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Jan 20, 2013

Courts and the Great Depression


When examining the historical events that took place in America between 1920 and the start of World War 2 in 1945, most examine the actions taken by the President and Congress. Few take any interest in examining the significant actions taken by the United States Supreme Court during that era. Most students learn about the stock market crash, the great depression, and FDR’s New Deal. However, teachers mentioning anything about landmark cases such as West Coast Hotel Co. v. Parrish (1937) or Schechter v. U.S. (1935) are uncommon. While the executive branch was busy creating agencies and submitting bills to congress, and while congress was busy creating laws, the U.S. Supreme Court was busy shifting towards “judicial liberalism”[1] while also issuing opinions that forever changed certain aspects of American life.
            A complete and thorough historical review of the U.S. Supreme court is not needed to understand the significance many of their rulings had on many Americans way of life at that time and for future Americans. Instead, a brief review starting around 1920 will suffice. The Supreme Court is at the top of the judicial branch of our system of government. Its primary role is to hear arguments of cases and interpret the U.S. Constitution as it applies to each case. The rulings handed down by the Supreme Court become the law of the land and apply to every court below it, both federal and state courts. Prior to the Judiciary act of 1925 the Supreme Court had no discretion in how many cases they would hear each year. Consequently, the court became backed up with so many cases that it took years for some cases to be heard. The Judiciary Act of 1925 gave the Supreme Court discretionary review authority, meaning that the court was allowed to review and vote on which cases it would hear and how many cases it would hear. [2]
            The Judiciary Act of 1925 was enacted during Chief Justice William Taft’s rein over the court and was just the start of a long list of changes coming to the court. He has historically been given credit for the modernization of the court in the physical aspects of it and the procedural aspects. The current Supreme Court building in Washington DC was constructed in the 1930’s in accordance with Taft's wishes.
            The laissez faire attitude towards economic regulations by the government was held by the Wilson, Harding, Coolidge, and Hoover administrations during the 1920’s and also applied to the Supreme Courts attitude towards interfering with businesses. Throughout the 1920’s, the court struck down nearly every case it felt placed a restriction on business or promoted unions.
            Arguably, one of the most significant rulings that affected citizens came in case of Adkins v. Children’s Hospital (1923). In that case, the Supreme Court ruled that “a minimum wage law for women violated the Due Process Clause of the Fifth Amendment because it abridged a citizen's right to freely contract labor.” It further went on to state “The law is especially "arbitrary," because it imposes uniform minimum wages on all women regardless of their individual needs or occupations.”[3]
            One of the most significant changes that took place between 1920 and 1945 was the introduction of the selective incorporation doctrine.[4] The 14th amendment of the U.S. Constitution was ratified in 1868 with the goal of protecting newly freed slaves from federal and state laws that sought to violate their new rights; while also guaranteeing them all the privileges and immunities enjoyed by other citizens of America.  The amendment is one of the most controversial in the constitution and as it pertains to this paper the important parts of it are:
Section 1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."
Section 5. The Congress shall have power to enforce, by appropriate legislation, the provisions of this article."
            Prior to the 1920’s the first ten amendments to the U.S. Constitution were thought only to apply to the federal arena of law and were not applicable to the states and their individual laws. Basically, the 1st amendments freedom of speech protection only protected the right of free federal speech (like protesting in front of the white house) and not a person’s speech at the state level (protesting in front of the governor’s office). During the 1920’s the court began to adapt the practice of selective incorporation; which meant that the court would over time selectively incorporate each of the first 10 amendments under the protection of the due process clause which did apply to the states. The first landmark case that did this was Gitlow v. New York (1925) which incorporated the first amendment’s protection of free speech under the due process clause and applied it to New York. [5]
            The significance of selective incorporation is essentially the idea that some rights are so fundamental to American culture that they must apply equally to everyone in every state. Also, there are some unenumerated rights not mentioned in the Constitution like the right to privacy that should also be protected as fundamental rights. The creation of the idea that there are fundamental rights during the 1920’s is the foundation upon which a great majority of cases heard before the Supreme Court today.
            Midway through the 1920’s the court had addressed and made landmark changes and rulings on the topics of free speech, unions, minimum wage laws, and had established that there are certain rights so fundamental to Americans that they should apply equally to everyone and every state.  The court isn’t finished though. It continues on to address some other big issues during the 1920’s.
            In the case of Carrol v. United States (1925)[6] the court ruled that vehicles may be searched and illegal items seized without a warrant. This ruling stemmed from the problems police was having combating prohibition. Also in the case of Olmstead v. United States (1928)[7] the court dove into the issue of legal wiretapping. In this case the court ruled that the evidence obtained from a wiretap that was placed in the basement of a suspected bootlegger was legal and did not violate any rights protected under the constitution.
            During this seemingly prosperous time the court was not without some rulings that would be considered inhumane by today’s standards. In Buck v. Bell (1927)[8] the court upheld a law that allowed for women to be sterilized if the state deemed that it would “prevent the nation from being swamped with incompetence.”
            By the time 1930 came around the economy was in a steep decline. President Hoover was desperately trying to find a way to stop the economic downfall. Also, in 1930 Chief Justice Taft died, thus leaving the appointment of his successor up to President Hoover. Chief Justice Charles Hughes was appointed to lead the Supreme Court through the depression. At the time of his appointment it was becoming clear that President Hoover was likely going to lose his bid for reelection. A large portion of America’s citizens had become unemployed and found themselves in dire need of help from someone. In 1932 Franklin Roosevelt was elected and immediately began working with congress. Together the President and Congress passed 15 bills in what came to be known as the first 100 days.  Most of the creations that came from the first 100 days placed regulations on institutions in hopes of providing citizens a sense of security. For example the Federal Deposit Insurance Corporation (FDIC) was emplaced to back up all deposits made into banks by civilians. It ensured civilians that even if their banks failed; their money would still be there for them.
            At that time the majority on the court was conservative and at first opposed most of FDRs new programs that regulated businesses. However, the courts strict adherence to the conservative economic principals became increasingly more liberal as the depression worsened. Before the court took a more liberal stance on economics it continued to apply its theory of “strict scrutiny”[9] when judging cases that dealt with economic regulations. For example in Panama Refining Co. v. Ryan (1935)[10] congress delegated power to the President to stop shipments of oil that would lead to an excess of a state’s oil quota. The authority of congress to delegate this power came from a provision of the National Industrial Recovery Act. However, the Supreme Court ruled this delegation of power found in the NIRA unconstitutional because it would give the president broad and unchecked powers that are not given to him by the U.S. Constitution.
            Similarly, A.L.A. Schechter Poultry Corp. v. United States (1935) challenged Section 3 of the NIRA that authorized the president to approve “codes of unfair competition.” The court held that the approval under section 3 was an unconstitutional delegation of legislative powers to the president because it allowed for the president to create standards and restrictions on trade and industrial activity. The creation of standards and restrictions on trade are legislative powers and cannot be delegated to the president.[11]
            The case of United States v. Butler (1935) addressed a part of the Agricultural Adjustment Act that placed a processing tax on agricultural goods. The tax from those goods would be given to farmers so long as they promised to reduce their production. The court held that congresses attempt to regulate the production of agricultural goods unconstitutional because the regulation and control of agriculture is a power left to the states. Also, the court stated that it was “a means to an unconstitutional end”[12] in violation of the 10th amendment. This ruling essentially dismantled a large portion of the AAA. Furthermore, the court continued to strike down numerous other parts of FDR’s New Deal.
            FDR became worried that if the court continued on its current path, it would strike down the Social Security Act and or the Securities Exchange Commission. Therefore, FDR and congress decided that it would be best to find a way to exert more control over the Supreme Court. FDR appointed 50 new federal judges and 6 new Supreme Court justices. This became known as FDRs court-packing plan. FDRs attempt at packing federal courts in hopes of ensuring the survival of New Deal programs was met with disapproval nearly everyone. In 1937, congress rejected his court-packing attempt, thus giving FDR a since of failure. However, soon after his plan failed, the Supreme Court began to change its attitude towards FDR and some of his New Deal programs. All in all, his court-packing plan wasn’t a complete failure.[13]
            The partial success of FDRs attempt to exert greater control over the court became evident in the case of West Coast Hotel Co. v. Parrish (1937). In this case the state of Washington created a minimum wage for female workers that was lower than the established state minimum wage for other workers.[14]
            The court held the following, “in a 5-to-4 decision, the Court held that the establishment of minimum wages for women was constitutionally legitimate. The Court noted that the Constitution did not speak of the freedom of contract and that liberty was subject to the restraints of due process. The Court also noted that employers and employees were not equally "free" in negotiating contracts, since employees often were constrained by practical and economic realities. This was found to be especially true in the case of women. This case explicitly overruled the Court's decision in Adkins v. Children's Hospital (1923).”[15]
            After 1937 the Supreme Court ruled in favor of every federal regulation law that the New Deal emplaced. The transformation of the courts view on New Deal legislation was so abrupt and quick that it became known as the “judicial revolution of 1937”[16] Consequently, the conservative members of the court began retiring or simply dying off and were replaced by liberal justices.
            Most people know about the 1920’s for its prosperity and the 1930’s for the depression, but now both of the time frames may also be known for the significant actions taken by the judicial branch of our government.


[1] Davis, Ronald L. "History of the Supreme Court." Educational Broadcasting Corporation. (accessed November 12, 2011.)

[2] "Landmark Judicial Legislation." Federal Judiciary. (accessed November 15, 2011).

[3] McBride, Alex. "Landmark Cases: Adkins v. Children's Hospital (1923)." Educational Broadcasting Corporation. Dec 2006. (accessed Nov 8, 2011).

[4] (Davis, 2011)
[5] "Law Library - American Law and Legal Information" Gitlow v. New York.  JRANK. (accessed November 15, 2011)

[6] (Davis, 2011)
[7] (Davis, 2011)

[8] (Davis, 2011)
[9] (Davis, 2011)

[10] (Davis, 2011)

[11] McBride, Alex. "Landmark Cases: Schechter v. U.S. (1935)." Educational Broadcasting Corporation. Dec 2006. (accessed Nov 16, 2011).

[12] "United States v. Butler," The Oyez Project at IIT Chicago-Kent College of Law, (accessed November 26, 2011)


[13] (Davis, 2011)

[14] West Coast Hotel Co. v. Parrish.” The Oyez Project at IIT Chicago-Kent College of Law. (accessed November 26, 2011)

[15] (West Coast, 2011)

[16] (Davis, 2011)

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