the Constitution
• 8. U.S. Supreme Court Refuses to Reverse Economic Liberties Decisions and Strikes Down Commerce Clause Decisions
• 9. Failures of Statism in the United States and its Collapse Elsewhere in the World
• 10. Economic Success: Germany (Come and Gone), Ireland, China, and Vietnam
• 11. Recent Decisions That Do Not Apply Due Process or Equal Protection to Protect Economic Liberties: Dolan v. City of Tigard (1994) BMW of North America, Inc. v. Gore (1996) Allied Structural Steel Co. v. Spannaus (1978) C & A Carbone, Inc. v. Town of Clarkstown (1994) 44 Liquormart, Inc. et al. v. Rhode Island et al. (1996)
• 12. Some Lower Courts Strike Down Economic Legislation, but Supreme Court Changes Uncertain
• Epilogue
• Index