The “dormant” commerce clause and the primacy of society
I occasioned upon Mark J. Perry’s Carpe Diem blog today, and read an interesting post called “The 10 Problems with Free Trade Among U.S. States.” As far as satire goes, it’s quite straightforward. However, it is quite effective at illustrating its point – namely, that restrictions on trade are fundamentally restrictions on people.
The national borders we use to demarcate those with favored status from those without are artifical. If we accept the proposition that all men are created equal, we cannot accept restraints on trade since they deprive equal people of the benefits of trade based solely on which side of a border they happen to be on. Here is Professor Perry:
The same arguments against free trade among nations should logically follow as arguments against free trade among American states, counties, cities, or individuals. That is, there is nothing really special or unique about an imaginary line called a national border that makes it economically different than an artificial line called a state border. The economic benefits of free trade have nothing to do with whether a buyer and seller are on the same side, or different sides, of imaginary lines called national, state or county borders.
The constitutional scholars among us perhaps remember a concept called the “dormant” commerce clause, which was theoretically derived from the Congress’s power to regulate commerce found in the U.S. Constitution. Despite how the commerce clause over the last 70 to 80 years has been twisted beyond all recognition into nothing more than an excuse to wield power, some remnants of the original ideological heft of the clause remain. These remnants are collectively called the “dormant” commerce clause.
Now, it is clear that the founding fathers saw no real problem with international trade restraints, as they gave to the government the power to lay and collect tariffs. However, they did recognize the absurdity of restrictions on trade as among the several states. In this case, there was an explicit recognition of the fact that a tariff laid by, say, South Carolina on products from Georgia would have an undoubtedly detrimental effect on the citizens of both states.
It is also an explicit recognition of the primacy of society over government. Because people require goods and services, the provision thereof is best provided for without interference of government. (Note the contrast with the progressive point of view, wherein goods and services should be “equitably distributed,” and the dormant commerce clause should have no significant effects as resources are employed and deployed by the federal government anyway.)
My question, also addressed by Professor Perry, is this. If a tariff laid on one U.S. state by another is bad for citizens of both states, why would that not extend to nations? Free trade has had its fits and starts, but it is the sensible policy when all is said and done.