Evening star., 1940-05-20
Coal Act
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Coal Act
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under review is beyond any power
granted to Congress"
The regulatory provisions are
clearly within the power of Congress
under the commerce clause of the
Constitution, Justice Douglas said.
These provisions are applicable only
to sales or transactions, or directly
or intimately affecting interstate
commerce. the fixing of prices, the
prescription of unfair trade prac-
tices, the establishment of mar
keting rules respecting such sales of
bituminous coal constitute regula-
tions within the competence of Con-
greSs under the commerce clause.
What is true of prices is true of
the attachment of other conditions
to the flow of commodity in in
terstate channels. There can be no
question that the provisions of this
act are an eXertion of paramount
Federal power over interstate COM
merce."
In the decision, which subjects
Sunshine to back tax payment of
SIS ,483, Justice Douglas referred to
the background of the first coal act.
declared unconstitutional because
of it's labor provisions.
Hughes and CardozO Cited.
THE ma jority of the court in that
case did not pass on the price fixing
features of the earlier act Justice
Douglas said. The Chief Justice
and Justice Cardozo. in separate
minority opinions. expressed the
view that the price-fixing features
of the earlier act were constitutional
We rest on their conclusions for sus-
tanning the present act
Declaring that there are limits
on the powers of the States to act
with respect to interstate industries
and that if the coal industry had
endeavored to stabilize the markets
Through rice-flxing agreements, it
would have run afoul of the Sher-
man Act the decision continued:
But that does not mean that
there is no mans land between
the State and Federal domains
Certainly what Congress has for
hidden by the Sherman Act it can
modify. 1t may do SO by placing
the machinery of price-fixing in
the hands of public agencies. 1t
may single out for separate treat
ment, as it has done on various
occasions. a particular industry, and
thereby remove the penalties of the
Sherman Act as respects 1t.
Congress Power Confirmed.
Congress under the commerce
clause is not impotent to deal with
what it may consider to be dire
consequences of laissez faire. 1t is
not powerless to take steps in miti-
CATION of what, in its judgment, are
abuses of cut-throat competition,
and it is not limited in its choice
between unrestricted self-regulation
on the one hand and rigid prohibi-
tionS on the other. The commerce
clause empowers it to undertake
stabilization of interstate industry
through a process of price fixing
which safeguards the public inter-
est by placing price control in the
hands Of its administrative repre-
sentative. That was the choice
which Congress made here"
Blood as Well as Ink"
The court added: The problem
OF fixing reasonable prices for BIZ
luminous coal cannot be differenti-
ated legally from the task of fixing
rates under the Interstate Com
merce Act and the Packers and
Stockyards Act"
Reverting to the history of the
former regulatory act, the decision
said that for a generation there
have been various manifestations
of the incessant demand for Federal
intervention in the coal industry ;.
1t said that the investigation pre-
ceding both the old and the new
acts brought about disclosures whicn
gave eloquent testimony" to Justice
Cardozo's view in the first coal case
that free competition had been de
graded into anarchy" Overproduc-
ton and savage competitive warfare
wasted the industry, it went on.
Labor and capital alike were the
Victims" the decision said. "Finan-
cial distress among operators and
acute poverty among miners pre-
vailed even during periods of gen.
eral prosperity. The history of the
bituminous coal industry is written
in blood as well as ink.
1T was the judgment of Congress
that price-f1xing and the elimina-
ton of unfair competitive practices
were appropriate methods for pre-
vention of the financial ruin, low
wages, poor working conditions,
strikes and disruption of the chan
nels of trade which followed in the
wake of the demorslized price struc-
lures in this industry. II the stra-
tegic character Of this industry in
our economy and the chaotic con-
ditions which have prevailed in 1t
do not justify legislation, it is din
cult to imagine what would"