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https://reason.com/2024/07/14/congress-can-regulate-virtually-anything/

Congress 'Can Regulate Virtually Anything'
How legislators learned to stop worrying about the constitutionality of
federal drug and gun laws by abusing the Commerce Clause
JACOB SULLUM | FROM THE AUGUST/SEPTEMBER 2024 ISSUE

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DRUGS | Illustration: Joanna Andreasson
(Illustration: Joanna Andreasson)
Two years after Harvard gave him the boot and three years before
Congress banned LSD, Timothy Leary set out on a road trip from
Millbrook, New York, in a rented station wagon. The 45-year-old
psychologist and psychedelic enthusiast was accompanied by his
girlfriend, Rosemary Woodruff, and his two teenaged children, Susan and
Jack. They had planned a month-long family vacation in Yucatan, Mexico,
after which Leary and Woodruff would stay behind to work on his newly commissioned autobiography. Leary and his companions arrived in Laredo,
Texas, on the evening of December 22, 1965, and crossed the
international bridge to Nuevo Laredo, Mexico.

At the customs station on the Mexican side of the bridge, Leary recalled
in his 1983 memoir Flashbacks, he learned that the visa he needed would
not be approved until the next day. That turned out to be the least of
his troubles.

"All the grass is out of the car, right?" Leary asked as he started
driving the station wagon back across the bridge. Jack had flushed his,
but Woodruff said she had been unable to retrieve her "silver box" of
pot from her bag because "there were two uniformed porters leaning
against the car." Since trying to toss the contraband off the side of
the bridge seemed inadvisable, Susan hid it in her clothing.

At the inspection point on the U.S. side, Leary explained that he
"didn't enter Mexico" and had nothing to declare. After a suspicious
customs agent picked up what looked like a cannabis seed from the car
floor near Leary's feet, the encounter escalated into searches of the
vehicle, the passengers, and their luggage. A "personal search" of Susan discovered what the U.S. Supreme Court would later describe as "a silver
snuff box containing semi-refined marihuana and three partially smoked marihuana cigarettes"—about half an ounce, all told.

Leary claimed ownership of the stash, which earned him a 30-year prison sentence. That astonishingly severe penalty was based on two federal
charges: transportation of illegally imported marijuana and failure to
pay a transfer tax on the contraband.

Those puzzling charges provide a window on the constitutionally dubious
origins of federal drug prohibition, which was smuggled into the U.S.
Code disguised as tax legislation. Federal gun control laws followed a
similar route, expanding along with conventional conceptions of
congressional power.

The Marihuana Tax Act's Double Bind
Leary said he had bought the pot in New York and did not know where it
was grown. But the government claimed that he had transported marijuana "knowing the same to have been imported or brought into the United
States contrary to law." How did Leary allegedly know that? At his March
1966 trial in Laredo, U.S. District Judge Ben Connally told the jurors
they could convict Leary based on either of two legal theories.

Since Leary admitted driving into Mexico with the marijuana and driving
back, Connally said, the jurors could conclude that he knew it was
"brought into the United States contrary to law." Alternatively, the
jurors could assume that the pot Leary obtained in New York was grown in
Mexico and that Leary knew that. The statute under which he was charged
said possession of marijuana was enough to establish knowledge of its
illegal importation unless "the defendant explains his possession to the satisfaction of the jury." That presumption, Leary argued on appeal,
violated his Fifth Amendment right to due process.

The other charge against Leary was even weirder. Under the Marihuana Tax
Act of 1937, unregistered recipients of cannabis were required to pay,
in advance, a transfer tax of $100 per ounce, which would entitle them
to a government-issued stamp indicating that the tax had been paid. To
complete that process, they had to fill out an "order form." The
Internal Revenue Service was required to keep copies of those forms and
make them available to state or local law enforcement agencies.

Those requirements put cannabis consumers in a double bind. If they
failed to pay the tax, they were committing a federal felony. But if
they paid the tax, they were revealing information that could be used to prosecute them under state law. That dilemma did not seem fair to Leary,
who argued that the tax demand violated the Fifth Amendment by requiring
him to incriminate himself.

In 1969, the Supreme Court unanimously agreed with Leary on both points.
The justices overturned his conviction for transporting illegally
imported marijuana, noting that it might have been based on an
unconstitutional presumption of knowledge. They also threw out the
Marihuana Tax Act conviction, saying it violated the Fifth Amendment's prohibition of compelled self-incrimination.

"The class of [marijuana] possessors who were both unregistered and
obliged to obtain an order form constituted a 'selective group
inherently suspect of criminal activities,'" Justice John Marshall
Harlan II wrote in the majority opinion. "Since compliance with the
transfer tax provisions would have required petitioner unmistakably to
identify himself as a member of this 'selective' and 'suspect' group, we
can only decide that, when read according to their terms, these
provisions created a 'real and appreciable' hazard of incrimination."

Congress responded to the Court's ruling in Leary v. United States with
the Controlled Substances Act of 1970, which among other things flatly prohibited marijuana possession. You might wonder why Congress did not
take that straightforward approach to begin with. Why emphasize the
possibly foreign provenance of marijuana or create a fanciful tax scheme
that notionally required pot dealers and their customers to keep the
government apprised of their illegal transactions?

Those indirect approaches were inspired by questions about the constitutionality of federal drug prohibition, questions that Congress
took seriously during the first few decades of the 20th century but had
stopped asking by the time it approved the Controlled Substances Act.
Those doubts explain why the Marihuana Tax Act—like the Harrison
Narcotics Tax Act of 1914, which in effect prohibited the nonmedical use
of opiates and cocaine—was framed as a revenue measure rather than a ban.

'The Guise of a Revenue Power'
Five years before the Harrison Act, Congress tried to prevent a specific
form of opiate consumption by banning the importation of opium for
smoking. When Congress considered the Smoking Opium Exclusion Act in
1909, Sen. Joseph W. Bailey (D–Texas) strenuously objected. The bill "is
upon its face an effort to suppress the practice of smoking opium," he
noted, "and that is clearly a police regulation." It was an "attempt by
the federal government through the custom houses to regulate and
suppress a bad habit among the people." But "the federal government has
no general police powers."

Bailey was not impressed by the argument that Congress was exercising
its power to impose and collect duties on imported goods. "The fact that
this is a part of tariff legislation could not alter the power of the
federal government with respect to it," he said. "In other words, if it
is a question that the federal government has the power to deal with, it
may deal with it in the way of a tax or in the way of regulation; but
the Government has no right to regulate through a tax a matter which it
has no right to regulate directly. To levy a tax for the purpose of
regulation under the guise of a revenue power is simply to abuse the
taxing power of the federal government."

Bailey allowed that the measure might be defended as an exercise of the
power to regulate international commerce, based on the premise that
opium for smoking, like "diseased meat," is not "in a merchantable
condition." But since the ban covered all smoked opium, regardless of
its quality, he was skeptical of that rationale, which he suspected was
a cover for the law's true aim.

"The nations of the world, which have no government like ours—no
divisions and subdivisions which must be respected—have called a
conference, and they want to regulate the health and morals of their
people," Bailey observed, alluding to the International Opium Commission
that was meeting in Shanghai as he spoke. But under the U.S.
Constitution, he said, "matters relating to the health and morals of the community are committed exclusively to the states, and in no wise are
subject to the control of the federal government."

When Sen. Henry Cabot Lodge (R–Mass.) defended the bill as "a measure of hygiene and protection," Bailey thought that comment proved his point.
"If it is a matter of health," he said, "it is not within the
jurisdiction of the federal government, and I must object to the
consideration of the bill."

Although Bailey's complaint failed to persuade his colleagues, it was
grounded in a widely shared understanding of congressional power. "In
the early twentieth century," University of Cincinnati historian Isaac
Campos notes in an online essay, "drug prohibitions (including alcohol [prohibition]) were understood as being a quite radical intrusion by the
state into the personal affairs of Americans. On the federal level such
laws were clearly understood to be unconstitutional. This is why the
federal laws were tax laws…rather than explicit prohibitions, and this
is why alcohol prohibition required a constitutional amendment."

Eventually, thanks to the Supreme Court, the power to "regulate commerce
with foreign nations" and "among the several states" would become an all-purpose excuse for pretty much anything Congress wanted to do. But
that transformation had barely begun in 1909, when even the legislators
who thought the opium bill was constitutional felt a need to dress it up
as a tariff measure.

Six years earlier, the Supreme Court had narrowly approved a federal ban
on interstate distribution of lottery tickets. Bailey did not think much
of that decision, joining the dissenters in viewing the law as an
exercise of the police power reserved to the states. Four years after
Congress approved the Smoking Opium Exclusion Act, the justices upheld
the Mann Act, which made it a felony to "knowingly transport" a woman or
girl "in interstate or foreign commerce" for "the purpose of
prostitution or debauchery, or for any other immoral purpose."

Both of those cases, however, involved interstate activity. The Supreme
Court had yet to read the Commerce Clause broadly enough to allow an
outright ban on drug-related conduct that never crossed state lines.

"There are no Federal laws on the growth or use of marijuana, the plant
being grown so easily that there is almost no interstate commerce in
it," The New York Times noted in 1931. Even Federal Bureau of Narcotics Commissioner Harry Anslinger, who at the time was urging states to ban marijuana cultivation, "said the [federal] government under the
Constitution cannot dictate what may be grown within individual States,"
as the Times put it. And when Anslinger later lobbied for a federal
marijuana law—the same law that tripped up Timothy Leary in 1965—it was based on the tax-power rationale that was popular at the time, despite
the objections of skeptics such as Bailey.

The Supreme Court had blessed that rationale in the 1928 case Nigro v.
United States, which involved a challenge to the Harrison Act. The
justices acknowledged that "merely calling an Act a taxing act can not
make it a legitimate exercise of taxing power" when "the words of the
act show clearly its real purpose is otherwise." But they rejected the
argument that the Harrison Act was a transparent cover for exercising
police powers that Congress was never granted, deeming the law's
official rationale and the "substantial revenue" it raised enough to
make it constitutional. That stretch, University of Cincinnati law
professor A. Christopher Bryant argued in a 2012 Nevada Law Journal
article, qualified as "the most disingenuous Supreme Court opinion, ever."

The Supreme Court's evolving understanding of the Commerce Clause would
later render such subterfuge obsolete. That evolution reached a new peak
in a 1942 case that involved a crop much more mundane than opium or
marijuana.

Too Much Wheat
In 1941, an Ohio farmer named Roscoe Filburn violated federal law by
growing too much wheat. Specifically, Filburn sowed 23 acres of winter
wheat, a dozen more acres than he had been allotted under the
Agricultural Adjustment Act of 1938. The penalty was 49 cents for each
of 239 unauthorized bushels, totaling $117.11 (about $2,500 in current dollars).

Filburn refused to pay. The recalcitrant farmer argued that Congress had exceeded its constitutional authority by telling him how much wheat he
could grow, especially for his own use on his own property. Since he
used the extra wheat to feed his family and his livestock, he said, it
never left his farm and therefore was never part of interstate commerce.

According to the Supreme Court, that didn't matter. Five years before,
the justices had narrowly upheld the National Labor Relations Act of
1935, ruling that the Commerce Clause reached economic activities, such
as hiring and firing practices, that were "intrastate in character when separately considered" if they had "such a close and substantial
relation to interstate commerce that their control is essential or
appropriate to protect that commerce from burdens and obstructions." The
Court extended that logic in the wheat case, Wickard v. Filburn.

When farmers grow wheat for their own consumption, the justices
reasoned, their conduct collectively has "a substantial influence" on
the interstate "price and market conditions" that Congress sought to
regulate. "Even if appellee's activity be local and though it may not be regarded as commerce," Justice Robert H. Jackson wrote for the unanimous
Court in 1942, "it may still, whatever its nature, be reached by
Congress if it exerts a substantial economic effect on interstate commerce."

That "substantial effects" test was a breathtakingly broad license for
federal action, and during the ensuing decades Congress repeatedly
invoked it to justify legislation that otherwise would have been
blatantly unconstitutional, including the Controlled Substances Act. "A
major portion of the traffic in controlled substances flows through
interstate and foreign commerce," Congress noted when it passed that
law. But even "incidents of the traffic which are not an integral part
of the interstate or foreign flow, such as manufacture, local
distribution, and possession," it said, "nonetheless have a substantial
and direct effect upon interstate commerce."

How so? "After manufacture, many controlled substances are transported
in interstate commerce," Congress said. It added that "controlled
substances distributed locally usually have been transported in
interstate commerce immediately before their distribution"; that
"controlled substances possessed [locally] commonly flow through
interstate commerce immediately prior to such possession"; that "local distribution and possession of controlled substances contribute to
swelling the interstate traffic in such substances"; that "substances manufactured and distributed intrastate cannot be differentiated from controlled substances manufactured and distributed interstate"; and that "federal control of the intrastate incidents of the traffic in
controlled substances is essential to the effective control of the
interstate incidents of such traffic."

Through the magic of "substantial effects," Congress transformed conduct
that was neither interstate nor commercial, including mere possession of illegal drugs, into federal crimes. It no longer had to pretend that it
was collecting taxes, and it no longer had to aver that people caught
with illegal drugs were knowingly transporting contraband that had been imported from another country.

A 2005 case involving medical marijuana vividly illustrated how far the super-elastic Commerce Clause invented by the Supreme Court could be
stretched. The plaintiffs were Angel Raich and Diane Monson, two
patients who used marijuana for symptom relief in compliance with
California law. Monson grew her own marijuana, while Raich relied on two caregivers who grew it for her. Raich and Monson argued that Congress
exceeded its power to regulate interstate commerce when it purported to
ban noncommercial production and possession of homegrown cannabis that
always remained within a single state.

"Our case law firmly establishes Congress' power to regulate purely
local activities that are part of an economic 'class of activities' that
have a substantial effect on interstate commerce," Justice John Paul
Stevens wrote for the majority in Gonzales v. Raich. He said Wickard "establishes that Congress can regulate purely intrastate activity that
is not itself 'commercial,' in that [the commodity] is not produced for
sale, if it concludes that failure to regulate that class of activity
would undercut the regulation of the interstate market in that commodity."

Like Roscoe Filburn, Raich and Monson "are cultivating, for home
consumption, a fungible commodity for which there is an established,
albeit illegal, interstate market," Stevens wrote. He perceived a
"likelihood" that marijuana produced for medical use in California would
be diverted to the interstate market, thereby evading the "closed
regulatory system" that the Controlled Substances Act had established.

"While the diversion of homegrown wheat tended to frustrate the federal interest in stabilizing prices by regulating the volume of commercial transactions in the interstate market, the diversion of homegrown
marijuana tends to frustrate the federal interest in eliminating
commercial transactions in the interstate market in their entirety,"
Stevens wrote. "In both cases, the regulation is squarely within
Congress' commerce power because production of the commodity meant for
home consumption, be it wheat or marijuana, has a substantial effect on
supply and demand in the national market for that commodity."

Justice Clarence Thomas was dismayed by the majority's reasoning. "Diane
Monson and Angel Raich use marijuana that has never been bought or sold,
that has never crossed state lines, and that has had no demonstrable
effect on the national market for marijuana," Thomas wrote in his
dissent. "If Congress can regulate this under the Commerce Clause, then
it can regulate virtually anything—and the Federal Government is no
longer one of limited and enumerated powers."

'We Will Tax the Machine Gun'
Federal gun control raised similar issues and inspired a similar
solution. The National Firearms Act of 1934, the first significant
attempt at federal gun regulation, was enacted as part of the Internal
Revenue Code. Like the early federal drug laws, it ostensibly was all
about raising money for the government and, toward that end, imposed registration and tax requirements, violation of which triggered criminal penalties.

The National Firearms Act was aimed at restricting access to weapons and accessories that Congress viewed as especially dangerous: machine guns, short-barreled rifles and shotguns, and "muffler[s] or silencer[s]."
Despite the bill's public safety motivation, it was framed as a revenue
measure rather than a crime-control law: an act "to provide for the
taxation of manufacturers, importers, and dealers in certain firearms
and machine guns," "to tax the sale or other disposal of such weapons,"
and, in service of those goals, "to restrict importation and regulate interstate transportation thereof."

The law required suppliers of the covered products to register with the
local "collector of internal revenue" and pay an annual occupational
tax. It also imposed a $200 tax on transfers, which was designed to be prohibitive, amounting to more than $4,600 in current dollars. To
facilitate collection of that tax, the National Firearms Act required
current owners to register with the Bureau of Internal Revenue and
report any subsequent transfers. The law made it a federal offense to
carry a covered weapon across state lines unless it was registered.

During House hearings on the bill in the spring of 1934, legislators and witnesses repeatedly invoked John Dillinger, the machine-gun-wielding
bank robber who would be killed by federal agents at Chicago's Biograph
Theater a few months later. Attorney General Homer S. Cummings also
expressed concern about the availability of bulletproof vests to
criminals such as Dillinger and wondered "if that could be made a matter
of prohibition under some theory that permits the federal government to
handle it."

But "of course," Cummings added, "we have no inherent police powers to
go into certain localities and deal with local crime. It is only when we
can reach those things under the interstate commerce provision, or under
the use of the mails, or by the power of taxation, that we can act."

Cummings explained how "the power of taxation" worked in this context:
"If we made a statute absolutely forbidding any human being to have a
machine gun, you might say there is some constitutional question
involved. But when you say, 'We will tax the machine gun,' and when you
say that the absence of a license showing payment of the tax has been
made indicates that a crime has been perpetrated, you are easily within
the law."

Four years later, Congress dispensed with the tax pretense. The Federal Firearms Act of 1938 explicitly sought to "regulate commerce in
firearms," and not just incidentally. It created a licensing system for
gun manufacturers, importers, and dealers, making it illegal to
"transport, ship, or receive any firearm or ammunition in interstate or
foreign commerce" without a federal license. The law also relied on the Commerce Clause in a more dubious way, making it illegal for anyone who
was "a fugitive from justice" or had been convicted of "a crime of
violence" to "receive any firearm or ammunition which has been shipped
or transported in interstate or foreign commerce." It treated possession
as "presumptive evidence" of receipt.

That provision, which Congress expanded in 1961 to cover nonviolent
crimes punishable by more than a year in prison, created a precedent for
the broad categories of "prohibited persons" established by the Gun
Control Act of 1968, which were further expanded by subsequent
legislation. The official aim of the 1968 law was to "provide for better control of the interstate traffic in firearms" and thereby "provide
support to Federal, State, and local law enforcement officials in their
fight against crime and violence."

The law retained the language about receiving a gun supplied through
interstate commerce, which on its face would not include a firearm that
never crossed state lines. But in 1986, Congress changed that provision
to cover possession (not just receipt) of a gun "in or affecting
commerce," further straining the already tenuous connection to an
enumerated power.

You might think an essentially meaningless phrase like that has no real
import. But according to federal courts, such boilerplate is
constitutionally crucial.

Magic Words
In the 1995 case United States v. Lopez, the Supreme Court ruled that
Congress had exceeded its power to regulate interstate commerce when it
passed the Gun-Free School Zones Act of 1990, which made it a felony to
possess a firearm within 1,000 feet of a school. "The Act neither
regulates a commercial activity nor contains a requirement that the
possession be connected in any way to interstate commerce," Chief
Justice William Rehnquist wrote in the majority opinion. "If we were to
accept the Government's arguments, we are hard pressed to posit any
activity by an individual that Congress is without power to regulate." Rehnquist also noted that the law "contains no jurisdictional element
which would ensure, through case-by-case inquiry, that the firearm
possession in question affects interstate commerce."

The following year, Congress responded by amending the law, adding
"findings" that described "crime involving drugs and guns" as "a
pervasive, nationwide problem." It averred that "crime at the local
level is exacerbated by the interstate movement of drugs, guns, and
criminal gangs"; that "firearms and ammunition move easily in interstate commerce and have been found in increasing numbers in and around
schools"; that "ordinary citizens and foreign visitors may fear to
travel to or through certain parts of the country due to concern about
violent crime and gun violence, and parents may decline to send their
children to school for the same reason"; and that "violent crime in
school zones has resulted in a decline in the quality of education,"
which "has an adverse impact" on interstate and foreign commerce.

The new version of the law also specified that its restrictions applied
only to "a firearm that has moved in or that otherwise affects
interstate or foreign commerce." As Congress saw it, however, even a gun
that is made and sold in the same state where it is possessed "affects interstate or foreign commerce," given the cumulative impact that
bringing guns into school zones has on "a pervasive, nationwide problem."

The U.S. Court of Appeals for the 8th Circuit thought Congress had cured
the problem identified by Rehnquist. Because the law "contains language
that ensures, on a case-by-case basis, that the firearm in question
affects interstate commerce," the appeals court ruled in 1999, it is "a constitutional exercise of Congress's Commerce Clause power." The U.S.
Court of Appeals for the 9th Circuit concurred in 2005, noting that "incorporating a jurisdictional element into the offense has
traditionally saved statutes from Commerce Clause challenges."

Congress, in short, initially forgot that it was supposed to be
regulating "interstate or foreign commerce." But after the Supreme Court reminded it, the invocation of that phrase was enough to fix the law,
even though nothing of substance had changed.

As a pretext for federal legislation, the Commerce Clause has proven
much more flexible than the Taxing Clause. The current understanding of
it has soothed the misgivings that members of Congress once felt about exceeding their constitutional constraints. They have learned to stop
worrying and love that balm.

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