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Two black-letter-law, dead-certain things they tell you when you’re studying for the bar exam are: (1) If the court applies the “rational basis” standard, the plaintiff always loses; and (2) the 14th Amendment’s “privileges or immunities” clause is never the right answer. Now both these incontrovertible facts may be starting to change. Why? Because Americans’ constitutional right to economic liberty, long accorded little respect and even less jurisprudential status, is enjoying something of a renaissance. It may experience a complete rebirth if cases now working their way toward the U.S. Supreme Court receive the reception they warrant. A warm welcome from the justices for a Virginia winery and a Tennessee casket seller would vindicate the intent of the framers of both the original Constitution and the 14th Amendment, who wished to provide strong protections for freedom of enterprise. Over the past century, the courts have protected such important civil liberties as freedom of speech and freedom of religion from government meddlers, but have completely abdicated their responsibility to preserve one of the most essential freedoms: the right to earn an honest living in a legitimate business. LABOR’S LIBERTY The original Constitution protected economic liberty in a variety of ways. Crucial were the commerce clause, which bars states from erecting parochial trade barriers, and the “privileges and immunities” clause of Article II, Section 4, which requires states to extend to residents of other states the same opportunities their own citizens enjoy. Today, both provisions receive fairly robust judicial support. But unfortunately, neither of them protects citizens against deprivations of economic liberty by their own state governments. That failure manifested itself following the Civil War, when Southern states enacted “black codes” designed to maintain a servile labor force by denying former slaves freedom of contract and property ownership. Congress responded with the 14th Amendment, whose first clause guarantees the “privileges or immunities” of citizenship against state abuse. Despite the fact that it is the only protection in the 14th Amendment that on its face creates substantive guarantees, the privileges-or-immunities clause shortly after its ratification was drained of all meaning in the Slaughter-House Cases, 83 U.S. 36 (1873). In Slaughter-House, butchers who had been thrown out of their jobs as a result of bribery-induced legislation creating a slaughterhouse monopoly challenged the law as a violation of privileges or immunities. In an unusual (for the time) 5-4 decision, the Supreme Court essentially obliterated the clause by ruling that it was not intended to extend any substantive protections against the states. In dissent, Justice Stephen Field expressed his “profound regret” over the decision, “for by it the right of free labor, one of the most sacred and imprescriptable rights of man, is violated.” The Court’s disastrous opinion would have profound consequences. In 1896, when a test case challenging “separate but equal” streetcar laws headed to the high court, Slaughter-House deprived the plaintiffs of their strongest constitutional argument, freedom of contract. Instead, they were forced to rely on a more historically tenuous equal protection argument. The 8-1 loss in Plessy v. Ferguson, 163 U.S. 537 (1896), unleashed the Jim Crow era of state suppression of civil liberties. And protection of economic liberties was consigned to the due process and equal protection clauses, a difficult fit that ultimately was rejected in large part by liberals and conservatives alike. FROM WINE TO CASKETS Today, while protection of freedom of interstate commerce remains fairly strong, it faces a difficult test as states move to shield entrenched interests from the competition of Internet sales. The Supreme Court almost certainly will have to resolve an emerging conflict regarding direct interstate sale and shipment of wine to consumers. Nearly two dozen states prohibit such shipments — to the benefit of powerful wholesalers, who enjoy a monopoly over the distribution of alcohol in those states. So far, three courts have upheld the shipping bans under the states’ 21st Amendment power to regulate the sale of alcohol, while three other courts have struck them down under the commerce clause. On April 17, the U.S. District Court for the Southern District of New York heard motions for summary judgment in Swedenburg v. Kelly. In that case, a Virginia winery is challenging a shipping ban into the nation’s second-largest wine market under both the commerce clause and the privileges-and-immunities clause. Hopes are high that the Supreme Court will continue to vigorously protect interstate commerce by striking down such bans. Similar vigor has, unfortunately, been virtually nonexistent in the realm of intrastate commerce. That is true despite the proliferation of local regulatory bodies that can impede economic opportunities with little or no democratic accountability. For example, across America, approximately 10 percent of all jobs require permission from one or another local or state government in the form of a license. For many of these occupations, the rationale for licensing is nonexistent. Indeed, the aims of such economic regulation often bear little or no real relation to legitimate police powers. But the courts apply rational basis review to such regulations, which often means no meaningful review at all. Until now. The jurisprudential pendulum has swung so far in the direction of governmental deference that it may, finally, be swinging back. Applying a more rigorous version of rational basis review, at least four federal district courts have struck down restrictions on economic liberty under the due process and/or equal protection clauses: � Brown v. Barry, 710 F. Supp. 352 (D.D.C. 1989): The court struck down a Jim Crow-era law that barred shoeshine stands from the streets of the nation’s capital. � Santos v. City of Houston, 852 F. Supp. 601 (S.D. Tex. 1994): The court invalidated a law that prohibited “jitney” van transportation. � Cornwell v. Hamilton, 80 F. Supp. 2d 1101 (S.D. Cal. 1999): The court ruled unconstitutional the state’s application of cosmetology licensing laws to practitioners of African hairstyling. � Craigmiles v. Giles, 110 F. Supp. 2d 658 (E.D. Tenn. 2000): The court struck down a law prohibiting the direct sale of caskets and urns except through licensed funeral homes. The 6th U.S. Circuit Court of Appeals heard oral arguments in this case on April 24. All of these decisions reflect a healthy skepticism on the part of federal courts regarding regulations that restrict individuals’ livelihoods, as well as a determination to require government to demonstrate a connection between a legitimate objective and the means chosen to effectuate it. ON THE HORIZON Ultimately, however, economic liberty will remain seriously underprotected until the Supreme Court corrects its error in Slaughter-House and restores the privileges-or-immunities clause to its proper place in the constitutional constellation. A serious anomaly exists in the Court’s interpretation of the privileges-and-immunities clause of Article II and the privileges-or-immunities clause of the 14th Amendment. The former is rigorously applied to protect economic liberty, while the latter historically has never been the basis for invalidation of state legislation, no matter how pernicious. There are signs that the justices may be ready to redress that anomaly. In Saenz v. Roe, 526 U.S. 489 (1999), the Court struck down California’s two-tier system of welfare benefits, which discriminated against newcomers from other states. The Court cited the privileges-or-immunities clause as a basis for its decision. Justice Clarence Thomas, who dissented from the Saenz holding, nonetheless lauded the Court’s rediscovery of privileges or immunities, declaring that it holds promise for curing “the current disarray” of 14th Amendment jurisprudence. Indeed, such an enterprise is endorsed by a wide range of constitutional scholars, spanning the ideological divide. Many liberals, such as ACLU President Nadine Strossen, support overturning Slaughter-House because it would place on firmer jurisprudential ground the incorporation of the Bill of Rights against the states. Many conservatives and libertarians support the same outcome in order to restore economic liberty as a fundamental civil right. Each of the economic liberty cases handled by the Institute for Justice (we represent the plaintiffs in Swedenburg v. Kelly and Craigmiles v. Giles) raises the privileges-or-immunities issue so that we are ready to present it to the Supreme Court in an appropriate case — which may be coming soon. Some critics contend that a newly vigorous privileges-or-immunities clause would immerse the courts in judicial activism. But anyone who truly believes in heeding the original intent of the Constitution can see that view is mistaken. There are two types of judicial activism. The first creates new rights that do not exist in the Constitution. The second reads rights that are in the Constitution out of it. Correcting this latter activism is the duty of responsible judges — for if the courts do not protect our fundamental rights, who will? Millions of people have come to America because it is a shining example of the promise of individual enterprise. That beacon can continue to burn brightly only if the courts protect the economic liberty that is every American’s birthright. After nearly a century of relegation to jurisprudential perdition, economic liberty is due for a rebirth. Clint Bolick is vice president and national director of state chapters for the D.C.-based Institute for Justice. Bolick, who is based in the institute’s Phoenix office, represents the plaintiffs in Swedenburg v. Kelly .

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