Posted by Ilya Somin: The Story of the Schechter Poultry Case: http://volokh.com/archives/archive_2008_11_30-2008_12_06.shtml#1228286081
Economist Steven Horwitz has[1] a fascinating post on the history behind [2]the Schechter Poultry case, the 1935 Supreme Court decision that struck down the National Industrial Recovery Act - the most extensive attempt at economic central planning in American history. As I explained in [3]this post, the NIRA established production quotas, price controls, and wage controls for nearly the entire nonagricultural economy, in effect establishing a government-enforced cartel for every industry. The NIRA and related New Deal statutes greatly increased unemployment and [4]may have prolonged the Depression by up to seven years. Unlike most of the other controversial Depression-era Supreme Court decisions, which split the justices along ideological lines, Schechter was a unanimous decision. Even liberal justices like Louis Brandeis recognized that Congress had exceeded its authority under Article I of the Constitution and voted to strike NIRA down. This much I already knew from [5]the research I did for my own work on constitutional change in the 1930s. What I did not realize until I read Horwitz's piece is that the Schechter brothers ran afoul of NIRA in large part because their butcher shops followed the Jewish laws of Kashrut. Some of the food preparation practices required by Jewish law violated NIRA regulations; ironically, Horwitz notes, the deviations from Kashrut imposed by the government reduced the quality of the Schechters' product and imposed additional health risks on their customers. As Horwitz also points out, the prosecution of the Schechters and the press coverage thereof had a significant anti-Semitic component. Anti-Semitism was, of course, common in pre-World War II America and was probably exacerbated by the Depression, when many blamed the economic crisis on the supposed machinations of Jewish industrialists and financiers. Horwitz writes that "[c]overage of the case . . . was highly tinged with the standard anti-Semitism of the time, especially because the Schechters were right out of Jewish central casting, being immigrants with their Eastern European cadences and traditional Jewish dress. It was the Jewish rubes of Brooklyn against the high powered WASP lawyers of the northeast corridor." Fortunately, it was the rubes who prevailed in the Supreme Court. In addition to exemplifying [6]the dangers of expanding government power in times of economic crisis, Schechter also illustrates how economic liberties and limits on government power protect unpopular minority groups. References 1. http://hnn.us/blogs/entries/57574.html 2. http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=295&invol=495 3. http://volokh.com/posts/1222450700.shtml 4. http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx 5. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=458700 6. http://volokh.com/posts/1222450700.shtml _______________________________________________ Volokh mailing list [email protected] http://lists.powerblogs.com/cgi-bin/mailman/listinfo/volokh
