Why FDR’s court-packing plan “failed”

Among the most devastating long-term impacts that Donald Trump’s wretched presidency will have on the United States is its entrenchment of movement conservatism on the Supreme Court. That has me and others thinking about how a future progressive president and Congress can overcome a clash with a jerry-rigged conservative Court.

Congress has the power to rebalance the Court by adding new justices. That power was most infamously invoked by Franklin Roosevelt in 1937 in his doomed “court-packing” plan. Any effort to reinvigorate this vital legislative check on the Court’s power must learn from the missteps of Roosevelt’s effort.

The basic narrative of the rise and fall of Roosevelt’s court-packing plan comes from Jeff Shesol’s excellent Supreme Power: Franklin Roosevelt vs. the Supreme Court. Throughout his first term in office, Roosevelt watched helplessly as the Supreme Court invalidated massive cornerstones of his Great Depression relief agenda. A conservative majority deeply committed to protecting the freedom of contract and resistant to government efforts to regulate the economy struck down the National Industrial Recovery Act, the Agricultural Adjustment Act, regulations of the coal industry, and state minimum wage laws.

In February 1937, Roosevelt proposed legislation that would increase the size of the Court, allowing him to appoint one new justice for every current justice that failed to retire before reaching age 70. This would have allowed him to quickly appoint as many as six new justices.

On the heels of his landslide reelection, Roosevelt was politically dominant in early 1937. But by July, his Court reform plan was dead.

What happened? There are lessons to be learned from Roosevelt’s surprising legislative defeat:

Don’t spring Court reform on the public. Even though Roosevelt’s frustration with the Supreme Court was clear by the end of his first term, he didn’t campaign on adding seats to the Court. He feared that this would give the Republicans an issue to campaign on in opposition. Instead, he waited until after reelection to propose his Court plan. This caught the public off guard, and left them divided and confused. It also deprived the Court plan of a claim to a popular mandate, sapping it of political force and legitimacy in Congress.

Keep a variety of Court reform options on the table. Many different ideas for dealing with the conservative Court had percolated in Congress for years. In 1924, Progressive Party presidential candidate Sen. Robert LaFollette ran on a proposed constitutional amendment allowing Congress to overrule bad Supreme Court decisions. Others proposed constitutional amendments requiring a super-majority of the Supreme Court to overturn an act of Congress. Still others proposed to limit the Court’s jurisdiction or to strip its power of judicial review of acts of Congress entirely.

Rather than work with Congress to build on one of these preexisting fixes, Roosevelt imposed his own plan on legislators. And Roosevelt kept Congress entirely in the dark while he developed his Court plan. This backfired badly. There was no buy-in or investment from congressional leaders, leaving ample space for a rebellion to foment.

Level with the public about the real reasons we need Court reform. It was clear to everyone that Roosevelt’s clash with the Court was a philosophical one: an ideological Supreme Court was handcuffing Roosevelt’s ability to fix the economy. Yet the president opted to hide the true justification for his Court plan in his public messaging. Instead, he chose to publicly justify the Court plan on technocratic administrative grounds, arguing that the elderly Court could not keep up with its caseload, and needed more justices.

This too-cute obfuscation was a mistake. As Warner Gardner, the young administration lawyer tasked with writing the Court reform bill, observed, “ a constitutional confrontation that men could fight for” became a “trick,” an “effort to market deceit” thanks to FDR’s spurious justification. Solicitor General Robert Jackson also urged Roosevelt to emphasize the “fighting issues” of the Court’s ideological and extreme reasoning. Eventually, Roosevelt himself admitted that it had been a mistake not to lead with what he called the Court’s “real mischief.”

Court reform triggered underlying racial fears among Southern Democrats. Congressional Democrats held dominant majorities during Roosevelt’s presidency. But these majorities depended on the party’s wing of powerful Southern segregationists. Southern Democrats feared that a Court packed by Roosevelt’s justices would vote to end segregation.

While Western and Midwestern senators like Burton Wheeler led opposition to the Court plan, the Southerners were crucial to sustaining opposition. Opposition leaders planned to attach an anti-lynching poison pill amendment to court-packing bill to get Southern Democrats to join filibuster. This was a reminder to Southerners that a Roosevelt court could someday uphold a federal anti-lynching law.

All of this made the court-packing fight a “struggle for survival” for segregationists, and a “last stand for the Confederacy,” Shesol writes. The court-packing fight marked the beginning of the partisan realignment that gradually occurred over the ensuing four decades, as conservative Southern Democrats first split with the Democratic Party and eventually fully migrated to the Republican Party.

Because court-packing failed in 1937, it would be nearly another two decades before the Supreme Court began challenging segregation. In a parallel universe where Roosevelt succeeded, however, segregation could have been taken down much earlier.

Roosevelt’s court-packing plan actually succeeded. The court-packing bill ultimately had the air sucked out of it thanks to external events – and capitulations. Most important was the famous “switch in time” by swing justice Owen Roberts, who joined Chief Justice Charles Evan Hughes in siding with the Court’s three liberals to sustain Roosevelt’s New Deal legislation. First, in late March 1939, that configuration banded together to uphold state minimum wage legislation in West Coast Hotel v. Parrish, an about-face from just a year earlier when the Court struck down a similar law.

Next, in April, the same justices upheld the National Labor Relations Act in NLRB v. Jones & Laughlin Steel. The next month, the Court upheld FDR’s Social Security Act in a pair of cases. Those decisions have widely been seen as a strategic surrender by Roberts and Hughes, who “evolved” their views on economic legislation to stave off FDR’s attempt to overpower the Court.

The final nail in Court reform’s coffin came when Justice William Van Devanter, one of the Court’s conservatives, announced his retirement in June. This gave FDR his first chance to appoint a new justice since taking office.

Ultimately, pressure from FDR’s court-packing plan succeeded in failure. FDR achieved his desired ends despite his legislation crashing and burning. The court-packing plan sparked a constitutional revolution, where the Court rapidly reconsidered old dogma on the constitutionality of economic regulation. And thanks to a series of ensuing retirements, by 1940, Roosevelt had appointed five of the Court’s nine justices.

Roosevelt saw court-packing as necessary to make government work and to stave off tyranny. FDR warned that in 1937, “To stand still was to invite disaster.” The Great Depression had devastated millions of people. Tyrannical governments were taking hold abroad. Unless democracy in the United States could be made to work for the “forgotten man at the bottom,” he said, there would be a social and economic collapse, which could set the stage for a tyrant here, too. Government dysfunction caused by a conservative Supreme Court that refused to get with the times was not just a political foe, but an existential threat to American democracy.

We now see the type of demagogue that can win power when voters feel like government isn’t working for them. Progressives and institutionalists alike who wish to avoid another Trump must be sure that a Supreme Court unduly packed with conservatives does not stand in the way of making government responsive to the needs of the people and the crises of our time, whatever it takes.

 

How economic rights almost became part of the Constitution

President Franklin D. Roosevelt’s Second Bill of Rights has come back into vogue as a lodestar for the modern progressive imagination. And while FDR’s vision of robust social and economic rights has inspired progressive policymakers for generations, many have forgotten just how close the U.S. Supreme Court came to incorporating many of those rights into our existing Constitution.

Roosevelt proposed a Second Bill of Rights during his State of the Union address in 1944. He said that the country had come to recognize that economic security is a prerequisite for true individual freedom; that certain inalienable economic rights were necessary to buttress the inalienable political rights protected by the nation’s Founders.

FDR 2nd Bill

Roosevelt’s Second Bill of Rights included:

  • The right to a useful and remunerative job.
  • The right to earn enough to afford food, clothing, and recreation.
  • The right to be free from unfair competition and monopolization.
  • The right to housing.
  • The right to health care.
  • The right to security from the economic fears of old age, sickness, accident, and unemployment.
  • The right to a good education.

While these rights have long served as normative aspirations for various progressive movements, they never have been adopted into the Constitution to sit along side the actual Bill of Rights. Nor have they been otherwise transformed into enforceable legal rights, for the most part.

But there was a time when much of the Second Bill of Rights looked like it was on track to become part of our constitutional order. As Cass Sunstein explains in his book on the Second Bill, there was a brief period in the 1960s when the Supreme Court came very close to embracing much of FDR’s constitutional vision.

Much of the credit goes to Justice Robert Jackson, a close adviser to the New Deal before he was named to the Supreme Court. In the 1941 case Edwards v. California, a plaintiff challenged the constitutionality of a California law that criminalized bringing an indigent non-resident person into the state of California. The Supreme Court struck down the law as a barrier to interstate commerce.

In a concurring opinion, Justice Jackson argued that the law actually violated Edwards’ Fourteenth Amendment rights because it discriminated on the basis of his wealth status. “We should say now, and in no uncertain terms, that a man’s mere property status, without more, cannot be used by a state to test, qualify, or limit his rights as a citizen of the United States,” Jackson wrote. “The mere state of being without funds is a neutral fact—constitutionally an irrelevance, like race, creed, or color.”

Jackson considered laws that classify people by income level to be comparable to those that classify based on race, religion, or ethnicity. That’s a big deal, because those latter distinctions receive the highest degree of protection under the Constitution – what’s known as “strict scrutiny.” Laws that discriminate on those bases are almost invariably struck down by courts.

Jackson’s opinion was not the Court’s majority opinion, and his concurrence remained siloed for years. Until 1956, when a majority of the Court began to faintly echo Jackson’s reasoning in the criminal law context. In Griffin v. Illinois, the Court held that the Fourteenth Amendment’s Equal Protection Clause requires states to provide trial transcripts at no cost to indigent criminal defendants appealing their convictions. “In criminal trials a State can no more discriminate on account of poverty than on account of religion, race, or color,” the Court held.

Then, in the landmark 1963 case Gideon v. Wainwright, the Warren Court held that the Constitution requires the states to pay for legal assistance for indigent criminal defendants. That is, the Court held that the Constitution contains a positive right requiring the government to provide an affirmative benefit to people too poor to obtain it on their own.

The Court built on Gideon to expand the state’s affirmative obligation to the poor twice more. In Douglas v. California, the Court held that the Constitution also requires the state to provide defense counsel to indigent defendants appealing a criminal conviction. And in Boddie v. Connecticut, the Court held that the state has a similar affirmative obligation to ensure poor people have legal counsel in divorce proceedings.

In 1966, the Court held that discrimination against the poor was unconstitutional when it infringed upon the fundamental right to vote. In Harper v. Virginia Board of Elections, the Court struck down a $1.50 poll tax. The Court held that “Lines drawn on the basis of wealth or property, like those of race, are traditionally disfavored.” It cited Justice Jackson’s concurring opinion in Edwards, along with the Court’s criminal justice opinion in Griffin. “Notions of what constitutes equal treatment for purposes of the Equal Protection Clause,” the Court observed, “do change.”

The Court also seemed to find that the Constitution provides some level of protection from destitution. In Shapiro v. Thompson, Sunstein writes, “the Court seemed to come close to saying that the Constitution conferred a right to welfare benefits.” That case involved a California law that restricted welfare benefits from those who had lived in the state for less than one year.

The Court struck down the law on the grounds that it penalized people exercising their constitutional right to travel. It penalized travelers by denying them “welfare aid upon which may depend the ability of the families to obtain the very means to subsist — food, shelter, and other necessities of life,” the Court wrote, in apparent recognition of welfare’s importance to sheer human survival.

For similar reasons, the Court invalidated an Arizona law that denied new arrivals publicly funded non-emergency medical care until they had lived in the county for a full year. In Memorial Hospital v. Maricopa County, the Court applied its precedent in Shapiro and held that it is “clear that medical care is as much ‘a basic necessity of life’ to an indigent as welfare assistance.”

The high-water mark of the Court’s constitutional protections for the poor came in Goldberg v. Kelly. In that case, the Court held that the poor had property rights to welfare benefits, and such benefits could not be withdrawn without a due process hearing. “From its founding,” the Court held, “the Nation’s basic commitment has been to foster the dignity and wellbeing of all persons within its borders. We have come to recognize that forces not within the control of the poor contribute to their poverty.”

The Court held that welfare benefits were essential for the poor to realize full citizenship and participation in their communities. “Public assistance . . . is not mere charity, but a means to ‘promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity,’” the Court said, tying the provision of welfare to the very preamble of the Constitution.

Goldberg was decided in 1970. Yet the budding constellation of constitutional rights for the poor was already about to roll back. In 1968, Richard Nixon edged out Hubert Humphrey by about 500,000 votes to win the presidency. As luck would have it, Nixon was able to appoint four new Supreme Court justices in just five and a half years in office.

That was enough to halt the momentum toward broader social and economic rights under the Constitution. In Lindsay v. Normet, for example, the new, more conservative Supreme Court rejected a constitutional challenge against Oregon’s state eviction law, ruling that the Constitution provided no guarantee of decent housing. “[T]he Constitution does not provide judicial remedies for every social and economic ill,” the Court held. “We are unable to perceive in that document any constitutional guarantee of access to dwellings of a particular quality[.]”

The decisive turning point came in the 1973 case San Antonio v. Rodriguez. There, the Court rejected a constitutional challenge to grave funding disparities in Texas’s school financing system, where per-pupil expenditures were significantly higher in wealthy districts than poorer districts. The Court rejected the argument that this system discriminated against the poor, and rejected the notion that education is a fundamental right under the Constitution.

The Court was troubled by the unstoppable implications of calling education a fundamental right. “How, for instance,” the Court asked, “is education to be distinguished from the significant personal interests in the basics of decent food and shelter?”

A different Court might have followed that train of logic to decide that, yes indeed, all of the above are constitutionally-protected rights. Anyone who is deprived an education, housing, food, or shelter has been denied full citizenship and equal protection under the law.

But the lesson here is that elections have consequences. Had Humphrey eked out a half million more votes in a few key states in 1968, we could be living under a very different set of constitutional interpretations today. “It is not too speculative to suggest,” Sunstein writes, “that if Humphrey had been elected, aspects of the second bill would have been a solid part of the constitutional landscape.”

A Humphrey-inflected Court could have pieced together a mosaic of decisions like Edwards, Shapiro, and Goldberg to recognize a right to the “basic necessities of life”—like healthcare, a non-poverty income, decent housing, and sustenance—flowing from the Constitution’s guarantees of citizenship and equal protection, and its commitment to “foster the dignity and wellbeing of all persons within its borders.” Those decisions had all the makings of building blocks for something much bigger.

Instead, that unfinished constitutional project has largely languished in a jurisprudential no-man’s-land under nearly half a century of conservative dominance on the Supreme Court. But not entirely. In the 1982 case Plyler v. Doe, Justice William Brennan cobbled together a Supreme Court majority to hold that undocumented immigrant children have a right to public education. And in 1996, Justice Ruth Bader Ginsburg wrote for the Court in M.L.B. v. S.L.J. holding that the Constitution prevents states from denying an appeal from an order terminating a parent’s custody rights to parents too poor to pay a court fee.

These decisions are still out there. They have been neglected, but not reversed. Progressives should pick them up to be resurrected for another day, perhaps far in the future, when the Court is more amenable to expanding the constitutional rights of the poor. After all, conservatives and libertarians have long been at work rehabilitating a long-abandoned line of cases that would do the opposite, enhancing the rights and power of the wealthy and corporations.

Absent a major act of political hardball, the project of incorporating FDR’s Second Bill of Rights into constitutional law will likely remain frozen in time for years, if not decades. But old theories of constitutional law never truly fade away. They hibernate, waiting for the moral spirit of the times to swing their way.

Democratic hardball and the democracy agenda

Progressives are gradually coming to grips with the true scale of reform and reconstruction that the country must implement in the wake of Donald Trump’s presidency. At the Washington Monthly, editor-in-chief Paul Glastris writes:

“The fact that America now has only one party committed to small-d democracy changes everything. It’s no longer acceptable for Democrats to look at politics as a way to win the next election so as to jam through a bunch of their preferred policies before the Republicans inevitably take back power. They must instead see the purpose of politics as building sustained power for Democrats, period—but, unlike the other side, they must do this in part by strengthening the democratic process, not by undermining it.”

Indeed. Democrats are coalescing around an increasingly ambitious substantive platform as they ready for 2020 – Medicare for All, a federal jobs guarantee, free college, a $15 minimum wage, and other bold domestic policies. But they must also adopt an equally ambitious procedural platform to expand the franchised electorate and to level a political playing field badly tilted toward emboldening a modern Republican Party unfit to govern.

Call it a “democracy agenda” – an agenda grounded in finally granting full and equal voting rights and representation to U.S. citizens in the District of Columbia and Puerto Rico; in enacting a New Voting Rights Act that defends against the most pernicious voter suppression laws and affirmatively makes it easier to register to vote and cast a ballot; in giving the people a voice to add seats on the Supreme Court to rectify its current anti-democratic (small-d) lurch.

Those are reforms embraced by political scientist David Faris in It’s Time to Fight Dirty. Faris also proposes even more audacious reforms: breaking California into seven smaller states, and switching to proportional representation in the House.

Giving full political representation to D.C. and Puerto Rico would add four new Senate seats – which would likely be filled by Democrats. Protecting and supporting the right to vote would make it easier for more people to vote – which would likely work to Democrats’ favor. Rebalancing the Supreme Court would allow a Democratic president to tip a 5-4 conservative majority (*if Brett Kavanaugh wins confirmation) into a 6-5 liberal majority.

These might all smack of hardball entrenchment tactics. But the political effects are incidental to the primary impact, which is to expand the franchise and increase democratic representation in American government.

Moreover, if you believe in the moral urgency of the broader progressive substantive agenda, then these procedural steps are vital. Every year that progressives are locked out of a governing majority is a year that the American people are left without progressive reform to expand health care, environmental protection, higher wages, and other basic dignities. The current “back-and-forth” between Republican-dominated politics and Democratic-dominated politics, Faris writes in It’s Time to Fight Dirty, “inevitably lead[s] to worse and worse outcomes for America’s poor and middle classes, and invite[s] true planetary disaster.”

As Glastris points out, over the last 27 years, Democrats have only controlled both the White House and Congress at the same time in four of those years. Those are two fleeting blips at the beginning of the Clinton and Obama presidencies where it was possible to advance a progressive agenda. And progressives controlled the Supreme Court in neither of them.

Democrats can no longer afford to passively wait on the political pendulum to swing their way. The urgency of the country’s challenges, coupled with the radical nihilism of the GOP, demand something different.

In defending the case for Democratic reform of the Supreme Court, I argued:

“The Democratic president that follows Trump will not have a normal presidency. It will be one of reconstruction — of truth and reconciliation. To prove that America is truly better than this, Trump cannot be treated as politics as usual, no different than any other departing president. His presidency must be rendered a shameful aberration; a stain; a grotesque mistake that cannot happen again.”

The same principles apply to the broader democracy agenda above. Trump’s presidency has depended on a restricted electorate. We know, for example, that Wisconsin’s strict voter ID law discouraged voters and may have helped toss that state to Trump. And the absence of political representation for D.C. and Puerto Rico gave Trump an artificial slim Republican majority in the Senate, rather than a probable slim Democratic majority. That alone is the difference between a Senate that advances a right-wing agenda of plutocracy, healthcare repeal, and presidential rubber-stamping, and one that stands up to Trump and instates real accountability.

In the conclusion to It’s Time to Fight Dirty, Faris reminds us that “the undeniable truth is that we [are] already living through a monumental political crisis.” It’s one that progressives cannot afford to squander by letting real reform slip away. Our political crisis calls for a “Third Reconstruction,” as Faris puts it. Crucially, “[t]he most important thing progressives can do to help transform the United States into a more equal, just, and prosperous society,” Faris tells us, “is to win elections.”

To govern in 2021, progressives must rise to the occasion and realize that fundamental truth. Some times in American history call for hardnosed reconsiderations of our political system – how it has been perverted through inertia and deliberate mischief over the years; how it is amplifying select voices and muffling others. Call it hardball if you want. But this is one of those times.

Share the windfall

President Donald Trump and congressional Republicans gifted U.S. corporations a massive financial windfall last year.  The Tax Cut and Jobs Act of 2017 slashed the top tax rate on corporations from 34 percent to 21 percent, handing big businesses a pile of extra cash to spend as they saw fit.

Trump claimed that the tax cut would be “rocket fuel” for the American economy.  But that fuel has largely fizzled out before reaching workers’ pockets.  Real wages have barely budged over the last two years despite steadily declining unemployment.  Aside from a handful of one-off bonuses, the tax bill has had no noticeable effect on workers’ wages.

So where is the cash left over from the corporate tax cut going?  Increasingly, into the pockets and portfolios of executives and shareholders.  According to Politico:

Some of the biggest winners from President Donald Trump’s new tax law are corporate executives who have reaped gains as their companies buy back a record amount of stock, a practice that rewards shareholders by boosting the value of existing shares.

A POLITICO review of data disclosed in Securities and Exchange Commission filings shows the executives, who often receive most of their compensation in stock, have been profiting handsomely by selling shares since Trump signed the law on Dec. 22 and slashed corporate tax rates to 21 percent. That trend is likely to increase, as Wall Street analysts expect buyback activity to accelerate in the coming weeks.

Stock buybacks (which were illegal until 1982) are when corporations use their stockpiles of cash to repurchase their own stock.  This inflates the value of their stock, juicing the compensation of their executives, too.

This is great for the shareholder class, but does next to nothing for workers.  It’s a symptom of a larger trend where record-shattering corporate profitability increasingly fails to produce higher pay for workers.  More and more, the corporate bounty has been hoarded the benefit of executives and shareholders, with barely a trickle for employees.

How do we combat this?  Senators Cory Booker and Bob Casey have proposed a “Worker Dividend Act.”  Under their bill, corporations pursuing massive stock buybacks would have to share the wealth with their employees.  Here’s how it would work:

The total value of a company’s obligation would be calculated as the lesser between the total amount of that year’s stock buybacks and 50 percent of the company’s profits above $250 million. That total obligation would then be distributed equally to each of the company’s employees.

To see how this would play out, consider the example of Oracle, which announced it would repurchase $12 billion worth of its own shares.  That’s nearly 75 percent of its total earnings last year, which totaled over $16 billion.  (And that’s just about par for the course, as Sen. Booker notes: “[C]ompanies on the S&P 500 dedicated 91 percent of their total earnings to stock buybacks and corporate dividends, leaving just nine percent for things like raises for workers[.]”)

Under the Booker-Casey bill, Oracle would have owed its U.S. employees around $8 billion (the lesser of its $12 billion buyback and 50 percent of earnings over $250 million).  That pool of money would then be split equally among the company’s American employees.  Oracle had about 138,000 total employees around the world.  That means its U.S. employees would be in line to receive $60,000 or more each.

Ideas like the Worker Divided Act would help correct the absurd power imbalance between corporations and workers in the twenty-first century economy.  Workers deserve their fair share of the massive wealth sloshing around corporate coffers, not mere pennies on the dollar.  Only government policy can make sure they get it.