« ForrigeFortsett »
use of the mail is but a peg whereon to hang prosecution; the real reason of the law is the wish to use a subpoena running over the whole country, and to overcome local parsimony which declines the expense of punishing the more elaborate methods of relieving gullible speculators of their property. One who cheats only those residing outside his own state is fairly safe from serious prosecution in that state; most citizens think the nation should pay the cost of such prosecutions. Congress has accepted the burden, hung it on the postal monopoly, and years of acquiescence have probably formed a national habit.
Indeed the habit of construing most benevolently the grant of power to establish post roads is well established. When the charter of a continental railroad is supportable thereunder, its application in physical extent can go no further, and acceptance in this sense has a real influence over the minds of men - including lawyers. When the power of legislative exclusion from postal privileges extends not only to matters commonly thought mala in se but to mala prohibita by Congress, what limit can be put to congressional prohibition?
Legislative (reflecting popular) feeling on the subject is well exemplified by the history of the first Cotton Futures Act. The plain object of that legislation was to prevent the sale of cotton for future delivery under any form of contract other than the one in effect prescribed by Congress; and to accomplish such result, the original bill denounced as “prohibita” and denied transmission by post to all written evidences of, or correspondence relating to, “futures” when the government form was not used.
This did not become statutory. Congress finally chose the taxing power, rather than the postal monopoly, as the constitutional support for the regulation of a business almost invariably intra
* In actual operation any fraud outside the common run of statutory larcenies, etc., may find its way into the federal courts, largely because the rules of trial for obtaining money under false pretenses do not apply. Emanuel v. United States, 196 Fed. 317, 322 (1912). E. 8., I have known two men who under pretense of finding capitalists who would finance inventions, took money from inventors, performed none of their promises, and never intended to. When looking for dupes in different towns in the same state, one of them forgot their mutual agreement to communicate only by telegraph, and wrote the other a letter which was duly received. This was enough to warrant a federal indictment, at the request of the county authorities.
5 In re Rapier, 143 U. S. 110 (1891); Rosen v. United States, 161 U. S. 29 (1895). 6 38 Stat. At L. 693.
state and not yet regarded as affected by a public use; but the suggestion then made, of regulation (as distinct from suppression) by exclusion from a beneficial governmental monopoly, is worthy of more thought 'than has yet been given it.
The whole history of lotteries, and legislation concerning them, is instructive. As soon as a working majority of the people thought them wrong, the writings, without which they could not live, became mala prohibita and as such excluded from the mails for the same legal reason as obscene literature. As soon as a like working majority comes to a similar conclusion as to tobacco, liquor," patent medicines, corsets, or any other advertised article, no reason is seen why restriction by postal exclusion cannot claim the conclusive support of the lottery cases; but assuredly that result will not be reached without new and intensive litigation.
Since the circulation of the notes of state banks was suppressed by prohibitive taxation,10 with the soothing judicial comment that the tax was not upon the obligation but on a particular use thereof (i. e., the only profitable one), the covert capabilities of the taxing power have been sufficiently apparent. The only reason for not hanging more statutes on that constitutional peg has been absence of popular demand.
One of the smallest and most instructive of past congressional efforts in this direction is the Smoking Opium Act. By this statute an enormous tax ($10 per pound) was laid upon opium prepared for the pipe, while for the ostensible purpose of facilitating collection of undesired income, the manufacture of the product was surrounded with most of the incidents of license, bond, inspection and return, long used in respect of alcoholic spirits. No such license was ever taken out; no such tax was ever collected
? The most accessible presentation of the case against the use of the postal monopoly as a weapon is Mr. James Coolidge Carter's argument in Rapier's case (143 V. S. 113). It is a pity that Bradley, J., did not live to answer it (p. 132). Mr. Carter's doctrine was utterly rejected; whether such rejection has left any logical limit to regulation by exclusion from the mails I venture to doubt.
8 See Horner v. United States, 147 U. S. 449, for history of lottery legislation.
9 Legislation of this sort against liquor advertising has often been proposed in Congress and is now there pending (and has become statutory since the text was written).
10 Veazie Bank v. Fenno, 8 Wall. (U. S.) 533 (1869). This act, like the charters of transcontinental railways, was contemporaneously regarded by laymen as produced by the necessities of war.
11 26 Stat. AT L. 620, $$ 36-40.
nor wanted. The purpose was prevention, and under the penal sections of the law many Chinamen were convicted for preparing their own poison. Quite naturally the courts nibbled at the statute (after citizens had been convicted) by insisting on regarding it as a revenue act,12 an almost jocular finding, which has not prevented fairly successful enforcement of its actual purpose.
The latest cognate statute, having for its real object suppression of habit-forming drug sales (the Harrison Act),13 proceeds along newer and more delicate lines. The tax is nominal ($1 for registration), but the penalties for selling without registration are severe, and one who registers and sells without a physician's prescription is guilty of crime against the United States, while such criminal will (in many of the states) also run counter to local laws of great stringency, with the national agents furnishing the evidence and the United States paying their salaries and expenses.14 This last is a very modern development.
Oleomargarine in its earlier days encountered national treatment differing in degree only from that accorded smoking opium. McCray v. United States 15 was the result - a decision wherein the court used language inconsistent with any subsequent effort to go behind the declared purpose of any act when that avowed or ostensible purpose is constitutional taxation. Taxation in some form can nearly always be justified; rarely is a purpose to transfer money's worth from one person to another apparent on the face of the bill; then of course “it is none the less a robbery because it is done under the forms of law and is called taxation." 16
From prohibitive taxation of a new, obnoxious, or unpopular thing to classification as a basis for graduated or selective taxation is a step that opens great possibilities of legislation and litigation. This method of covert regulation of business finds a most interesting illustration in the present Cotton Futures Act.17
12 Shelley v. United States, 198 Fed. 88 (1912); Seidler v. United States, 228 Fed. 336 (1915).
13 38 Stat. At L. 785.
14 This statute has been considered in Wilson v. United States, 229 Fed. 344 (1916), which decision (and others similar) are undoubtedly overruled by U. S. v. Jin Fuey Moy, 241 U. S. 394, a ruling suggestive of the attacks to come upon legislation of the sort under consideration.
15 195 U. S. 27 (1903).
Stat. At L. 476.
This statute in effect divides all dealings in the staple made on an Exchange and for future delivery into two classes: those in which the government form of contract (created by the act itself) is used, and those in which it is not. On the privilege of dealing under the approved contract, no tax is laid; on that of dealing in any other way, an excise of crushing weight is imposed.
Classification for benefits or burdens, and taxation by selection, are familiar enough in legislation and decisions; but it seems a novel use of the process for Congress to make out of the whole cloth a new method of transacting an old business and then put all the old methods out of existence by a tax.
Most businesses and all recognized professions could be regulated along analogous lines, and the field thus simply and ingeniously opened for national control will surely be explored by legislators and lawyers far more thoroughly than in the past. Indeed this particular plan of campaign is in the language of patents) “thought to be broadly new.”
The restraint with which the commerce clause has been expounded for over a century is perhaps the most remarkable example of a certain continuity of thought in the Supreme Court persisting through generations of men and politics. No one has finally indicated its limits, perhaps because all felt that vision was as through a glass darkly. But in the past the questions presented for solution have for the most part called for definitions of commerce, or delimitation of its often shadowy boundaries. Cautiously worded statements have resulted, almost always capable of expansion without contradiction, when circumstances altered cases.
The very near future will call upon the profession to deal with increasing regulation of output or production, sheltered behind the proposition, unanswerable in itself, that what is produced in one state cannot get into another for gainful purposes without forming part of the interstate commerce of the nation.
The Pure Food Law 18 is in practice an excellent sample of what may be called habit-forming statutes. It prohibits, under penalties rising in severity with repetition of offenses, the carriage in interstate commerce of many things -- some dangerous, some disgusting, more unsanitary, a smaller proportion mere advertisers'
34 Stat. AT L. 768.
catchpennies, but all calculated to annoy the judicious when their innate untruthfulness is exposed.
In the constitutionality of this statute there has been a general acquiescence; except in the "blended whisky” matter 19 there has hardly been serious contest over its provisions. For most makers of food and drug products the effective implement of discipline has not been so much actual fine or imprisonment as the publication in journals or bulletins of wide circulation of the names and offenses of those successfully (and often unsuccessfully) proceeded against. This publicity lends quite a sharp edge to the statute by spoiling business. In practice this act regulates manufacture, for few producers are so local that an agent provocateur cannot get his order filled across the state line.20
The recently passed Grain Standards Act 21 seems to take another step forward. The main object of the Pure Food Law was to make men tell the truth about what they already had for sale, under penalty of forbidding interstate commerce in their falsehoods; but the Grain Act standardizes a method of telling the truth by creating a national inspection service, classifying and describing wheat, etc., and then forbidding the interstate transference of grain not so classified. And to this scheme for not only regulating commerce but regulating that which is to enter into commerce, is added the Warehouse Act,22 which is probably intended to make it easier to store and deal in governmentally classified grain than in other and similar products of the soil not seeking national classification. The Child Labor Bill,23 proceeding along analogous lines, renders penal the interstate transportation of anything toward the production of which (under certain circumstances) minors under sixteen have contributed labor.
The one thing common to all this regulation of behavior, pro
19 Gwinn, FOOD AND Drugs Act (Government Printing Office, 1914), 818 et seq.
20 Of the practical working of the statute, Brina v. United States, 179 Fed. 373 (1910), and Von Bremen v. United States, 192 Fed. 904 (1912), are fair illustrations, the first of ease in reaching a small local dealer who commonly sold, and in the poorer quarters of New York City only, cottonseed oil as “Salad Oil,” by implication olive oil. The second case shows the difficulty of similarly proceeding against a dealer who had behind him the ably represented producers of cottonseed oil. Yet upon the whole the regulatory object of this act has largely succeeded, apparently to popular satisfaction.
39 STAT. AT L. 482.
Stat. At L. 675.