Supreme Court Cases: Great Depression/New Deal

Jay Near was the editor of a newspaper in Minneapolis, Minnesota, called The Saturday Press in which he often displayed his anti-Semitic, anti-African American, anti-Catholic, and anti-labor views. He also used it to attack public officials such as the mayor and police chief in the city of Minneapolis for corruption. In 1927, his newspaper was closed down under a Minnesota Public Nuisance Abatement Law (called by some the Minnesota Gag Law). This law permitted a judge, acting without a jury, to stop the publication of a newspaper if the judge found it “obscene, lewd, and lascivious” or creating a public nuisance by “malicious, scandalous, and defamatory” publication. Minnesota courts all upheld the closing of Near’s newspaper under the law, and Near appealed to the Supreme Court.

By a 5-4 vote, the Supreme Court declared the Minnesota law unconstitutional as a violation of the freedom of the press guarantee of the First Amendment. Using the so-called “incorporation doctrine,” the Court thus used the due process clause of the Fourteenth Amendment to apply the First Amendment’s freedom of the press to the states. In his opinion for the majority, Chief Justice Charles Evans Hughes wrote: “In determining the extent of the constitutional protection, it has been generally, if not universally, considered that it is the chief purpose of the guaranty to prevent previous restraints upon publication.” Hughes went on to note that, while the prohibition against previous restraint of the press is not absolute, it is allowed “only in exceptional cases.” The remedy, Hughes pointed out, for those who feel that they have been wronged by false accusations in the press is a suit for libel.

In 1933, using its constitutional power to regulate interstate commerce, Congress passed the National Industrial Recovery Act as part of President Franklin D. Roosevelt’s New Deal to help stimulate the economy and reduce unemployment. This was Roosevelt’s first and major instrument for dealing with the Great Depression. Under the law, all industry groups were authorized to draw up “codes of fair competition” for businesses, including standard and acceptable practices in business and fair wages, hours, and working conditions for workers. The Live Poultry Code was one such example. The Schechter brothers operated slaughterhouses in New York City which received live chickens from outside the state, slaughtered them, and then sold them to local stores. They were charged, prosecuted, and found guilty in a U. S. District Court of violating the wage and hour provisions of their industry’s code and with selling an “unfit chicken.” (For this reason, the case is sometimes called “the Sick Chicken case.”) After their conviction was affirmed by an appellate court, they appealed to the Supreme Court.

The Supreme Court unanimously ruled in favor of the Schechters. The Court found that the Schechters were engaged in intrastate commerce which had only an indirect effect on interstate commerce and thus was beyond Congress’ regulatory power over interstate commerce. Second, the Court found that the law which empowered groups outside Congress to make the codes was an unconstitutional delegation of legislative power. The Court’s decision in the Schechter case was considered a major blow to the New Deal and Roosevelt’s plan for recovery from the Great Depression.