The Supreme Court Removes One Raisin Of The Smothering New Deal Legacy (Forbes.com) June 23, 2015Posted by daviddavenport in Newspaper Columns/Essays, Op/Eds.
Tags: Supreme Court
According to conventional U.S. history texts, Franklin Roosevelt’s New Deal ended sometime in the late 1930’s. Unfortunately, that is one more urban myth that needs to be exposed on Snopes.com. To our detriment, the New Deal is alive and well, still serving as the basic framework for U.S. domestic and economic policy. Indeed, Time magazine was prescient when it featured a cover shortly after Barack Obama was first elected in November, 2008, showing the new president with Roosevelt’s top hat and long cigarette holder, proclaiming “A New New Deal,” since Obama has continued to exercise the powers and extend the policies of the New Deal.
Finally the U.S. Supreme Court struck a blow against the antiquated New Deal agriculture policies this week, declaring on an 8-1 vote that the Raisin Administrative Committee, overseen by the U.S. Department of Agriculture, took a farmer’s raisins in violation of the 5th Amendment “takings” clause of the Constitution. Still, 80 years after the Depression, the government exercises the power to take crops from farmers in order to keep supplies down and prices up. So Fresno, California, farmer Marvin Horne must be paid in full for the crop that was taken from him as part of the government price support program. That’s one small raisin for farmer Horne, one big bag of raisins for rolling back the New Deal.
Unfortunately it is not clear how widely this may affect other agricultural subsidies since they do not all involve “taking” the crop. The USDA said it would review the Supreme Court ruling and “provide guidance based on the decision in the near future.” Even dissenting justice Sonia Sotomayor admitted that the raisin regulations may be “outdated and by some lights downright silly.” But this is the legal legacy we live with when emergency laws and regulations from a worldwide depression are not removed or even reviewed when the emergency is over.
Another such relic of the New Deal may be removed later this month when authority for the Export-Import Bank expires. It, too, was established by Executive Order of President Roosevelt to facilitate loans with the Soviet Union. Now it appears to be one more measure still on the books long after its purpose has vanished. Although its proponents argue it helps small businesses compete abroad, Boeing (not exactly a small business) received most of its money last year. Amazingly Hillary Clinton still wants to put up a fight for it, saying she wants an Export-Import Bank “on steroids.” Alas, the New Deal legacy will be part of campaign 2016.
Believe me, there is plenty more from the New Deal that needs to be reexamined. It was during that period that executive power began to grow dramatically, with Roosevelt saying the president needed war-like powers to deal with the economic emergency. Again the courts have been somewhat helpful here, with the Supreme Court ruling that the president cannot do end-runs around the Congress with “recess appointments,” and another federal court ruling recently that he does not have the power to change the immigration laws unilaterally. Likewise huge growth in the national debt was a gift from the New Deal that keeps on giving today.
It was also during the New Deal that the commerce and spending powers of the government under the Constitution grew dramatically. Again the Supreme Court has taken a little wind out of those sails, declaring that Obamacare was not justified under the Commerce Clause, even while upholding it under the taxing power, and also warning that Medicaid regulations bordered on an unconstitutional stretch of the spending clause. Of course Obamacare itself is a major addition to the New Deal legacy of Social Security.
President Obama recently made news when he said in an interview that “racism casts a long shadow and is still part of our DNA that’s passed on.” Unfortunately the same thing could be said about the New Deal—kudos to the Supreme Court for at least trimming its sails a bit.