by David J. Porter, J.D.
There is a widely held view that Congress has virtually unlimited power to legislate, especially concerning economic matters. Consider, for example, the passage of the controversial Patient Protection and Affordable Care Act two years ago. While Congress’ power to regulate the economy is not completely unbounded, it is very far-reaching indeed. However, it was not always so.
Under the Articles of Confederation, Congress was powerless to address conflicting commercial regulations imposed by the several states. To remedy that flaw, the enumerated powers given to Congress under the Constitution included the authority “[t]o regulate Commerce … among the several States.”
At the time the Constitution was ratified, “commerce” referred to trade—buying and selling products—but it did not include all economic activity, such as manufacturing, agriculture, and labor. In the ratification debates, there was little deliberation over the Commerce power because it was understood to be an insignificant threat to local or non-commercial affairs. James Madison emphasized that point in Federalist No. 45.
Early Congresses rarely invoked the Commerce power. The Supreme Court’s first opportunity to determine its scope did not arise until Gibbons v. Ogden (1824). In that case, the Court held that Congress may regulate interstate commerce, but not commerce that doesn’t extend to or affect other states.
Over the next century, the Court reiterated that Congress’ Commerce power did not include regulation of production in anticipation of trade. In these decisions, the Court emphasized the distinction between commerce and other types of economic activity that are not commerce: “Without agriculture, manufacturing, mining, etc., commerce could not exist, but this fact does not suffice to subject them to the control of Congress” (Newberry v. United States, 1921).