68 Am. U. L. Rev. 927 (2019)

* Foley & Lardner-Bascom Professor of Law, University of Wisconsin Law School.  Copyright © 2018 by David S. Schwartz.  I wish to thank numerous colleagues for providing feedback on drafts of this article:  Tonya Brito, Anuj Desai, Keith Findley, Mark Graber, Alexandra Huneeus, Mark Killenbeck, Heinz Klug, Gwendolyn Leachman, John Mikhail, Robert Mikos, Yaron Nili, Asifa Quraishi-Landes, Cristina Rodriguez, Christopher Schmidt, Miriam Seifter, Brad Snyder, Mitra Sharafi, and Robert Yablon.  In addition to his helpful comments, Richard Primus suggested the catchy part of the title.  I am grateful to the participants of two faculty workshops for their tough questions and incisive comments:  the University of Arizona, James E. Rogers College of Law, Faculty Workshop, in particular Andrew Coan (who invited me), David Marcus, Toni Massaro, and Carol Rose; and the University of Denver, Sturm College of Law, Faculty Workshop, in particular Rebecca Aviel (who invited me), Bernard Chao, Roberto Corrada, Sam Kamin, Nancy Leong, and Justin Marceau.

An underspecified doctrine of implied “reserved powers of the states” has been deployed through U.S. constitutional history to prevent the full application of McCulloch v. Maryland’s concept of implied powers to the enumerated powers—in particular, the Commerce Clause.  The primary rationales for these implied limitations on implied federal powers stem from two eighteenth and nineteenth century elements of American constitutionalism. First, the inability of pre-twentieth century judges to conceptualize a workable theory of concurrent federal and state power made it seem constitutionally necessary to limit the Commerce Clause and to refrain from applying the concept of implied powers to the Commerce Clause in order to preserve a substantial scope for state regulation.  Second, because slavery so obviously fed into interstate and international trade, a robust application of implied powers to the Commerce Clause could naturally lead to a congressional power to “interfere with” the institution of slavery within the states.  Antebellum judges and political leaders saw the implied limitation of such a power as an inescapable element of the constitutional bargain.

These twin supports of the implied limitation concept have been eliminated from American constitutional law, yet the concept persists, with potentially significant consequences.  In National Federation of Independent Business v. Sebelius, the 2012 Affordable Care Act case, for example, five Justices maintained that there is an implied limitation against regulating economic “inactivity.”  The justification offered for this is an abstract concept of federalism that is largely detached from the once powerful, but now defunct, principles of constitutional politics that sustained it.

JUSTICE BREYER:  So I’m focusing just on the Commerce Clause . . . [a]nd I look back into history, and I think if we look back into history, we see sometimes Congress can create commerce out of nothing.  That’s the national bank, which was created out of nothing to create other commerce out of nothing.  I look back into history, and I see it seems pretty clear that if there are substantial effects on interstate commerce, Congress can act . . . .

MR. CLEMENT:  Well, Justice Breyer, let me start at the beginning of your question with McCullochMcCullochwas not a commerce power case.1Transcript of Oral Argument at 62, 64, Dep’t of Health & Human Servs. v. Florida, 567 U.S. 519 (2012) (No. 11-398).

In exercising the authority conferred by [the Commerce Clause] of the Constitution, Congress is powerless to regulate anything which is not commerce . . . .

        —United States Supreme Court in Carter v Carter Coal Co.2298 U.S. 238, 297 (1936).


Much of American constitutional history is a 230-year debate about the scope of federal power to regulate interstate commerce.  According to the conventional understanding, the Supreme Court narrowly defined interstate commerce to mean trade—buying and selling in interstate markets—plus interstate commercial travel and shipping.  Then, starting in the year of our Constitution’s sesquicentennial, 1937, the Court shifted ground and reinterpreted interstate commerce to mean, essentially, the U.S. economy.3See NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 37 (1937).  This so-called “New Deal Settlement” was completed in 1942, in the Court’s famous Wickard v. Filburn4317 U.S. 111 (1942). decision, which redefined the commerce power by authorizing Congress to regulate intrastate activities that substantially affect interstate commerce.5Id. at 124–25.  Then, beginning with United States v. Lopez6514 U.S. 549 (1995). in 1995, the Rehnquist and Roberts Courts launched a “federalism revival” that clarified the “substantial effects test”—or “trim[med]” it “at its edges”7Egelhoff v. Egelhoff, 532 U.S. 141, 160 (2001) (Breyer, J., dissenting).—to refer to the regulation of economicmatters, which must be activitiesrather than (somewhat absurdly) “inactivities.”8Lopez514 U.S. at 558–59; see also Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519, 556–57 (2012).  Although the so-called “New Deal Settlement” and its broad interpretation of the commerce power remains largely intact, the five conservative Justices in National Federation of Independent Business v. Sebelius9567 U.S. 519 (2012).(NFIB) in 2012 seemed to turn the clock back to at least 1938, if not 1936, when ruling that free-riding in the national health care market was not reachable as interstate commerce regulation.10Id. at 588 (noting that the individual mandate cannot be upheld under the Commerce Clause); id. at 657 (Scalia, Kennedy, Thomas & Alito, JJ., dissenting).

That holding strangely ignored McCulloch v. Maryland,1117 U.S. (4 Wheat.) 316 (1819). the foundational case to all participants in federalism debates since the early 1900s.  Chief Justice Roberts, for example, purported to rely on McCullochin providing the decisive fifth vote for the proposition that requiring uninsured people to buy health insurance violated the limits on the commerce power.12NFIB, 567 U.S. at 560.  Yet McCulloch’s analysis of implied powers gives Congress broad authority to do things that are not definitionally authorized by the enumerated powers, so long as they are “conducive” or “plainly adapted” to the exercise of an enumerated power.  Indeed, less than a decade before NFIB, in Gonzales v. Raich,13545 U.S. 1 (2005). Justice Scalia made this very point:  pursuant to McCulloch, Congress can regulate things that are neither interstate nor commerce in order to make the regulation of an interstate market more effective.14Id. at 38–39 (Scalia, J., concurring in the judgment).  Scalia argued that criminalizing simple possession of marijuana was in that way a “necessary and proper” element of Congress’s nationwide prohibition of a market for marijuana.15Id. at 34–35.  None of the other Justices bought into this analysis in Raich, and even Scalia refused to recognize his own argument seven years later in NFIB.16Id. at 33.  See generally NFIB, 567 U.S. at 646–47 (Scalia, Kennedy, Thomas & Alito, JJ., dissenting) (failing to frame the Necessary and Proper Clause as an issue in the case).

These puzzling facts point to a larger mystery at the heart of American federalism.  If McCullochprovides the definitive understanding of the Necessary and Proper Clause, the application of its doctrine to the Commerce Clause should have produced a set of constitutional understandings dramatically different from those that were maintained by the Supreme Court for the first 150 years of the Republic, and those that in vestigial form re-emerged in NFIB. An implied power, according to the prevailing understanding of McCulloch, is a power to regulate things that are not in themselves within the definition of an enumerated power, but whose regulation would be useful to implementing that enumerated power.17A significant and growing literature argues that the federal government is recognized to have important powers that are neither enumerated nor means to carry out those that are.  See, e.g., Calvin H. Johnson, The Dubious Enumerated Power Doctrine, 22 Const. Comment. 25 (2006); John Mikhail, The Necessary and Proper Clauses, 102 Geo. L.J. 1045 (2014); Richard Primus, The Limits of Enumeration, 124 Yale L.J. 576 (2014) [hereinafter Primus, The Limits of Enumeration]; David S. Schwartz, A Question Perpetually Arising:  Implied Powers, Capable Federalism and the Limits of Enumerationism, 59 Ariz. L. Rev. 573 (2017) [hereinafter Schwartz, A Question Perpetually Arising].  Arguably, McCulloch is best read as supporting this idea.  See John Mikhail, McCulloch’s Strategic Ambiguity (forthcoming 2019) (on file with author).  That point, though important, is tangential to my argument here. The range of things that fall within the definition of a concept is akin to the logical entailments of that concept. It is much narrower than the range of things that support or sustain that concept in a practical way.  Implied powers partake of the latter relationship, having the much broader and looser relatedness suggested by Marshall’s terminology (“conducive,” “convenient,” “plainly adapted”).18McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316, 415, 421–22 (1819).

During the Antebellum Period, applying McCulloch to the Commerce Clause would have meant an implied power to build and regulate interstate roads and to regulate or even abolish slave labor.  In the post-Reconstruction era, implied commerce powers under McCullochshould have made clear that Congress had the power to regulate racially discriminatory intrastate economic transactions.  And in the Lochner/early New Deal period, an acknowledgement of implied commerce powers should have recognized Congress’s authority to regulate labor, manufacturing, mining, and agriculture. Yet all these claims of power were highly contested by constitutional interpreters and were blocked by the Supreme Court before 1937.

The Court’s stubborn refusal to apply McCulloch’s conception of implied powers to the Commerce Clause has largely escaped notice, and it arguably made a difference in the outcome of NFIB.  This Article argues that the Court’s refusal stems from two eighteenth and nineteenth century elements of American constitutional thought that were eliminated long ago.  One element was the inability of pre-twentieth century judges to conceptualize a broad and workable theory of concurrent federal and state power.  To the nineteenth-century legal mind, most federal and state powers were to some degree, mutually exclusive.  In a commercial nation, in which most human activities eventually channeled into the stream of commerce, it seemed constitutionally necessary to many jurists to limit the Commerce Clause and implied powers—and especially to refrain from applying the concept of implied powers to the Commerce Clause—in order to preserve a substantial scope for state regulation.

The other element was slavery.  The most salient factor limiting implied commerce powers in the Antebellum Period was the belief that states had to maintain control over the legality of slavery within their borders.  Because slavery was so obviously a commercial system that fed into interstate and international trade, a robust application of McCulloch’s doctrine of implied powers to the Commerce Clause would naturally lead to a congressional power to “interfere with” the institution of slavery within the states.  Mainstream constitutional interpreters viewed the implied limitation of such a power as an inescapable element of the constitutional bargain by antebellum judges and political leaders.19See infra Part IV.  Notwithstanding the Civil War and the Reconstruction amendments ending slavery and authorizing federal protection of freed slaves, the Court by the end of the nineteenth century, reverted to an implied limitation against federal control over race relations as it ratified southern states’ “home rule” and Jim Crow regimes.20See Plessy v. Ferguson, 163 U.S. 537, 551–52 (1896) (upholding racial segregation laws for public facilities under the separate but equal doctrine), overruled by Brown v. Bd. of Educ., 347 U.S. 483 (1954).

These twin normative justifications for implied limitations on implied commerce powers fed into a robust doctrine of reserved state powers.  Although mentioned in the Tenth Amendment, the idea of reserved sovereign powers of the states was itself an implication rather than an “enumeration” in our constitutional order, because its content is unspecified.  What powers are reserved to the states?  And what does “reserved” even mean in this context?  Nineteenth centuryjurisprudence developed the idea that the power to regulate a specific, identifiable set of things was reserved to the states, and those things were identifiable by their connection to slavery:  labor and the production of goods for trade (i.e., manufacturing, mining, and agriculture) made up the content of reserved powers.  The meaning of “reserved to the states” meant off limits to federal regulation, and in particular, immunity from federal implied commerce regulation.

By the end of the 1960s, however, both of these twin supports of the implied limitation on implied commerce powers ceased to exist in American constitutional law. Acceptance of concurrent, overlapping regulatory powers of federal and state governments, coordinated by preemption doctrine, had become the prevailing constitutional idea, as had a federal commerce power to regulate intrastate race relations.

The idea that “reserved state powers” could defeat an assertion of implied commerce powers was definitively rejected, as expressed in the Court’s famous New Deal statement in United States v. Darby Lumber Co.21312 U.S. 100 (1941).  There the Court said that the Tenth Amendment “states but a truism that all is retained which has not been surrendered.”22Id. at 124.  Under this conception, reserved state powers consist of whatever is left after application of federal preemption doctrine.  Yet, the concept of reserved state powers as something capable of defeating claims of implied commerce powers has made a partial comeback.  The LopezMorrisonNFIB line of cases stands in tension with Darby’s “truism” principle by contending, in essence, that there must be some matters that the federal government cannot regulate, and thus, by implication, that there must be some content to the reserved powers of the states after all.  In reaching this conclusion, the Rehnquist and Roberts Courts’ conservatives claimed to rely on constitutional pedigree: “the principle that ‘[t]he Constitution created a Fed