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A Constitutional History of the United States
Chapter LI - Interstate Commerce; Railroads; Trusts: Amendments; The Presidency; Conclusion
by McLaughlin, Andrew C.


When we examined the Court decisions interpreting and applying the fourteenth amendment, we found the judiciary facing the problems which arose from the establishment of state commissions. Whatever may be said of constitutional theory and all the mists of legal argument, the fact is that the nation and the states, in the later years of the nineteenth century and the early years of the twentieth, were entering upon the commission habit. Amid all the problems which were involved in the development of constitutional law and governmental procedure, that fact stands forth with peculiar distinctness. Commissions were intrusted with extensive power, granted by statutes of a general character. Administration and practical application were in the hands of the commissions. The fact, as in so many other instances, is of more importance than the theory; but constitutional problems inevitably arose; for the whole development, though not utterly without precedent, was essentially new.

Considerable attention was given by the courts to the interpretation of statutes, with intent to discover whether the commissions had transcended the authority granted them; and there was, of course, the perennial question whether they had respected due process. But there was a more elementary problem: had the legislature improperly delegated legislative or judicial authority and thus broken down the traditional separation of the powers or disregarded the elements of constitutional order? And still, every passing day made more obvious the inability of legislative bodies, by plodding along the old route, to meet the tasks produced by the new economic conditions. It was impossible to pass legislation so general, so explicit, and so detailed as to leave no room for judgment in interpretation, application and enforcement.

In the later years of the last century, the courts, as we have seen, were finding barriers against encroachments upon property rights. To condemn and to criticize, to charge the courts with arid and unimagi-

native conservatism is an easy and comfortable occupation; but it leaves out of consideration the difficulty of the problems of adaptation. And yet, the Supreme Court during those years appears in most ways to have been holding back with what now seems unnecessary persistence.[1] There were, it is true, certain decisions which indicated that there were joints in the defensive armor.[2] But on the whole the conservatism of the supreme bench during that period appeared nearly invulnerable. At the beginning of the period when the courts were or appeared to be resisting a public movement for further social control, Congress entered upon the task which endured for a generation — the task of regulating and properly controlling the railroads. The decisions in the Granger Cases were important but they were not enough. The roads engaged in interstate commerce could not be effectively regulated by state legislation. That fact was daily becoming more evident. Mere words fail to convey any proper impression of the confusion and the iniquity prevalent in railroad affairs in the eighties. The building of new roads had been going on at a rate hitherto quite unparalleled; in 1886, alone, 12,983 miles of road were laid down.[3] Competition had reached such a state of excess that it was destructive of actual corporate interests or at least of respect for public well-being. Individual shippers were favored at the expense of their rivals; discriminatory rates favored one locality and worked hardship to another; rebates were granted in some instances so excessive and discriminatory as to reach into the realm of the comic opera. Speculation ran riot; and while the big shipper found means of increasing a rapidly swelling fortune, the small shipper and the public paid the piper. The whole story is a tale so confusing, so sordid, so wanting in the elements of merit or common sense, that we find it difficult to understand why it took so long to establish, simplify and rationalize the control of railway traffic in the public interest.

In 1886, the Supreme Court, after referring to the Granger Cases, declared that it was not and never had been the deliberate opinion of the majority of the Court that a state statute, which attempted to regulate railroad charges within its limits for a transportation involving a part of commerce among the states, was a valid law.[4] Unless the roads, therefore, were to be left to their own devices in interstate business and allowed to indulge freely in the game they were playing, Congress must act. The next year Congress passed the Interstate Commerce Act and established the Interstate Commerce Commission. The act declared that rates should be reasonable and just. Rebates and discrimination between persons and places were forbidden, as were also pooling and traffic agreements; it was declared unlawful for any carrier to charge more for transportation, under substantially similar conditions, for a shorter than for a longer distance over the same line, in the same direction, "the shorter being included within the longer distance". The Commission was authorized in special cases to relieve the carrier from the operation of this last provision, the justly famous "long and short haul" clause.[5]

The Commission started out bravely and accomplished something. Little by little, however, its power for good was so whittled away by judicial decisions that by the end of the century it had become little more than a body to collect data and make reports. Portions of the act, indeed very essential portions, had from the beginning proved to be difficult of enforcement; and though in 1889 it was provided that a violation of the act was punishable by fine or imprisonment or both, rebates and other discriminations were not easily prevented. In construing the statute, the Court was determined to guard against the exercise of any power not plainly granted the Commission; and in addition the justices feared lest the Commission should so act as to exercise legislative or judicial authority. That regulation could be laid down by Congress to apply in detail to the whole country, and be laid down with such explicitness as to be capable of application to every conceivable situation, was of course no more than an iridescent dream. But as every important rule or order of the Commission was subjected to judicial investigation before it could become effective, the Commission was placed in the position of having to defend itself at every turn. The procedure involved appeals, sometimes years of delay, while every possible obstacle was thrown in the pathway of the body charged by the government with a difficult and perplexing task.

The climax was reached in 1897, when the Court said: "It is one thing to inquire whether the rates which have been charged and collected are reasonable — that is a judicial act; but an entirely different thing to prescribe rates which shall be charged in the future — that is a legislative act." [6] Though the opinion pointed to certain powers which the Commission could properly exercise, this authority was not satisfactory or consoling to the public desirous of seeing a solution of the vexing problem and an end of the iniquities of railroad managers still engaged in ridiculous maneuvers. The people had not surrendered their faith in the virtue of competition; they intended to make it compulsory; but they specially demanded respect for public needs and not merely scramble for booty.

The tide of popular discontent was rising — fear of the money power, the grasp of a few men upon the transportation systems and certain natural resources of the country, indignation against trusts and monopolies, all pointed to the necessity of congressional legislation for curbing unwholesome evils. The chief influence in producing remedial legislation was, of course, the arrogance and the misdirected zeal of the railroad authorities themselves; for it appears to be a rule of life that the extremists defending an outworn fortress batter down their own defenses. Certain changes in the original act were made in 1903, at the request of the railroad managers themselves. In his annual message of 1904, President Roosevelt said that railroad regulation was of prime importance, and he returned to the subject the following year. A new statute was enacted in 1906. In passing on the questions raised by specific complaints, the Commission was given power to prescribe just and reasonable maximum rates. Its conclusions were to have presumption of validity. In other words, the great burden was thrown upon the roads and taken from the shoulders of the Commission. The discussions in Congress when the act was under consideration and, indeed, the whole controversy disclose the essential issue — the extent to which the legislative body can delegate its power. In 1910 an additional act was passed strengthening the Commission's hands in certain respects.

Important judicial decisions upheld the Commission's authority, and the principles were clearly set forth: "One question remains for discussion, the finding of the Commission upon the character of the rate, whether it is unreasonable as decided. Such decision, we have said with tiresome repetition, is peculiarly the province of the Commission to make, and that its findings are fortified by presumptions of truth, 'due to the judgments of a tribunal appointed by law and informed by experience.' " [7] This plainly involved a recognition of the powers of Congress to delegate power to fix rates, and the recognition that rates so fixed would, when subjected to judicial scrutiny, have the presumption of legality and propriety. The Court did not, however, totally abdicate. It reserved the right under certain circumstances not to accept the Commission's findings and rules.[8] In 1912, its position was summed up as follows: the orders of the Commission are final unless beyond the power which it can constitutionally exercise; or beyond its statutory power; or based on mistake of law. An order, regular on its face, may be set aside if it appears that the rate is confiscatory and in violation of the constitutional prohibition against taking property without due process of law; or if the Commission should act arbitrarily and in an unreasonable manner.

Before long, the task of effective regulation was seen to involve more than the mere right of Congress to regulate rates and to control interstate traffic. For the whole process was found to be so inclusive, transportation was so obviously national, that the states even in the management of their own internal commerce were necessarily limited. This fact is illustrated by decisions upholding the power of the federal Commission so to adjust intrastate rates as not to interfere with interstate rates established by federal authority. The existence of such a power was indicated by certain statements made by the Court in 1913; [9] and the next year in the Shreveport case the principle was accepted and applied.[10] At a later date, Chief Justice Taft, giving the opinion of the Court, used these comprehensive and conclusive words: "Commerce is a unit and does not regard state lines, and while, under the Constitution, interstate and intrastate commerce are ordinarily subject to regulation by different sovereignties, yet when they are so mingled together that the supreme authority, the Nation, cannot exercise complete effective control over interstate commerce without incidental regulation of intrastate commerce, such incidental regulation is not an invasion of state authority or a violation of the proviso." [11]

During the later years of the nineteenth century and the first few years of the twentieth, the attempts to control the railroads were not meeting with conspicuous success. Furthermore, another problem, closely associated with the railroads but even more difficult, had forced itself upon public attention. The process of accumulating vast fortunes had been going forward at a rapid rate. Men gifted with shrewdness, business sagacity and a determination to be rich and powerful, took advantage of highly developed transportation systems, the natural resources of the land and the impressive expansion of the nation, to build up a system of industrial control so extensive and so remunerative that the stories of Croesus or Monte-Cristo appear like plaintive tales of penury.

One fact stands forth with especial clearness: the very extensive control in the hands of one man or a single group of men demonstrated plainly the fact that industry was in some cases so nationalized that only national authority could regulate it. The men who were thus engaged, or beginning to be engaged, in this constructive process, this articulation, this coordination, were creating a structure which by its very nature subjected itself to governmental administration or at least oversight. It used to be said that they were preparing the way for socialism — not by the way of revolt, and of course not intentionally, but as a natural consequence of what they had themselves accomplished in so combining natural resources, transportation and industrial activity as to simplify the task of governmental ownership. Whether that conclusion be sound or not, the development did bring attempts at governmental control and restraint; and the future is to decide whether control is to be expanded and whether restraint is to be followed by ownership. In one way, regulation appears to be a process antagonistic to a further approach toward socialism — or, if the reader wishes a different term, governmental ownership of productive enterprises — because regulation may make complete ownership and complete direction needless. On the other hand, if it fail, it may naturally lead to the forced abandonment of private ownership and control. The main matter of importance to us, as students of history, is, however, that the skill and energy and constructive power of industrial magnates brought into being a high degree of correlation and consolidation, and the onlooker was inevitably led to question whether the nation would be in the hands of a few industrial monarchs or be governed by popular vote.

So, soon after the establishment of the Interstate Commerce Commission, came a demand for the curbing of trusts, a name meaning in common parlance any large industrial enterprise which because of its power was able to crush smaller competitors and subject the public to unreasonable prices.[12] The demand resulted in the passing of the Anti-Trust or Sherman Act in 1890. Naturally the constitutional basis for the act was the interstate commerce clause. It declared every contract or combination or conspiracy in restraint of interstate or foreign trade or commerce to be illegal. It also declared it illegal to monopolize or attempt to monopolize any part of interstate or foreign commerce. Violation of the act was made a punishable offense. The act lay on the statute book for several years without serious ruffling of its pages.

Most of the numerous decisions of the courts on this matter are not within the field of constitutional law, save as any construction of a statute may be considered as having constitutional significance. Once it has been accepted that the power to regulate interstate commerce involves the power to make combinations and monopolies illegal and to declare certain practices punishable, the main constitutional principle is acknowledged. But the history of the attempt to make the antitrust legislation effective is of importance; the public criticism of judicial decisions, whether such criticism be technically valid or not, and the difficulties encountered in the application of law are not outside the field of constitutional history. In the whole matter, however, not the technical power to legislate, but the fact of legislation, which was an extension of the former actual activities of the nation, is the crucial matter. Everywhere we turn we find the broadening of national authority and, as a matter of reality, the comparative subordination or submergence of the states.

Five years after the passage of the act, the Supreme Court, in the Sugar case, declared that manufacturing within the limits of a state was not within the field of interstate commerce and that the act did not authorize restraint or prevention of contracts relating exclusively to the acquisition of refineries in a state, the object of which was private gain but not through the control of interstate or foreign commerce.[13] It appeared for a time that in light of this decision it would be impracticable to make anti-trust legislation effective; but not long thereafter, there was a series of decisions which gave the act effect and forecast further results. In the Trans-Missouri Freight case, a contract between competitive railroads, having the effect of restraining trade, was held to be within the provisions of the Sherman Act.[14] That conclusion was of prime importance. In 1899, the Court held illegal an association of pipe manufacturers who had entered into an arrangement whereby there should be no competition between them in certain areas embracing in the aggregate a large portion of the union.[15] This combination presented a condition quite easily distinguishable from that presented in the Sugar case; the association was plainly a contrivance for the elimination of competitive interstate prices. Then came the Northern Securities case,[16] declaring illegal a holding company which, through the ownership of stock of two companies, controlled two railroads which were natural rivals. This was not merely an arrangement for the investment of capital but a plan so to manage two roads as to eliminate uncomfortable competition.

There followed in the next few years the dissolution of certain big combinations — the so-called Beef trust,[17] the Standard Oil trust,[18] and the American Tobacco trust.[19] Whatever may have been the public zeal for drastic action, this at least may be said: the act in question and the important decisions of the Court made plain the fact that Congress could effectively prohibit combinations or conspiracies which, actually within the sphere of interstate commerce, interfered with reasonable competition and freedom of communication. The justices, however, held different opinions concerning the meaning of "restraint of trade" and concerning the application of the prohibitions of the statute. In the Standard Oil case, Chief Justice White, giving the opinion, announced the "rule of reason." The same year, in the Tobacco Trust case, the Chief Justice, expounding this doctrine or principle, gave the following explanation: "It was therefore pointed out that the statute did not forbid or restrain the power to make normal and usual contracts to further trade by resorting to all normal methods, whether by agreement or otherwise, to accomplish such purpose. In other words, it was held, not that acts which the statute prohibited could be removed from the control of its prohibitions by a finding that they were reasonable, but that the duty to interpret which inevitably arose from the general character of the term restraint of trade required that the words restraint of trade should be given a meaning which would not destroy the individual right to contract and render difficult if not impossible any movement of trade in the channels of interstate commerce — the free movement of which it was the purpose of the statute to protect." [20]

The rule of reason, which now became a standard principle, caused some leaders of industry to charge that the result was to leave the whole subject in vagueness and uncertainty; and it was also said by other critics that the Court was intent upon reading into the statute its own notions of what was beneficial and what was harmful. Justice Harlan, concurring in part and dissenting in part, said, "After many years of public service at the National Capital, and after a somewhat close observation of the conduct of public affairs, I am impelled to say that there is abroad, in our land, a most harmful tendency to bring about the amending of constitutions and legislative enactments by means alone of judicial construction." He declared that the majority of the Court had in effect said, "You may now restrain such commerce, provided you are reasonable about it...." [21] That he pronounced to be a clear instance of judicial legislation.

Two acts passed by Congress (1914) — the Clayton Act and the Federal Trade Commission Act — were additional attempts to compel the abandonment of unfair methods of competition and to make the anti-trust legislation effective. They embodied President Wilson's theories which aimed to bring in a new industrial order shorn of the abuses of the past. Only a very bold man would try to indicate briefly, or even in many words, the effect of these measures. They are mentioned here only as an indication of the prevailing desire to improve industrial conditions and business practices. At the present writing, the whole subject is undergoing such radical alterations — if not in constitutional law, at least in the public mind — that it is difficult to get a proper perspective; an effort to distinguish the headlands marking out with any clarity the main outlines of historical progress is peculiarly difficult. So futile appear to be the attempts of the past, or at least so far from satisfying the public demand, that it seems as if the whole history of trade-regulation under the interstate commerce power will in the future be looked upon as valuable only because it illustrates the difficulty of the problem, and because the attempts proved to be the forerunners of further and more drastic methods. The whole movement, which purposed to secure social justice and economic freedom by insisting upon competition and by reliance upon the ameliorating effect of compulsory rivalry, appears to be nearing its close. In the public affection, planning seems to be taking the place of compelled competition; restriction is to be supplanted by guidance and, mayhap, control or even public ownership.[22] Nationalism is so real and its realities are so dominant, that any microscopic investigation of the commerce clause of the Constitution is likely to be worthless; and we are probably right in assuming that any method, deemed to be constitutional, will be used if necessary to correct — or seek to correct — what are thought to be the evils of the commercial world. What can be done under the shadow, or in the light, of the commerce clause only the venturesome would dare to predict.

With these few words bearing upon the character and the interpretation of the Interstate Commerce Acts and the Sherman Act, we must be content; but the reader must not be left with the impression that the courts were not busy, without reference to those particular statutes, in passing upon various phases of interstate commerce law. And yet in a general way the principles laid down by the Court, from the time of Gibbons v. Ogden (1824) to and including the Cooley v. Port Wardens case (1851), stand on the whole unaffected by the passing of time, in so far as the earlier cases mark out the broad lines of demarcation between intrastate commerce on the one hand and interstate and foreign commerce on the other.[23] The later cases largely involved the application of these principles; fine distinctions were drawn, so fine that the lay reader may at first sight not see them at all.[24] But if distinctions were at all times perfectly obvious, there would be little use for courts.[25]

Congress in recent years has exercised by explicit and affirmative legislation the power of regulating interstate commerce, and has gone so far as to prohibit altogether the transportation of certain articles. In doing so, it has aimed to protect or enhance the well-being of the people and has done this so extensively that it is not uncommon to speak of federal police power; but technically this term must be considered a misnomer; for the powers of legislation must in theory arise from specific or implied grant by the Constitution itself; the Constitution makes no grant of the police power to Congress. The extent of the power in such matters was announced with particular clarity in 1913: that the power over transportation among the several states "is complete in itself, and that Congress, as an incident to it, may adopt not only means necessary but convenient to its exercise, and the means may have the quality of police regulations." [26] The Court also said, "Our dual form of government has its perplexities, ... but it must be kept in mind that we are one people; and the powers reserved to the States and those conferred on the Nation are adapted to be exercised, whether independently or concurrently, to promote the general welfare, material and moral." It has been held, therefore, that federal legislation may forbid the transportation from one state to another of stolen automobiles, lottery tickets, adulterated articles, obscene literature, prize-fight films, and women for immoral purposes.[27]

So inclusive and extensive was the power of regulation as recognized by the Court, that there was a belief, by no means baseless, that an act excluding from interstate transmission articles made in factories employing child labor would be upheld. But it was declared invalid as a distinct interference with the police power of the states.[28] Four justices dissented — it was one of the four to five decisions which have been made with regrettable frequency in recent decades. Inasmuch, said the dissenters, as the Court had recognized congressional authority to forbid interstate transmission of various articles believed to be harmful, there should be no hesitation about upholding an act directed against an evil generally condemned, "the evil of premature and excessive child labor." The majority, however, made a distinction between the act in question and such other legislation as had been held valid: "In each of these instances the use of interstate transportation was necessary to the accomplishment of harmful results. In other words, although the power over interstate transportation was to regulate, that could only be accomplished by prohibiting the use of the facilities of interstate commerce to effect the evil intended. This element is wanting in the present case."

After the decision announcing the invalidity of the child labor act, ostensibly an exercise of the power to regulate interstate commerce, Congress resolved to use its taxing power for the same purpose. The statute, it seemed, would be more acceptable to the Court than the previous one; for in various cases, tax laws which had the real purpose of prohibition and not revenue had been upheld.[29] But the act like its predecessor was pronounced invalid.[30] The Court found a difference — substantial enough to be visible to those desiring to see it — between the act in question and earlier acts in which the broad scope of the taxing power had been recognized; for the statute, now declared void, appeared to make plain on its very face that its object was repression rather than revenue. The decision therefore did not, in the Court's mind, contravene the principle that the Court would not enter upon an examination of motive or reject an act because there might be a purpose auxiliary to the main intent, if the act on its face and in its general tenor appear to be an exercise of undoubted congressional power.[31] If the justices are to be criticized for their stand and charged with obstructing the extirpation of an evil, something may also be said of the moral impropriety of a government's attempting to accomplish its purpose by a subterfuge; everyone knew that the purpose of the act was to stamp out child labor. In other words, legislative artifice is constitutionally and politically immoral, if there is any force remaining in the old belief that there should be a government of laws and not of men and that governments are to be limited by supreme law, and if federalism as distinguished from centralized nationalism is to survive. But judicial decision did not end the matter. In the flood of ideas and proposals for the change of laws and the Constitution itself, came a proposed amendment to the Constitution giving Congress power to regulate and to prohibit labor of persons under eighteen years of age (1924). At the present writing the amendment has not been ratified.

It used to be taken for granted that the amending of the federal Constitution was so difficult and the process so elaborate that there could be no reasonable hope of alteration unless it was the consequence of an earth-shaking emergency. Only the thunders of civil war, it was said, had produced any change of vital importance since the beginning of the government. The first third of the twentieth century proved this belief was not well-founded. During that period six amendments were adopted.

The sixteenth amendment gave Congress power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the states (1913). The movement which had been on foot for a generation had reached its goal. Acting upon the authority thus granted, Congress levied a graduated tax, and to this there could be no constitutional objection. The Constitution declares that all duties, excises and imposts shall be uniform throughout the United States, but a tax is held to be uniform when it has the same force and effect in every place where the subject matter is to be found.[32] The various acts passed by virtue of this grant of power are supremely important. The power to tax large incomes and to tax them heavily, as well as to exempt other incomes altogether, is of so much importance and so likely to have influence on economic and social conditions, that the significance of the amendment is apparent without extended comment. As a matter of plain fact, it rivals in importance the first section of the fourteenth amendment; and, indeed, if we consider all its possible effects, it may be considered the most far-reaching addition to the Constitution in the last hundred and forty years. The student of society, viewing our whole taxing system, is inclined to look with misgivings on a policy which has the effect of relieving many millions of people of any consciousness that they are carrying the expense of government. But on the other hand, the amendment furnished one method, which has been in some degree effective, of remedying the evil of gross inequalities in the distribution of wealth; and without some process directed to that end and reasonably adapted to social well-being and political order, democracy may find difficulty in keeping alive. These comments, however, are directed to questions of legislative policy, not to problems of constitutional power.

The seventeenth amendment provides for the popular election of senators (1913). The purpose was doubtless to deprive political partisans of the opportunity to use corrupt methods of influencing state legislatures and also, perhaps, to make certain the selection of men to the Senate who would immediately represent the public and the public interest. There was probably the further hope of ennobling the character of the Senate by the introduction of men of superior quality. The people were now prepared to reject in toto the remnant of the old trust in the filtering process as a method of setting wisdom on high. The movement producing this amendment was like that which made effective changes in popular government in the Jackson period and the years immediately preceding Jackson. That these aims have all been realized, may well be questioned or passed over without serious discussion. The old-fashioned battles in the legislatures have, of course, disappeared; and thus one scandal, which not infrequently had mocked at popular government, was disposed of. Lifting from the shoulders of state legislatures the burden of electing senators ought in theory to have relieved the legislators from domination by the national parties; men chosen by the people of the state could henceforth divide as they might wish on purely state issues; but there is little evidence of such a result. Allegiance to national parties has proved too strong to be effectively resisted.

The manufacture and transportation of intoxicating liquor was prohibited by the eighteenth amendment (1919). Before its ratification, nearly all the states had enacted prohibition statutes, some of them at a much earlier time. It cannot be said that the amendment was cast into the face of an unsuspecting public. Prohibition had a sorry history. But the amendment presented no very serious trouble to the Court. Able attorneys argued with earnestness and apparent sincerity, but without avail, in attempts to obtain a decision declaring the amendment unconstitutional. Their arguments were based largely on the untenable assertion that there are certain implied limitations on the amending power — practically, therefore, a declaration that the people of the United States would not have adopted the Constitution in 1788, had they imagined that their remote posterity would find a way of changing the structure of the union in any vital particular. In the most important case, the Court disposed of the arguments against the validity of the amendment and did so in a few brief paragraphs, without extensive discussion.[33] The amendment was repealed by the adoption of the twenty-first amendment in 1933, the only amendment, since the formation of the government, which was ratified by state conventions rather than by legislatures. Its second section grants to the national government, not only the power but also, presumably, the duty to see that state prohibition laws or other acts restraining the use and delivery of intoxicating liquors are not impaired or rendered useless by the transportation of the liquors in the course of interstate commerce. Women were given the suffrage by the nineteenth amendment (1920). The subject had been under periodical discussion for over fifty years. Attorneys had the courage to ask the Court to declare the amendment unconstitutional, once again asserting the existence of an implied restriction on the amending power. But naturally the Court could not accept this doctrine.[34] There is something amusing in this strange situation: for years, there had been insistent criticism and complaint because the Court was not ready to recognize the validity of legislation violating in the opinion of the justices the principle of due process; there had been a demand freely and forcibly expressed to the effect that people, acting through their legislative bodies, should have what they wanted and not be continually held in check by constitutional limitations enforced by courts. And yet, in the cases above referred to, we find persons enthusiastically proclaiming the inability of the people to change the Constitution itself, if the change be unpleasant or contravene what litigants may think to have been the intention of the men of the eighteenth century.

The twentieth amendment (1933) provides that terms of office of the president and vice-president shall begin on the twentieth day of January, and the terms of members of Congress on the third. The long period of uncertainty between the election of a president and the beginning of his term of office — a period which at times was little less than an interregnum — was thus abandoned. And there was ended also the power of Congress to legislate for several months after a new Congress was chosen by the people. That the inconvenience of the old method — and much more than mere inconvenience — should have lasted for over one hundred and forty years is an indication of the strange conservatism of a progressive people.[35] Of importance also is the provision for filling the presidential office in case of death of the presidentelect, and if no president is chosen or has failed to qualify before the beginning of the presidential term.

The most evident fact in the constitutional history of the United States in the last thirty or forty years is the expansion of the actual activities of the national government.[36] The building up of the departments at Washington and their continuous operation present a picture of great interest. It is impossible to describe, and much more difficult to define, the bureaucratic system, or to indicate without minute statement the extent to which the government has taken over what by any earlier conception would have been considered the duty and the power of the states alone. The intrusion of the hand of the central government is plainly seen in the granting of subsidies to the states and in the oversight of expenditures as well as in the enforcement of certain acts.

Most of the congressional measures of this character — if one attempts to find a constitutional basis — appear to rest upon the power of Congress to regulate commerce and the power to appropriate money.[37] The fact of developing centralized control or direction is the main thing. The increase of the annual expenditures is enough in itself to demonstrate the realities of the situation.

In all this expansion of the actual activities of the federal government, we see of course the tendency exhibited by all the governments of the nation to do many things which in earlier years were left to the individual or left undone altogether. Governments both state and national have entered upon undertakings quite beyond the old fields of governmental practice. But the tendency to rely upon the national government to do things which were within the scope of state authority is obvious. The result is that, though federalism still exists as the theoretical structure of the union, it has lost ground in the public consciousness. The desire to get things done, and to get them done quickly, induces people to bring pressure upon the central government rather than rely on the spontaneous action of the states. There has been in recent decades a tendency to look upon doubts of constitutional authority, and especially the constitutional competence of the national government, as mere somber and senile legalistic trifling. Many persons are ready to throw their individual or local responsibilities on the shoulders of a government removed from their very immediate control. The underlying sense or sentiment of the people is in reality national, not local. State pride and state feeling of local authority have greatly diminished.

We must, naturally, take into full consideration the reality of the situation: national industrial unity; the fact that in the modern world neither a state nor an individual can live an isolated life; the states as they now exist are bounded by surveyors' lines; and though there are sectional differences and sectional interests, the particular state, as a rule, has no personality based on its physiography, its peculiar character, or its traditions. Federalism, therefore, as a system of political order, has been weakened, perhaps is beyond repair. To the reader such generalizations as these are probably perfectly obvious.

To realize the full significance of what has taken place in the passing decades, we need to look back to earlier times. Jefferson's famous inaugural address, given at that dramatic moment when he took the oath of office administered by John Marshall, contains this passage: "Still one thing more, fellow-citizens — a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned." That was the sentiment of democratic individualism with which the nineteenth century began. Hamilton and Madison, defending the new Constitution when presented to the states for adoption, found it necessary to combat the charge that the new system would result in the consolidation of the union, or, to use the words of recent days, that a unitary state would be ultimately founded on the ruins of the federal state. Both of these statesmen believed that natural tendencies would support the authority and vigor of the individual states: "It will always be far more easy for the state governments to encroach upon the national authorities," said Hamilton, "than for the national government to encroach upon the state authorities. The proof of this proposition turns upon the greater degree of influence which the state governments, if they administer their affairs with uprightness and prudence, will generally possess over the people...." [38] Neither of these statesmen could reckon with the railroad, the telegraph, the automobile, and the radio or with the new ethos of the people — that spirit or essence to which governmental forms ultimately adapt themselves, even if the spirit be one of heedlessness.

In the early years of the twentieth century, Theodore Roosevelt expressed by word and deed the belief in the necessity for effective governmental activity and for the exertion of national authority which should be exercised fearlessly. Just what he meant by "new nationalism" is not altogether easily gathered or expressed; but certainly he did not wish to see the welfare of the people — as he conceived that welfare to be — jeopardized by any minute legalistic doctrine concerning the respective fields of state and national power; and he associated his principles with his belief in the duty of the president to act for the public good. In those days there was frequent reference to the "twilight zone" — the area within which the state could not work effectively and into which the federal government could not or might not enter.[39] In 1910, after retiring from the presidency, he used in a public address the following words: "The state must be made efficient for the work which concerns only the people of the state; and the nation for that which concerns all the people. There must remain no neutral ground to serve as a refuge for lawbreakers, and especially for lawbreakers of great wealth, who can hire the vulpine legal cunning which will teach them how to avoid both jurisdictions.... The New Nationalism puts the national need before sectional or personal advantage. It is impatient of the utter confusion that results from local legislatures attempting to treat national issues as local issues.... This New Nationalism regards the executive power as the steward of the public welfare...." [40]

In 1907, three years before this speech was made, the Supreme Court had been called upon to meet an argument connected with this general theory of sovereign and inherent power in the national government. This argument, the Court said, was substantially this: "All legislative power must be vested in. either the state or the National Government; no legislative powers belong to a state government other than those which affect solely the internal affairs of that State; consequently all powers which are national in their scope must be found vested in the Congress of the United States." This theory was unacceptable: "But the proposition that there are legislative powers affecting the Nation as a whole which belong to, although not expressed in the grant of powers, is in direct conflict with the doctrine that this is a government of enumerated powers." [41]

Mr. Roosevelt, it will be noticed, connected his "new nationalism" with the power and the duty of the president as the steward of the public welfare. In an earlier chapter of this work which dealt with Jackson and the presidential office, reference was made to the theories of Theodore Roosevelt, who acted, as he said, on the Jackson-Lincoln theory of the presidency. We must consider his position an indication not alone of his personal ideas but also partly of the real, and perhaps we can say inevitable, development of the presidential office. In some respects the development was associated with the increase in national authority, to which we have already pointed. But it is difficult to trace with any degree of accuracy the growth of the office in the last hundred years; the history of the office demands a volume rather than a paragraph. The line of growth was not straight and the upward curve was far from uniform. The extent of actual presidential authority or, more correctly, presidential influence and direction, have varied as different incumbents came into office; actual directive force has been affected or created by circumstances and most of all by the personality of the president himself. At times he has been the center of public attention and even the mainspring of governmental action. At other times, his influence has not been conspicuous. Such additions, however, as are made to the office at one time are not likely to be entirely lost. In the hands of a man capable of wielding the powers normally within his grasp, the office is one of immense power. And still, despite recession and accretion of influence and authority, one fact stands forth fairly clearly: a president's power to shape legislation and to direct the course of government rests on his proper gauging of public opinion, in his ability to appeal skillfully to popular sense and sensibility. To this extent democracy has thus far proved faithful to itself and has battled successfully in its own defense.

The duties of the executive department as a whole increased greatly during the first quarter of the present century, because the national government was entering upon new fields; but we are dealing here chiefly with the president's power to guide or form legislative policy. At times, he has appeared to be assuming the role of a prime minister initiating legislation and attaining his purposes. The strength of his position has been maintained by his veto, by his power to appoint and remove officials, by his unique opportunity to appeal for public support, and by the fact, as Jackson's career illustrated a hundred years ago, that he is the single representative of the whole people. A president, with the people behind him, can go far in subjecting Congress to his will.[42]

If we may base a judgment upon the recent experiences of European states, we are justified in assuming that democratic government is peculiarly endangered, not so much by the intrigues of ambitious leaders hungry for power, as by legislative inefficiency, by interminable debates of which the people grow weary, by the existence of many parties, by petty objections and crafty obstruction, by blocs and factions, by party incoherence and consequent absence of assignable responsibility. The two-party system, which has fairly well maintained itself in our history, may not be the best conceivable system; but the history of the modern world appears to make plain that it is the best arrangement as yet devised for assuring orderly development and reasonable stability of popular government. Many people have criticized parties and have become restless because of the prolonged and often futile debates of party spokesmen in Congress; but we can only with difficulty imagine the condition which would ensue, if there were eight or ten competitive groups, each seeking its own advantage and all of them making systematic legislation nearly impossible. Minor parties, which are commonly composed of enthusiasts for particular reforms, have played at times an important role, because they have given definite shape to certain ideas and supported them by organized effort. In some cases they have compelled attention to vital issues, for a third-party platform is intended for use and not merely for exhibition. But so strong has the two-party system been and so tenacious of its own life, that one or both of the major parties were likely to pilfer from the third party portions of its programme — such portions as appeared to be attracting favorable public attention. For a party does not live on sentiment alone, but on the bread of office, and if it wishes to maintain its own vitality, it must absorb strength where it may be found.

As we close this work covering in outline the history of nearly two hundred years, we are led to reflect upon the obvious. The constitutional system, which, when it was established, derived its substance from the experiences and the efforts of previous centuries, has survived. In this modern world, that simple fact is an achievement. Formed for less than four million people living in a narrow area along the coast, it has been adapted to the needs of thirty times that number occupying half a continent. If federalism, democracy, and individual liberty are drowned in the torrent and whirlpool of the future because men are found incompetent to govern themselves, the historical fact remains — for a hundred and fifty years the Constitution lasted as the fundamental law of a successful people. Only the un-historical-minded person, fretted by his present and immediate ills, will underestimate this fact. He may well call to mind the words of Jefferson, who at the opening of the nineteenth century had the boldness to pronounce his faith in America as "the strongest Government on earth.... Sometimes it is said that man can not be trusted with the government of himself. Can he, then, be trusted with the government of others? Or have we found angels in the forms of kings to govern him? Let history answer this question." Since these words were spoken, ancient dynasties and old monarchical systems have disappeared; new monarchies have risen and fallen; and the American constitutional system still stands.


[1] It is not an unimportant fact that the following cases were all decided within a period of five years, 1894-1890; the Sugar case, United States v. E. C. Knight Co., 156 U. S. 1; Reagan v. Farmers' Loan and Trust Co., 154 U. S. 362; the Income Tax case, Pollock v. Farmers' Loan and Trust Co., 157 U. S. 429, 158 U. S. 601; Smyth v. Ames, 169 U. S. 466. And what shall be said about Allgeyer v. Louisiana, 165 U. S. 578? To a student conversant with the constitutional history of England or the history of America for a hundred years after the adoption of the Constitution, it seems strange to point to this case, which staked out the wide field of individual liberty, as an example of judicial conservatism; but in the new conditions, it may perhaps be so listed as the basis of later cases of a conservative character, especially Lochner v. New York.

[2] For example, Holden v. Hardy, 169 U. S. 366 (1898), the hours of labor case, which opened the way for later decisions accepting the validity of state statutes limiting hours of labor.

[3] "The decade of the eighties, so far as common carriers are concerned, was primarily characterized by new railroad construction. Over 70,000 miles of line were built in ten years...." W. Z. Ripley, Railroad Rates and Regulation, p. 27.

[4] Wabash, St. L. and Pac. Ry. Co. v. Illinois, 118 U. S. 557 (1886).

[5] "In one respect the law of 1887 marks a profound revolution in both commercial theory and practice. Its provisions concerning equality of rates to all classes of shippers denote a great moral uplift in the business standards of the country." Ripley, op. cit., p. 454.

[6] Maximum Freight Rate case (Interstate Comm. Com. v. Cincinnati, N. O. and T. P. R. Co.), 167 U. S. 479, 499. It should be noticed that the Commission did not pretend to prescribe a general schedule of rates, but it ordered the road to desist from charging certain prices, under certain circumstances, and not to charge more than a named price which the Commission deemed reasonable. It was quite apparent that without some such power the Commission in certain exceedingly important respects would be nearly or quite ineffective. See also the Social Circle case (Cincinnati, N. O. and T. P. R. Co. v. Interstate Comm. Com.), 162 U. S. 184, and especially the remarks, 196-197 (1896).

[7] Interstate Comm. Com. v. Chi., R. I. & Pac. R. Co., 218 U. S. 88, 110 (1910), referring with approval to Ill. Cent. R. Co. v. Interstate Comm. Com., 206 U. S. 441, 454 (1907), where the Court said, "And the findings of the Commission are made by law prima facie true."

[8] Interstate Comm. Com. v. Union Pacific R. R. Co., 222 U. S. 541, 547 (1912).

[9] Minnesota Rate Cases, 230 U. S. 352, 399, 420, 433 (1913).

[10] Houston, E. & W. Texas Ry. Co. v. United States, 234 U. S. 342, 354 (1914). "It is manifest that the State cannot fix the relation of the carrier's interstate and intrastate charges without directly interfering with the former, unless it simply follows the standard set by Federal authority." Another interesting illustration of the way in which the national character of commerce was made apparent was the decision of the Court that a state railroad commission could not order through interstate trains to stop at certain stations if local facilities were adequate. Atlantic Coast Line v. Wharton, 207 U. S. 328 (1907).

[11] Wisconsin R. R. Comm. v. C., B. & Q. R. R. Co., 257 U. S. 563, 588 (1922). "In solving the problem of maintaining the efficiency of an interstate commerce railway system which serves both the States and the Nation, Congress is dealing with a unit in which state and interstate operations are often inextricably commingled. When the adequate maintenance of interstate commerce involves and makes necessary on this account the incidental and partial control of intrastate commerce, the power of Congress to exercise such control has been clearly established." Dayton-Goose Creek Ry. Co, v. United States, 263 U. S. 456, 485 (1924).

[12] The early conspicuous combination, the Standard Oil trust, was a trust in the technical sense. Centralized control of a number of corporations was established. "Such a 'voting trust'", well known to the corporation lawyer, is of course a trust in the technical sense, involving a legal title in trustees who are bound to exercise it for the benefit of the cestuis qui trustent. Because the Standard Oil combination was so notorious, and because it appeared for a time as if a large number of great combinations would follow this form of organization, the term "trust" came to be popularly used as a generic term to describe all large combinations." J. A. McLaughlin, Cases on the Federal Anti-Trust Laws of the United States, pp. 20-21.

[13] United States v. E. C. Knight Co., 156 U. S. I (1895). "Contracts, combinations, or conspiracies to control domestic enterprise in manufacture, agriculture, mining, production in all its forms ... might unquestionably tend to restrain external as well as domestic trade, but the restraint would be an indirect result.... Ibid., 16. The combination "included 98% of the then existing sugar refining capacity of the country." J. A. McLaughlin, op. cit., p. 25. "Whether or not the blame for this decision is attributable to the Department of Justice, or to the Courts, the fact was that it inhibited practically all prosecutions of industrial combinations during nearly all the remainder of the first decade after the Statute." Ibid., p. 25.

[14] United States v. Trans-Missouri Freight Ass'n., 166 U. S. 290 (1897).

[15] Addyston Pipe & Steel Co. v. United States, 175 U. S. 211 (1899).

[16] Northern Securities Co. v. United States, 193 U. S. 197 (1904). This was a very important case, and four justices dissented. Justice White, reading a dissenting opinion in behalf of the dissentients, said that Congress was without power to regulate the acquisition and ownership of the stock and declared that if there were any such power in Congress it had not been exercised by the Anti-Trust Act. Justice Holmes also dissenting, with the concurrence of the other three, said he did not expect to hear it maintained that Mr. Morgan could be sent to prison for buying as many shares as he liked in the two railroads; and he also said that if the statute were to be construed with the literalness, which appeared to be asked for, then a partnership between two stage drivers who had been competitors in driving across a state line would be a crime.

[17] Swift and Co. v. United States, 196 U. S. 375 (1905).

[18] Standard Oil Co. v. United States, 221 U. S. 1 (1911).

[19] United States v. American Tobacco Co., 221 U. S. 106 (1911). Notice, however, United States v. United States Steel Corp., 251 U. S. 417, 451 (1920), where the Court said, "The Corporation is undoubtedly of impressive size and it takes an effort of resolution not to be affected by it or to exaggerate its influence. But we must adhere to the law and the law does not make mere size an offence or the existence of unexerted power an offence." The Court found neither a monopoly nor the use of improper methods.

[20] United States v. American Tobacco Co., 221 U. S. 106, 170-180 (1911). The general terms used in the statute left "it to be determined by the light of reason, guided by the principles of law and the duty to apply and enforce the public policy embodied in the statute, in every given case whether any particular act or contract was within the contemplation of the statute." Standard Oil Co. v. United States, 221 U. S. 1, 64 (1911). Fourteen years before this, White, dissenting and supported by three justices, pointed out the distinction between reasonable and unreasonable restraint. United States v. Trans-Missouri Freight Ass'n., 166 U. S. 290, 343, 347 ff. (1897).

[21] Standard Oil Co. v. United States, 221 U. S. 1, 105, 102 (1911). There was much comment — favorable and unfavorable — in the public press and among legal writers.

[22] "Students of the Anti-Trust Laws seldom consider them ideal. There is an occasional exception.... But economists and legal students are insisting that they represent a certain minimum protection of the public interest subject always to reexamination and modification by legislation or court judgment, which should be retained in the absence of any alternative method of control. Where competition does not work, public control of some sort or public ownership should be substituted." J. A. McLaughlin, op. cit., p. 711.

[23] Illustrations are cases bearing on the original package doctrine: Leisy v. Hardin, 135 U. S. 100 (1890); May & Co. v. New Orleans, 178 U. S. 496 (1900); Austin v. Tennessee, 179 U. S. 343 (1900); Askren v. Continental Oil Co., 252 U. S. 444 (1920).

[24] Take, for example, two cases, Brennan v. Titusville, 153 U. S. 289 (1894), and Emert v. Missouri, 156 U. S. 296 (1895). In the former an ordinance requiring a license of any person soliciting in the city orders for goods was held invalid, if applied to a person soliciting orders for goods to be shipped into the state. But in the latter case, if the person carried with him the articles and offered them for sale, demanding a license is not an interference with interstate commerce. See also Howe Machine Co. v. Gage, 100 U. S. 676 (1880).

[25] Justice Holmes, giving the opinion of the Court in a case involving the police power, states with his usual succinctness the method by which courts reach conclusions: "With regard to the police power, as elsewhere in the law, lines are pricked out by the gradual approach and contact of decisions on the opposing sides." Noble State Bank v. Haskell, 219 U. S. 104, 112 (1911).

[26] Hoke v. United States, 227 U. S. 308, 323 (1913), and cases cited. The italics not in the original. Naturally congressional power in the District of Columbia and the territories includes the police power.

[27] Examples of the exercise of "police power," incidental to or growing out of specifically granted power, were cited in a decision in the federal circuit court: "Congress has enacted a safety appliance law for the preservation of life and limb. Congress has enacted the anti-trust statute to prevent immorality in contracts and business affairs. Congress has enacted the live stock sanitation act to prevent cruelty to animals. Congress has enacted the cattle contagious disease act to more effectively suppress and prevent the spread of contagious and infectious diseases of live stock. Congress has enacted a statute to enable the Secretary of Agriculture to establish and maintain quarantine districts. Congress has enacted the meat inspection act. Congress has enacted a second employer's liability act. Congress has enacted the obscene literature act. Congress has enacted the lottery statute above referred to. Congress has enacted (but a year ago) statutes prohibiting the sending of liquors by interstate shipment with the privilege of the vendor to have the liquors delivered c.o.d...." Shawnee Milling Co. v. Temple, 179 Fed. 517, 524 (1910). All these acts can be technically justified on the construction of the interstate commerce clause of the Constitution. Reference has been made in previous pages to the power of Congress over the mails and the power to prohibit the transmission of matter deemed injurious. See Ex parte Jackson, 96 U. S. 727 (1878); Ex parte Rapier, 143 U. S. 110 (1892).

[28] Hammer v. Dagenhart, 247 U. S. 251 (1918).

[29] Notice especially Veazie Bank v. Fenno, 8 Wallace 533 (1869); McCray v. United States, 195 U. S. 27 (1904); United States v. Doremus, 249 U. S. 86 (1919).

[30] Bailey v. Drexel Furniture Co., 259 U. S. 20 (1922).

[31] The Court referred to the Doremus case and said, "The court, there, made manifest its view that the provisions of the so-called taxing act must be naturally and reasonably adapted to the collection of the tax and not solely to the achievement of some other purpose plainly within state power." Bailey v. Drexel Furniture Co., 259 U. S. 20, 43 (1922). In the Doremus case this statement appears: "The act may not be declared unconstitutional because its effect may be to accomplish another purpose as well as the raising of revenue." United States v. Doremus, 249 U. S. 86. 94 (1919).

[32] Head Money Cases, 112 U. S. 580 (1884); Brushaber v. Union Pac. R. R. Co., 240 U. S. 1 (1916), and references. The sixteenth amendment "does not extend the taxing power to new or excepted subjects". Peck v. Lowe, 247 U. S. 165, 172 (1918). On the basis of this principle, taxes oh salaries of state officers and on income from state bonds would still be exempt from taxation. See The Collector v. Day, 11 Wallace 113 (1871). Metcalf v. Mitchell, 269 U. S. 514 (1926), discusses the subject. See specially Ibid., 522. The case holds that consulting engineers under special contracts are not officers.

[33] National Prohibition Cases (Rhode Island v. Palmer, etc.), 253 U. S. 350 (1920). See also Dillon v. Gloss, 256 U. S. 368 (1921). A federal district judge went so far as to declare the amendment had not been constitutionally adopted, because it was of such a character that it ought to have been ratified by conventions and not by legislatures. The Supreme Court, on appeal, paid no prolonged attention to this pretentious position: "The choice, therefore, of the mode of ratification, lies in the sole discretion of Congress." United States v. Sprague, 282 U. S. 716, 730 (1931). The main announcements of the Court are: the requirement of a two-thirds vote in Congress means two-thirds of those present; when a state is acting on the ratification of an amendment, a referendum provision in a state constitution is inapplicable; the amendment was within the power to amend reserved in Article V of the Constitution; concurrent power of Congress and the states does not enable either Congress or the states to defeat or thwart the prohibition, but only to enforce it by appropriate means; the period set by Congress for state action (seven years) was within congressional authority; the amendment became part of the Constitution when the requisite number of states had ratified, i.e., it did not wait upon promulgation by the Secretary of State.

[34] Leser v. Garnett, 258 U. S. 130 (1922).

[35] It is only necessary to remember the months after the defeat of the Federalists in 1800, the retiring attitude of Jefferson some months before his official retirement, and the holding of office by Buchanan four months after the election of Lincoln, to see what the practice involved. For the full text of the amendment, see the appendix.

[36] "The oft-repeated statement that the Federal Government is the greatest business enterprise in the United States needs no elaboration. Its truth, however, can be appreciated only by those who have had occasion to survey in detail the great variety and wide ramification of the functions performed by such establishments, for example, as the United States Veterans' Administration, with expenditures in recent years of about $1,000,000,000, or of such departments as the War and Navy Departments, expending together between seven and eight hundred millions per annum, or the Department of Agriculture, with annual expenditures which have varied in recent years from $150,000,000 to $300,000,000." C. H. Wooddy, The Growth of the Federal Government 1915-1932, p. viii.

[37] No way has appeared or is likely to appear whereby through court action the federal government can be prevented from making such appropriations as it sees fit. See Frothingham v. Mellon (Mass. v. Mellon), 262 U. S. 447 (1923), where a state and a private taxpayer sought to prevent the expenditures authorized by the so-called Maternity Act, which authorized appropriations to.be apportioned among such states as should apply for funds and accept and comply with conditions, for the purpose of reducing maternal and infant mortality.

[38] The Federalist, no. XVII.

[39] "The existence of a so-called 'twilight zone,' an ill-defined and hazy territory between state and federal authority, has offered undisturbed opportunity for the operations of the exploiter. Without infringing upon state autonomy the Progressive movement demands the illumination of the 'twilight zone.' It insists that the federal government must have liberty to exercise its function in behalf of the common welfare where the power of the individual state is shown to be insufficient." S. J. Duncan-Clark, The Progressive Movement, with an Introduction by Theodore Roosevelt, p. 32 (1913).

[40] In a speech made at Osawatomie, Kansas, on August 31, 1910. T. Roosevelt, The New Nationalism, pp. 27-28.

[41] Kansas v. Colorado, 206 U. S. 46, 89 (1907).

[42] The nature of the presidential office and its development have been briefly discussed in chapters XVII, XVIII, XXXII of this work.

Personae

Terms Defined

Referenced Works