ABSTRACT

The economic issue was the use of economic power by the government in enforcing its commands, additional to its historical use of physical power. The Congress, in adopting the Agricultural Adjustment Act, had assumed, in conformity with traditional economists and Courts that economics was a field of voluntary agreements, contrasted with sovereignty as the field of compulsory agreements. Justice Roberts denied that either a state government or the federal government was permitted, under the Constitution, to use the economic power. He argued that its use by government was coercive against private parties and not voluntary agreement on their part, and was therefore prohibited. His leading case was a decision ten years earlier by the same Supreme Court against the use of economic power by a state railroad commission. Justice Stone agreed that the use of economic power by the government was coercive, similar to the power of taxation, and that both were subject to abuse in extreme cases.