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What New Deal legislation did the US Supreme Court declare unconstitutional?

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Federal New Deal Legislation

The Supreme Court found six of Roosevelt's eight major New Deal statutes unconstitutional, most often due to instances where Congress attempted to exercise the Interstate Commerce Clause in a manner not compatible with the Constitution.

In Panama Refining Co. v. Ryan, 293 US 388 (1935), (aka the Hot Oil Case) the Supreme Court invalidated a section of the National Industrial Recovery Act that regulated the sale of petroleum products between states and foreign entities. The Court held that Congress had overstepped its authority by delegating to the President powers not enumerated in the Constitution. The overturned section of the act prohibited the sale of petroleum in excess of undefined state quotas, and failed to set criteria for applicability of the statute.

In Railroad Retirement Board v. Alton Railway Co., 295 US 330 (1935), the Court invalidated the Railroad Pension Act of 1934 as violating several provisions of the constitution, including passage of ex post facto laws, and creating arbitrary rules and obligations in a manner prohibited by the Fifth Amendment Due Process Clause. The Railroad Pension Act made workers who had been employed prior to enactment of the statute eligible for pensions despite their not having contributed to the retirement funds. In addition, the law included former employees who had been fired for cause or who had worked for only a short duration. The Court also held that forcing pensions into a single, pooled fund was unfair to larger carriers who contributed more than smaller carriers, and was not a legitimate exercise of Congressional power under the Interstate Commerce Clause.

In Schechter Poultry Corp. v. US, 295 US 495 (1935), the Supreme Court found certain government-imposed regulations of the poultry industry, such as price- and wage-fixing, unconstitutional. The decision limited the government's power to act under the Interstate Commerce Clause, which it had applied to intrastate commerce, and invalidated a portion of the National Industrial Recovery Act of 1933, closing the National Recovery Administration (NRA). Many of the NRA policies, such as setting minimum wage and restricting work hours, were successfully reenacted under the National Labor Relations Act (aka Wagner Act) passed in July 1935.

In Louisville Joint Stock Land Bank v. Radford, 295 US 555 (1935), decided on the same day as Schechter, the Court struck down as unconstitutional a New Deal addition to the Bankruptcy Act, § 75, the Frazier-Lemke Farm Bankruptcy Act of 1934. Under the Frazier-Lemke provision, the federal government exercised eminent domain "in the public interest" by seizing farm property owned by the banks and turning it over to the farmers, in violation of the Fifth Amendment Takings Clause.

In United States v. Butler, 297 US 1 (1936), the Supreme Court held that the Agricultural Adjustment Act of 1933 was unconstitutional because the federal government imposed a tax on processors of farm products in order to fund a program that paid farmers not to grow crops. The decision restricted the government's ability to impose taxes for purposes other than raising revenue.

In Carter v. Carter Coal Co., 298 US 238 (1936), the Supreme Court overturned the Bituminous Cal Conservation Act of 1935 that attempted to regulate coal prices and wages by empowering local boards to set minimum prices for coal and to provide collective bargaining services for employees, whose wages were abysmally low. The Court ruled Congress had overstepped its authority under the Interstate Commerce Clause and abrogated the state's rights under the Tenth Amendment, by attempting to regulate industry during the production phase. The Court drew a distinction between manufacturing and distribution, affirming the right of the states to regulate production. (This ruling was reversed in NLRB v. Jones & Laughlin Steel Corp., 301 US 1 (1937))

State Minimum Wage Law

In Morehead v. New York Ex. Rel. Tipaldo, 298 US 587 (1936) the Supreme Court overturned a New York state law setting minimum wages and work hours for women and children, on the grounds that the law removed from workers the right to negotiate wages in exchange for work under the 14th Amendment Due Process Clause. (This ruling was reversed the following year in West Coast Hotel v. Parrish, 300 US 379 (1937) when the Court upheld Washington state's minimum wage law for women.)

Morehead was only one of several state minimum wage laws the Court overturned in 1935 and 1936. This trend reversed with West Coast Hotel v. Parish, (1937).

Most of the overturned federal legislation was resurrected in other forms, or with appropriate revisions soon after being invalidated. Between 1937 and 1943, President Roosevelt had an opportunity to appoint eight new justices to the Supreme Court, changing the basic tenor of the Court from conservative to progressive.

For more information on US v. Butler, (1936), and the Agricultural Adjustment Act, see Related Questions, below.

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