California Court Stunner: Something Fails the Rational Basis Test
Via Damon Root at Reason, Tim Sandefur at the Pacific Legal Foundation is right to hail this momentous event: any decision that strikes down economic regulation under the rational basis test is as rare as the proverbial black swan. As he lays out this case it is hard to think of anything sillier than this regulation. It looks as though it is just an effort to target Walgreens while leaving everyone else untouched. That has not stopped the Supreme Court from upholding similarly dumb legislation in the past, but perhaps this decision will encourage courts to look closely at similar legislation in the future.
At stake here is a really large issue. The system of free trade depends upon the rapid movement of goods and services throughout the economy. More outlets lead to better outcomes. But no one thinks that free trade should allow for the sale (or importation) of poisons or damaged goods. The hard question is how to keep the safety and health issues apart from the anticompetitive ones. That job is not impossible, and a willingness of courts to ratchet up the level of scrutiny would doubtless reveal dozens of politically motivated statutes that should be duly consigned to the dust heap. For those who do constitutional law, the epic decision in Lochner v. New York (1905) involved just this issue -- a ten-hour maximum hour statute that was in reality an anticompetitive measure masquerading as a health statute.
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May '10
Re: California Court Stunner: Something Fails the Rational Basis Test
I remember reading Lochner in Con Law and not only thinking that the decision made sense, but that all the Nebbia-inspired "fair trade" laws that followed it, and the universal trashing of Lochner by so many alleged scholars was one of the worst trends screwing up the republic ever since.
Why can''t adults (as opposed to 16 year old sailing girls) simply enter into non-coerced contracts without having interfering bureaucrats dictate what is "good" for us?
Re: California Court Stunner: Something Fails the Rational Basis Test
The only place, Richard, where irrationality can justify a decision is the legislature. For too long, the rational basis test has been used by courts to refuse to review economically-destructive legislation under the due process clause, even though they are more than happy to infer new rights of privacy out of the same clause. The more a law was the product of legislative gift-giving to favored interest groups, the more the courts would bend over backwards to uphold the law.
It is telling that this had to come about in a California state court. Federal courts are still bound by Supreme Court precedents applying the rational basis test to all economic regulation (the most notorious was a case where a state said optometrists and opthalmalogists only could make eyeglasses -- an obvious payoff to an interest group), but state courts, applying the state constitution, can provide broader rights than the federal Constitution.
Re: California Court Stunner: Something Fails the Rational Basis Test
One more comment. I've always thought that one way to begin the process of fighting back against the excessive government regulation of our country is for one state to adopt free market reforms and expand individual economic liberties. Its superior economic performance would persuade people and business to locate there and spur other states to compete. And if the Left believes its policies are better, they can take over a state and impose their favorite policies (although I think we have such a place, called California) and we can see which state does better. A marketplace for policy, as it were.
Re: California Court Stunner: Something Fails the Rational Basis Test
You are right to harp on the federalism issue, John. A state can give greater constitutional protection than the federal government. It just cannot give less. Greater than zero, or near zero, is no mean feat. The hard question is whether a California court will take the next step. In light of the precarious economic situation, these judges might find something nice to say about competition in the constitutional vein after all.