Warren E. Burger: The Court will hear arguments first this morning in the United States against Lee. Mr. Wallace, you may proceed whenever you are ready.
Lawrence G. Wallace: Mr. Chief Justice, and may it please the Court, the Appellee in this case is a member of the old order Amish religious sect who employed other members of that sect on his farm and in his carpentry shop during the taxable years involved, 1970 through 1977. He did not withhold social security taxes from their wages or pay the employer's share of those taxes, and after an Internal Revenue Service assessment in 1978, he paid the taxes for one quarter of one year for an employee, and brought this suit for a refund, claiming that the tax as applied violated the free exercise clause of the First Amendment. The basis for this claim is the belief of the old Amish sect to which he adhered that the members are to care for their aged, their sick, and their unemployed, and do not need any form of social welfare benefits from outside their religious community, and that it is a sin either to accept social security benefits or to pay the social security taxes. The District Court upheld his claim that the tax was unconstitutional as applied, and the United States appealed to this Court.
Speaker: At the time he made the first quarterly payment, Mr. Wallace, what were his alternatives? Was he subject to a likely seizure or levying on his property?
Lawrence G. Wallace: Well, the ordinary enforcement procedures to collect the taxes would be utilized, Mr. Chief Justice, but of course this case has been litigated, and none of those procedures have been put into effect. The case was tried on a stipulation, and counsel have agreed that the amount of taxes owing will be agreed upon should the United States prevail in this case.
Speaker: Well, but his act at that time in paying presumably did not compromise his religious beliefs because he had no choice, no real choice. If he wanted to continue his business, he had to yield to the government's demand.
Lawrence G. Wallace: He at least was willing to make the payment. I can't really speak for whether that offended his religious beliefs. He made it under a claim of right to a refund, and perhaps that reconciled it with his belief.
Speaker: He is still claiming here today--
Lawrence G. Wallace: He is still claiming the right to a refund.
Speaker: --Mr. Wallace, in the face of that finding of the District Court that it was a sin not only to accept but also a sin to pay these taxes, can the Court go behind that?
Lawrence G. Wallace: Well, I don't--
Speaker: I mean, do we have to decide this case by accepting--
Lawrence G. Wallace: --We are not asking--
Speaker: --by accepting that holding, that it is a sin to pay as well as--
Lawrence G. Wallace: --We accept that holding, that that is his religious belief, and--
Speaker: --But you rely on the balancing aspect.
Lawrence G. Wallace: --We do, Mr. Chief Justice.
Speaker: But I gather that--
Lawrence G. Wallace: We do ask the Court to look behind that religious view.
Speaker: --Does that imply then that you don't question that to pay would seriously infringe upon his free exercise rights?
Lawrence G. Wallace: We don't agree with quite that formulation, Justice Brennan. We don't question that he in good faith and with sincerity believes that it would be a sin to pay the tax, and he is making--
Speaker: But nevertheless, nevertheless, to the extent that infringes upon free exercise rights, I gather the government's position is that the governmental interest, what, overrides? Is that it?
Lawrence G. Wallace: --That is our position.
Speaker: It has to give way to the governmental interest?
Lawrence G. Wallace: That this is not in the circumstances of a generally applicable tax protected by the free exercise clause.
Speaker: What I am trying to get at is--
Lawrence G. Wallace: They are... to pay a tax assessed on all persons--
Speaker: --What I am trying to get at--
Lawrence G. Wallace: --for an economic activity.
Speaker: --Mr. Wallace, wait, will you? Are you suggesting, then, that this is a strict scrutiny kind of analysis, and that the government interest under strict scrutiny prevails over the free exercise right?
Lawrence G. Wallace: We haven't really suggested a test of that kind. The Court has spoken in terms of a balancing test in the pertinent cases, looking toward the interest claimed under the free exercise clause and the governmental interest. I don't know that it is--
Speaker: Well, what is the test by which we determine that the free exercise right must give way to the governmental interest?
Lawrence G. Wallace: --Well, I am not sure that I can formulate it in an abstract way other than to use what the Court has used, that you examine the claim that is made under the free exercise clause, and the nature of the government's interest, and make a determination. This claim is quite different from many others that have been before the Court, and we have tried to describe some of those differences in our brief. I don't really think that the case can be answered with an abstract standard.
Speaker: Congress attempted to provide some relief for these people, did it not?
Lawrence G. Wallace: It did provide an exemption from the self-employment tax, which we have referred to in our brief, but it was very careful in providing that exemption to limit it only to the self-employment tax, and the committee report specifies that the committee did not want to go beyond that and compromise the principle that social security contributions are not to be a voluntary matter beyond that narrow area.
Speaker: On the constitutional point, though, if he believes it is a sin for him to pay himself, apparently he also believes that it is a sin for him to pay for workers who are now working on his farm.
Lawrence G. Wallace: Well, the claim does embrace the employees' share of the tax as well as the employer's share. Under the social security laws, both the employer and the employee are responsible for part of the tax, although as it happens in this case, since he did not withhold anything from the wages of the employees, he himself was responsible for the entire tax.
Speaker: Mr. Wallace--
Lawrence G. Wallace: He has to pay whether he withholds or not.
Speaker: --Do you think the exemption with respect to self-employed Amish runs afoul of the establishment clause?
Lawrence G. Wallace: We do not think so, Mr. Justice.
Speaker: Why?
Lawrence G. Wallace: Although there is admittedly some tension with it, but we think it is a permissible accommodation of values, of religious values that the government can make under a number of this Court's cases that do permit some area of legislative discretion in accommodating religious beliefs with the general requirements of the law, and indeed, we think that the exemption could be extended to the employment taxes if Congress saw fit to do so.
Speaker: But at present, does it work this way, that the exemption applies to an individual, but if he engaged or employed... how many people before the exemption would not be applicable?
Lawrence G. Wallace: It is not applicable to the employment relationship at all.
Speaker: So if he had a single employee, the exemption would not be applicable?
Lawrence G. Wallace: To the employment relationship.
Speaker: Yes.
Lawrence G. Wallace: It is still applicable to his own self-employment.
Speaker: Of course.
Lawrence G. Wallace: Even though it is not applicable to the wages that he pays to his employee.
Speaker: Mr. Wallace, perhaps you have stated it, but if so, I have missed it. What is the situation as to the employees here? Are they also old order Amish?
Lawrence G. Wallace: The stipulation so states, although it doesn't say how many there are. The record just doesn't show that.
Speaker: Would the case be different if they were not?
Lawrence G. Wallace: I think there would be less basis for the claim that there was a right to exclude them under the free exercise clause from social security coverage. Yes, Mr. Justice.
Speaker: Is it not true that some of the old order Amish have left the faith?
Lawrence G. Wallace: So far as I am aware--
Speaker: The record doesn't show this?
Lawrence G. Wallace: --The record does not show this. The committee report which Congress issued and that it enacted the exemption for self-employment in 1965 did emphasize that the proposed exemption in their belief must be on the basis of individual choice to exclude all members of a religious group from social security coverage would not take account of the variances in individual beliefs within any religious groups, and would deny social security protection to those individuals who want it. Among the old older Amish, for example, there have been some indications of a change in attitude towards social security, particularly among the younger people. Some members of the old order Amish who have become eligible for social security benefits have claimed the benefits.
Speaker: Is this Report Number 213?
Lawrence G. Wallace: That is Number 213. However, nothing in the record of this case indicates anything of this kind.
Speaker: Even though you may not have made it as sharply as I am about to state it, I took the sum and substance of your position in the brief to be that the government of the United States can't run a nationwide program like tax collection or social security and one like this if there are these ad hoc exceptions, except as Congress explicitly makes them. Is that pretty close to your position?
Lawrence G. Wallace: Yes, it is, Mr. Chief Justice.
Speaker: Well, then, how do you distinguish Sherbert against Verner, or the Thomas case of last year?
Lawrence G. Wallace: Well, we discuss those cases in our brief.
Speaker: I realize you do.
Lawrence G. Wallace: They involved much more serious problems for the claimant of the free exercise right, choosing between, in the Sherbert case, observance of one's Sabbath or one's economic livelihood, and in the Thomas case something very comparable, because of the loss of employment that was involved there, in order not to perform something that one believed could not be performed. Here, the Amish, who do not want to be within the social security program, of course, do not have to accept benefits, and there is no indication that they believe that the furnishing of benefits to others in the national community who are covered by the program is in any way in conflict with their beliefs. Their claim really is that there is, as they see it, an implication in their paying the tax that somehow they will become eligible for the benefits, and that indicates the sin of not planning to take care of their own community. But that is, with all respect to their belief, a construction that they choose to put on the payment. So far as Congress is concerned, this is just a generally applicable tax on a commercial relationship, and the employment relationship for engaging in commercial activity.
Speaker: Well, couldn't you say the same thing about Thomas last year?
Lawrence G. Wallace: Well, in the Thomas case, he was performing work that was contrary to his religious belief, and by denying him unemployment compensation rights for giving up the job for that reason, there would be economic pressure on him to engage in work that is contrary to his religion. I realize--
Speaker: I take it, Mr. Wallace, you suggest here that they can pay the taxes; that doesn't stop them from continuing to support their own people.
Lawrence G. Wallace: --That is correct, Mr. Justice.
Speaker: Which is the distinction from Sherbert and Thomas that you make.
Lawrence G. Wallace: It is the essence of the distinction that we make.
Speaker: They don't lose what Thomas and Verner, or Sherbert, or whoever it was, would have lost.
Lawrence G. Wallace: Yes.
Speaker: But that suggests that in the scale of values the economic one is the top one rather than the religious belief of the particular claimant.
Lawrence G. Wallace: Well, all religious beliefs as beliefs stand on the same footing under the Constitution. A religious group might believe that it is a sin to pay any tax to secular authority, and that as a belief would stand on the same footing as the interpretation of social security tax payments that this group chooses to put on those payments, but that doesn't mean that there is a constitutional right to act on those beliefs and to refuse to pay the taxes that are levied on non-religious grounds generally in the community on the basis of commercial activities.
Speaker: Mr. Wallace, may I ask, is there anything in this record that suggests that the Amish would stop supporting their own people if they lost this case?
Lawrence G. Wallace: Not at all. Not at all, Your Honor.
Speaker: Nothing in the stipulation or otherwise?
Lawrence G. Wallace: Not at all, and--
Speaker: Is there anything to prevent them from having all of the social security or the other payments of this kind come back to a fund, the same kind of a fund that the Amish use to take care of their needy, in other words, so that it wouldn't come back to assist any individual except through the group operation?
Lawrence G. Wallace: --There is nothing in the law, Mr. Chief Justice, that would prevent a member of the Amish faith who is eligible to receive social security payments from receiving those payments and paying them over to a general fund in the community to care for members of the community. There may be an impediment to doing that in his religious faith, but there is nothing in the law that requires him to receive the benefits at all if he chooses not to receive the benefits. This is a right protected by the free enterprise clause.
Speaker: Mr. Wallace, I would like to ask you to identify what the compelling interest is of the government in requiring the Amish to pay into the social security system under the stipulated facts, which indicate that the Amish will not be withdrawing from the fund, and there is very little in the record that I can find that would focus on the real impact on the government of allowing them not to pay.
Lawrence G. Wallace: Well, Justice O'Connor, we don't really, as we view the case, start from the standpoint that we need to show a compelling interest, but however one characterizes that, the interest is really one set forth in one of the classic opinions of Justice Stone, writing for this Court in one of the cases in Volume 301 of the U. S. Reports that upheld the constitutionality of the Social Security Act itself, and that established that the payments as Congress characterized them are taxes, and not insurance premiums, as is sometimes confused, and on Page 28 of our brief, we have set out the key paragraph of that opinion, and I would like to, if I may, turn our attention to it, because it seems to me to go to the heart of this case. We don't really feel that the tax, that Congress's power to tax need be justified in terms of whether the Amish will be withdrawing benefits from the fund, the general fund that is collected, a tax as at that time Mr. Justice Stone said for the Court, "is not an assessment of benefits. " "It is a means of distributing the burden of the cost of government. " "The only benefit to which a taxpayer is constitutionally entitled is that derived from his enjoyment of the privileges of living in an organized society, established and safeguarded by the devotion of taxes to public purposes. " "Any other view would preclude the levying of taxes except as they are used to compensate for the burden on those who pay them, and would involve the abandonment of the most fundamental principle of government, that it exists primarily to provide for the common good. " There are many contributions made in the community at large that contribute toward the maintenance of the way of life that the Amish have fashioned, and that under Wisconsin against Yoder they have a constitutional right to maintain as they choose to fashion it, but the fact is, it is not only through their efforts that that way of life can be maintained. There are others in the community in general who are willing, for example, to train themselves in the advanced technology that is needed to defend the Country in today's world, and to protect the constitutional form of government which provides for the free exercise of religion, and others who are willing to serve in the armed forces, et cetera. The fact that the free exercise clause confers upon a community such as the Amish the right to maintain the way of life that they choose to fashion for their community does not negate the obligations they have to the larger community, including the obligation to pay generally applicable taxes on commercial activities.
Speaker: How does this square with Thomas of last year?
Lawrence G. Wallace: Well, I realize that in your view, Justice Rehnquist, it probably doesn't.
Speaker: I don't think it does, but I mean taking the majority in both cases.
Lawrence G. Wallace: Well, I think the burden involved in Thomas, as Justice Brennan pointed out, was of greater magnitude, and here, there is nothing in the payment of taxes that prevents the Amish from maintaining their system of providing for the social welfare of the members of their own community through their own efforts, which is their basic religious teaching, even though the--
Speaker: The Court... were you finished?
Lawrence G. Wallace: --I am sorry, Mr. Chief Justice.
Speaker: About 25 years ago... I could not identify the cases... was there not a series of cases of Jehovah's witnesses and other groups, perhaps Quakers, who are strongly opposed to war in any form, who sought to have the aggregate amount of the income taxes levied on them segregated between that part which went to the maintenance of the military and the civilian? I think the Court did not decide any of them, but regularly certiorari was denied in those cases, for whatever that is worth.
Lawrence G. Wallace: That is correct, Mr. Chief Justice. One of the most prominent of those more recent cases in which certiorari was denied in 1970 is a case in which we have set out a quotation in our reply brief, on Page 3, called Autenrieth v. Cullen. In that case a large number of people with very serious, they claimed, conscientious scruples against the activities that the government was engaged in in Vietnam wished not to pay the share of their income taxes that would be attributed to supporting that activity, and the Court of Appeals for the Ninth Circuit rejected that claim, and we have quoted a passage of its opinion, and this Court denied certiorari. There are other cases collected in our principal brief. In a way, this is a more serious claim of conscience than we are involved in in this case, and I don't mean in any way not to respect the claim that is being made here, but there is no claim in this case that the religious views of the Amish are offended by the use to which these moneys will actually be put, to take care of the social welfare problems of other persons in the general community, whereas in many of these other cases in which people have claimed a conscientious scruple against paying taxes, they found it contrary to their conscience to have the money spent the government was planning to spend the money. Here, the money need not be spent in a way that would offend their religious beliefs, but it is the payment of the tax itself which they construe to be a sin. Now, I do think it is important to keep in mind that while the social security laws do use the word "insurance" and use a trust fund concept, the payments that are involved here have from the beginning been recognized to be taxes and not insurance premiums, as they are sometimes loosely called. This may be very obvious on the facts of this case in which the payments are due from the employer but the credit is to go toward the account of the employee, for himself or his survivors. Nonetheless, there can be some confusion about this. On Page 16 of the Appellee's brief he refers to this as the payment of insurance premiums. Any possible doubt on this subject was dispelled by a decision of this Court not cited in any of the briefs which I want to call to the Court's attention, and I called it to counsel's attention, Fleming against Nester, decided in 1960, 363 US 603, which made it clear that there is no accrued property right under the system, that it is, as Congress provided, in a savings provision subject to change and adjustment through the normal exercise of the Article I legislative powers. From the beginning, the cases have construed the payments due as taxes, as Congress characterized them. I would like to reserve the balance of my time, please.
Warren E. Burger: Very well. Mr. Caiazza?
Francis X. Caiazza: Caiazza. Mr. Chief Justice, and may it please the Court, after listening to the questions asked by the Court and the government's responses thereto, I think I would find it necessary really to depart from the prepared argument that I have made, because I feel that in arguing a question involving... excuse me... questions involving the freedom of religion certainly is a question that has to come from the feelings of the individual practitioner who is arguing the question. Perhaps it is not permissible and proper for an attorney to become so personally involved with a particular issue. Maybe I have overstepped my bounds. But I think the Court has to remember in this case that religion is something like beauty. Beauty is in the eyes of the beholder. I think that religion is the same thing. I think religion also has to be in the eyes of the believer. Religion means different things to different people. To some people, it may seam go to church on Sunday, or the Sabbath. Perhaps it has a social connotation to other people. But to some people the basic and the underlying principle of religion is the salvation of one's soul. That basically is what the Amish people are about. It is pretty hard, really, to describe the Amish people without living with them, without going to see them, visiting their homes, talking to them, and I think by doing that you perhaps gain an insight into what the Amish people are about.
Speaker: In the Thomas case last spring, didn't the Court say rather clearly that the judges can't get into the business of parsing out the doctrinal differences within a particular faith?
Francis X. Caiazza: That is true, Mr. Chief Justice, but I think that is very applicable here, too, because I think in this particular case, what the government has said, that it is really a sin, they admit that it is a sin on behalf of the Amish people to pay into the system, but then what they go on to do is to say, well, that is not that great of a sin. The Amish people, pure and simple, live by the Book of Timothy. The Book of Timothy, of course, paraphrased, says, if you don't take care of your own neighbors, you are worse than an infidel. That is the basic underlying principle of this particular case. That is the belief of the Amish people.
Speaker: But isn't this whole social security system an organized way for a country of 200 million people to try to take care of their neighbors in an organized, institutionalized way?
Francis X. Caiazza: That is true, but there are exceptions to that. As an example, Federal employees are not part of the social security system. They have their own system to take care of themselves. The Amish have their own system, which is the best system I have ever seen. They take care of their own. If they have tragedy, they are there to take care of them. About two weeks ago--
Speaker: Counsel, does the record show that any employees of these Amish were not Amish?
Francis X. Caiazza: --No, all of the employees of Mr. Lee were members of the old order Amish.
Speaker: Well, of course, the stipulation doesn't say that in so many words, does it?
Francis X. Caiazza: No, it does not, but there were no... I think that it does. I think the stipulation states that all of the employees were members of the old order Amish. Mr. Lee did not employ anybody who was not a member of his own sect.
Speaker: Mr. Caiazza, I gather from what you have said that if you lose this case, the Amish will not stop following their religious principle which, as you say, underlies this whole belief of taking care of their own.
Francis X. Caiazza: They will not... right.
Speaker: They will continue.
Francis X. Caiazza: They would continue to take care of their own. There is no question about that.
Speaker: Well, is there anything in the record at all that indicates that the payment of these taxes in any wise actually burdens their ability to take care of their own?
Francis X. Caiazza: No, but I think it burdens their religious belief. I think that is the issue. Again, they do consider it a very serious sin to pay into the system, because what they are doing is denying their faith in the destiny of God. They believe very frankly in the destiny of God, that God will--
Speaker: Does that suggest that it is a sin of such consequence that entirely without reference to their ability to take care of their own, it is an offense to their religion to pay--
Francis X. Caiazza: --Yes. I think... I feel very strongly about that. I think that once a particular group of individuals such as the Amish establish the fact that certain conduct is sinful, and that opinion is a sincere opinion such as the Amish people have, I don't think this Court or the government or anybody else can question the sincerity of that belief, and attach a sin to it as being mortal or venal in nature.
Speaker: --Well, I didn't understand that the government was questioning at all, and certainly I do not, the sincerity of the belief.
Francis X. Caiazza: They weren't questioning the sincerity of the belief, but they are saying the sin would simply be an incidental sin. It wouldn't be that great.
Speaker: What about the cases that we discussed with Mr. Wallace? In the Ninth Circuit case, it was really a political belief. They were... the objectors were objecting to a particular war. But in the earlier cases, where the Court declined to review similar holdings, there were religious beliefs asserted against all wars. Now, that is certainly a profound belief, is it not?
Francis X. Caiazza: I think it would be.
Speaker: And yet these people in these religious groups were required to pay their share of the cost of the World War Two and all other military activities. How do you distinguish that, if you think you need to distinguish it? Because the Court didn't decide it. We merely decided not to review it.
Francis X. Caiazza: I think I do need to distinguish that, and I think you have to look at the compelling state interest. I think the compelling state interest in those instances was such different than the compelling state interest here. The government has said that the compelling state interest is the broad participation of individuals in the social security laws. I don't think that... that is what the compelling state interest as far as--
Speaker: But you do them apparently concede that the government interest may be such in a particular case that would override the free exercise infringement?
Francis X. Caiazza: --Very definitely I do.
Speaker: So that it is a matter of... you concede it is a matter of balancing the competing interests?
Francis X. Caiazza: Yes. I think very definitely.
Speaker: And you simply say it should be balanced in your favor here.
Francis X. Caiazza: Yes, I do.
Speaker: What about the Federal income tax?
Francis X. Caiazza: I think the Federal income tax is different. I think that the argument has been made--
Speaker: If it were a sin under some religious beliefs to pay the income tax, would you say that the income tax could nevertheless be collected?
Francis X. Caiazza: --Yes. Again, I think you have to distinguish again between social security and the federal income tax.
Speaker: And the property tax?
Francis X. Caiazza: The Amish people pay all taxes. They pay income taxes, they pay all property taxes, they pay every tax you and I pay.
Speaker: Are any of those deemed... Is the payment of any of those taxes deemed to be a sin?
Francis X. Caiazza: No.
Speaker: Mr. Caiazza, suppose we come to the day, as from reading the newspapers we may, when we have to fund the social security system in part, at least, out of general income taxes? What then would be the Amish position?
Francis X. Caiazza: I think that is, of course, a different case than we have here, but I think that... again, I think they would have to take the position that it would still be a sin. I think if that happens, I think you have the compelling state interest shifting.
Speaker: You are familiar, I know, with the polygamy decisions and the peyote decisions and the like--
Francis X. Caiazza: Yes, I am.
Speaker: --where because of their illegality, as I recall it, those cases held that free exercise was not protected.
Francis X. Caiazza: Yes, sir.
Speaker: How do you distinguish those cases? Non-payment of FUTA and FICA taxes is a crime, isn't it?
Francis X. Caiazza: That's true.
Speaker: It can be a crime?
Francis X. Caiazza: Yes, it can be.
Speaker: How do you distinguish those old cases?
Francis X. Caiazza: Because I think again, we have to again, I think, look at the compelling state interest. I think that the crises such as you have cited, if they were permissible under the laws of our country, I think it could lead to chaos. I don't think that is true as far as the Amish people are concerned, when you consider the social security tax and the number of Amish people that you have in this country.
Speaker: How can you say there would be chaos if people practiced the Mormon faith as it was some decades ago, where it was a sin not to take several wives, for example? Would that cause chaos?
Francis X. Caiazza: Well, maybe I shouldn't use the word "chaos", but what I--
Speaker: Or say they smoke the peyote in a ritual periodically. Would that cause chaos if it were permitted?
Francis X. Caiazza: --No, I don't think it would cause chaos, and I would like to back up on that statement, but I think that... certainly I think that the result of the practice of polygamy in this country would be much different than the law not requiring the Amish people to pay into the social security system.
Speaker: Does your case turn on the fact that they will not participate in the benefits, do you think?
Francis X. Caiazza: They never... they do not participate in the benefits.
Speaker: Well, how can you guarantee that the employees might not at some time be non-members of the sect or might leave the sect before they become eligible for benefits?
Francis X. Caiazza: They may leave the sect--
Speaker: Because there are people who leave the faith, are there not?
Francis X. Caiazza: --Yes, there are, very definitely. There are people that leave the faith. But I think when you read Mr. Chief Justice Burger's opinion in the Yoder case, he alludes very clearly to the fact that the Amish children in the Yoder case had to he protected, that if they went to school beyond the eighth grade in that particular case, that they would be taught the ways of the world, and I think the same thing is true here as far as... the same reasoning applies as far as the social security is concerned. If you make social security payments eligible, if you make the Amish people eligible to receive social security, that is there for them to receive, they may receive it and then deny their faith. That is what some of the older Amish people are concerned about, and I think rightly so.
Speaker: In other words, the taxpayer here is concerned about protecting his employees from the temptation of accepting welfare benefits later on?
Francis X. Caiazza: Yes, I would think so, and I think that same reasoning applies in the Yoder case, as far as the temptation of students going to school beyond the eighth grade, and I think that is what the parents in Yoder were concerned about, and that is what the Amish employers are concerned about--
Speaker: What would happen if another religion pops up? We would have to change again, wouldn't we?
Francis X. Caiazza: --I don't think that is a concern. If another religion--
Speaker: Why not?
Francis X. Caiazza: --If another religion such as the Amish popped up, I think the same reasoning would apply.
Speaker: I didn't say such as the Amish. Another religion would pop up and say, it's a sin to pay income tax.
Francis X. Caiazza: I think that the Amish people date back--
Speaker: I am not talking about old.
Francis X. Caiazza: --Well, I--
Speaker: They would say, we date back, too.
Francis X. Caiazza: --Yes, they would date back, and that same reasoning could apply.
Speaker: And we would have how many different tax systems in this country?
Francis X. Caiazza: I just don't think that that--
Speaker: Well, isn't everybody is striving for a uniform tax system.
Francis X. Caiazza: --I can't see where that is a reality in this particular case, because I don't think--
Speaker: Why isn't it a reality if we say, you are just like everybody else?
Francis X. Caiazza: --Because I think that the Amish people predate back to the 16th century in Switzerland. They came to this country for religious freedom. They have established this history from the 16th century.
Speaker: Didn't some other people come here for religious freedom, too?
Francis X. Caiazza: I understand that, but I think that the Amish people can predate their history back to the 16th century. If there is another religious faith--
Speaker: You are not asking that the Amish people be given a preferred status under the First Amendment, are you?
Francis X. Caiazza: --No, I am not.
Speaker: But certainly the Amish and the Mormon faith both go back a long way in their belief that a practice proscribed by the Congress was illegal.
Francis X. Caiazza: That's true.
Speaker: And nonetheless, this Court sustained the Congressional action.
Francis X. Caiazza: Yes. I think again if we are going back to the compelling state interest, I think that is what is important here. I think we have to look at the compelling state interest, and you have to, I think, ask your question whether or not the state interest is justified. In my opinion, it is not justified in this particular case when we look at the Amish payment into the social security system.
Speaker: How do we decide whether a compelling state interest is justified or not? Do the nine of us just get in a room and flip a coin?
Francis X. Caiazza: Well, I think you have to look at what the purpose of the social security system is. I think this is where the compelling state interest comes into play. The Amish people take care of themselves. I think the compelling state interest is whether or not the Amish people as a group have the means to care for themselves. They have taken care of that compelling state interest themselves. I think that is what is important. They do have a system whereby they take care of their older people, they take care of their younger people, their sick people. They do it themselves. That is the compelling state interest, I think. Can they take care of the situation themselves? They have done that since the 16th century. They have their own social security system. The compelling state interest is, in my mind, anyway, as far as the Social Security Act is concerned, is to take care of older people, aged people, people that are disabled. They do that themselves. They have taken care of the compelling state interest themselves with their own actions and by their own beliefs based upon their belief in God and the destiny of God.
Speaker: I take it what you are saying to us is that they have their own little social security system and insurance within their own church organization.
Francis X. Caiazza: They do.
Speaker: Well, now, what is to prevent them from having all the returns which came to individual Amish paid into that fund? Would that be regarded as tainted money, because it has gone into the government and back into the Amish fund?
Francis X. Caiazza: I would think that it would be, because I think that what they are doing by paying into the system is denying their belief in the destiny of God. That is what is important.
Speaker: Well, when they get it back, haven't they washed that out?
Francis X. Caiazza: They don't really take care of each other, though, by the use of moneys. What they do is, they take care of each other by the use of their physical labor.
Speaker: They must use money, too, I would think.
Francis X. Caiazza: They definitely do. Of course need money, like anybody else, An order to subsist, but I think that the... I think that the important situation is the fact that when they do pay into the system, what they are doing is denying their belief that their future is guided by the destiny of God.
Speaker: Mr. Caiazza, I am not clear yet whether you would take the same position you are taking if the employees were not Amish. Would it still be a sin to pay the tax, the social security tax?
Francis X. Caiazza: If the employee of Mr. Lee was not Amish?
Speaker: Correct.
Francis X. Caiazza: All right. The employer, of course, has his half to Pay and the employee has his half to pay.
Speaker: Yes. So would your argument still be that it is a sin to pay the tax?
Francis X. Caiazza: I think it would be a sin to pay the employer's half. It would not be a sin to pay the employee's half. As a matter of practicality, the Amish people just employ old Amish. They are a very close-knit community. They--
Speaker: But it would be your position that even if non-Amish employees were hired, that it would still constitute a problem?
Francis X. Caiazza: --Yes, it would.
Speaker: Now, would that not in effect mean that the government is running into establishment clause problems, and is in effect favoring the Amish and enabling them to compete in a manner that other people don't have to contend with?
Francis X. Caiazza: Of course, there is a lot of tension between the establishment clause and the free exercise clause. I think when you consider the number of Amish people there are in this country, I think when you consider their general practices of Amish people working together and not employing members who are not members of the old order Amish, I don't think you really run into that question. If the situation did arise whereby an Amishman did hire an individual who was not a member of the Amish faith, yes, you would have a problem, but as a matter of practicality, that just does not come up because they are a very close community. They stay within their own bounds.
Speaker: Wouldn't you, have a similar problem of larger magnitude if the government chose to tax, say, the wine that people of Jewish faith use in their religious rituals, or the people of the Christian faith use in their religious rituals?
Francis X. Caiazza: If you would tax the wine that they use?
Speaker: Yes.
Francis X. Caiazza: I really don't know how to answer that question. I would say that, yes, were taxes that was placed upon the wine that, let's say, was used at a Catholic mass. I would not know the reason for legislation such as that, but I think that you could run into the same problem if there were taxes placed upon the wine. Perhaps the problem becomes more paramount if the Catholic priest couldn't buy the wine because of the tax. I think you would run into a problem there. But if he could still purchase the wine, I can see nothing wrong with that.
Speaker: Even though it is heavily taxed?
Francis X. Caiazza: Yes, which it is, at least where I come from.
Speaker: Counsel, many people think it is immoral to fund abortions from the Medicaid component of social security. Do you think they would have the same right that you are contending for here today?
Francis X. Caiazza: Certainly they would have the same right to present their case. I haven't really thought about that in great detail. I would have to give you a quick answer. I would say yes, they would have that right.
Speaker: They would have the same right.
Francis X. Caiazza: Yes, to present their case.
Speaker: Quite a few people entertain that view.
Francis X. Caiazza: I would hate to comment myself on what direction I would go in, but I would certainly think that they would have the right to present that issue, but again I think we get back to the compelling state interest.
Speaker: It would have a devastating effect on the social security tax, at least on the Medicaid component, if that view prevailed, wouldn't it?
Francis X. Caiazza: Yes, sir. I realize that probably the greatest problem with this case is the fact that we are dealing with taxes. Of course, social security, I feel, in my mind, is more of an insurance than a tax. Of course, the name of the Act is the Federal Insurance Contribution Act. It is set up in a trust fund, and I think that the moneys are distributed basically the same way that insurance carriers distribute annuity funds.
Speaker: What about that old decision of Justice Stone? Wrong?
Francis X. Caiazza: Well, I would have to say that--
Speaker: It was wrong.
Francis X. Caiazza: --Of course, that does present problems, but I think that again--
Speaker: Well, Fleming is against you, too, on that point, isn't it?
Francis X. Caiazza: --Yes, sir.
Speaker: That is wrong, too. Right? You say that is wrong, too?
Francis X. Caiazza: I would say, yes, in my opinion, it is.
Speaker: Well, then, just to make it clear, you do take the position that if social security were financed out of general revenues, that you could make the same argument about the regular income tax?
Francis X. Caiazza: I don't really think so. I think if social security was financed out of general revenues, I think your compelling state interest would be different. Social security funds are set aside. Many of the Amish people are against many social welfare programs that are really financed by general revenues which come from income tax which they pay, but I don't think that it would be fair or proper to place on the government the responsibility to distinguish where everybody's tax dollar goes on a dollar by dollar basis. That is not true as far as the Social Security Act is concerned. The money goes into the system and is paid out of the system.
Speaker: You are saying the legal question will be different, but would it not be equally a sin for the Amish to pay income tax if the income tax were used to finance welfare programs that would be available to some members--
Francis X. Caiazza: Yes. I think... I think that it would also be... it also could be a sin, but I think again--
Speaker: --Could be? It would be, if I understand you.
Francis X. Caiazza: --It would be a sin, but I think you get back again to the compelling state interest.
Speaker: Then you are saying the governmental interest would override.
Francis X. Caiazza: It would override it. That is my position. I forgot where I was.
Warren E. Burger: Very well. Do you have anything further, Mr. Wallace?
Lawrence G. Wallace: I just would like to point out Footnote 11 of our brief, which shows that we long since have reached the point that Mr. Justice Brennan posed in a question where federal funds out of the general revenues are being used for social welfare programs, such as the aid to families with dependent children program, but also they are being used for a supplemental program within the Social Security Act itself that we have documented there. Other than that, we will rest on our brief, unless there are further questions.
Warren E. Burger: Thank you, gentlemen. The case is submitted.


William H. Rehnquist: We'll hear argument first this morning in No. 90-906, Metropolitan Washington Airports Authority v. Citizens for the Abatement of Aircraft Noise. Mr. Shapiro.
David L. Shapiro: Thank you, Mr. Chief Justice, and may it please the Court: This case involves a challenge to the constitutional validity of the Board of Review created as part of the administrative structure under which Washington Dulles and Washington National Airports have been leased by the Federal Government to an Airports Authority created by joint action of Virginia and the District of Columbia. The problem in this case, and it is a novel one, arises from the fact that Congress made it a condition of the lease that the Airports Authority create a Board of Review, that this Board of Review have veto power over certain significant actions of the Airport Authority, and that the Board of Review shall consist of Members of Congress to be selected by the Airports Authority from lists to be furnished by the Speaker of the House and the President pro tem of the Senate. The problem was addressed by the court of appeals after holding that the controversy was justiciable, and the court of appeals made essentially two determinations. First, that the Board of Review was exercising Federal power and that its constitutionality had to be analyzed on that basis; and second, that when it was analyzed on that basis, its existence, its authority, and its composition violated the principle of separation of powers. We contend that the court of appeals was wrong on both scores. First, and very significant to the analysis, we contend that it was wrong in concluding that for purposes of separation of powers analysis the Board of Review was exercising Federal power. The authority of the Board of Review derived from the joint action of Virginia and the District of Columbia in accordance with Federal conditions that were laid down in the act. Secondly, we believe that the conditions laid down in the act, although they do raise significant separation of powers questions in the unusual circumstances of this case, do not violate that basic separation of powers principle. If we may first address the rationale of the court of appeals, we note that it is at best only half-heartedly defended by the respondents. We think that choice was correct, that the court of appeals' rationale was wrong. The Board of Review is not created by Federal law. The Board of Review was created independently by the joint action of the State of Virginia and the District of Columbia in accordance with conditions laid down by Federal law. But Virginia and the District of Columbia were not coerced into creating that board any more than South Dakota was coerced into raising the drinking age to 21 as a condition of receiving Federal funds. Indeed we believe that the inducement, which admittedly did exist, was probably a good deal less than in that case and than in the case of Steward Machine Company against Davis.
Sandra Day O'Connor: Mr. Shapiro, by the same logic I suppose you would be... you're defending an effort by Congress to structure some kind of board of review with effective veto power, as this board has, over, for instance, the Federal funding of aid to the States for transportation or health services or welfare benefits, or anything else that the Federal Government provides money for. I mean, that would be your theory, and it would be a means by which the Congress could in effect have a veto exercised by members of its appropriate committees.
David L. Shapiro: Your Honor, we believe that this branch of the analysis doesn't solve the problem. It only poses the question. That is we think that the fact that the board itself was not created by Congress leaves a difficult constitutional analysis--
Sandra Day O'Connor: Well, Congress certainly had a gun pointed at the heads of Virginia and the District of Columbia, which wanted to establish an airport authority, and Congress said fine, you can do it but you're going to give us the veto in effect.
David L. Shapiro: --But we believe, Your Honor, that in terms of this Court's analysis and in terms of practical realities it was an offer they could refuse. That is it was not the kind of coercion that this Court has said literally destroys the independence of the State actor. Now, as I said, we believe that that simply poses the constitutional issue. We have tried to explain in our brief that the constitutional issue that is posed by these conditions is a very difficult and serious one.
Antonin Scalia: Why does it just pose it, Mr. Shapiro? If you say that there is no Federal power being exercised here, isn't that an end of the separation of powers problem?
David L. Shapiro: Well, there are... there are two possible conceptual approaches to this, Your Honor. One is the one you just suggested, that is taken I think perhaps by the petitioner, to say if it's done by the States and if they weren't coerced, that's the end of it. The respondents take the opposite conceptual approach and say if Congress has attached this condition, then Congress is asserting itself in a way in which it is not allowed to by the Constitution.
Antonin Scalia: Well, but there... which is to say that there is Federal power being exercised. But you are contending that there is no Federal power being exercised. And if there is no Federal power being exercised, that's the end of the thing, isn't it?
David L. Shapiro: Well, the Federal power takes the form of a condition. We see the question as being the question whether the Federal power in the form of a condition is an unconstitutional condition because of its implications for the separation of powers.
Antonin Scalia: So you say there is Federal power being exercised in the form of a condition.
David L. Shapiro: By Congress, yes.
Antonin Scalia: Oh. Well, I thought you were saying there was no Federal power being exercised.
David L. Shapiro: No, I'm sorry, Your Honor. I was saying that we think the court of appeals was wrong in saying that the Board of Review is exercising Federal power in the actions that it takes, that the Board of Review effectively is a Federal agency and has to be analyzed as such. If that were true, it seems to us clear that it would violate both the incompatibility--
Antonin Scalia: Well, I mean, nobody contests that the statute that Congress passed is an exercise of Federal power. Is that all you're saying? That's the only Federal power, the statute?
David L. Shapiro: --That's correct. And the granting of the lease by the Department of--
Antonin Scalia: Well, Congress certainly had the power to pass the statute.
David L. Shapiro: --Yes, it did. Yes, it did.
Antonin Scalia: Well, then that's the end of the case. The Federal power involved... the only Federal power involved, you tell us, was the statute. Congress certainly had authority to pass that. There is no Federal power involved in the exercise by the board. What is left?
David L. Shapiro: I think what is left is the question that Justice O'Connor raises about whether or not Congress may properly use conditions like this attached to Federal statutes as a way of effectively usurping executive authority.
Antonin Scalia: But it's not... that would be a valid argument if they were using the condition in order, unconstitutionally, to exercise Federal power. But you're telling me that at the end of the rainbow there is no unconstitutional exercise of Federal power. So therefore it can't be an unconstitutional condition because there is nothing unconstitutional about it. Congress passed a statute, which it can do, and this board is not exercising Federal power. Where is the unconstitutionality?
David L. Shapiro: We... well, what we are concerned about... first of all we believe that in this case what exercise of Federal power there was did not violate the Constitution. But change the case, for example, to a case in which Congress had reserved the authority to appoint members of the board. Then of course there would be the additional exercise of Federal power involved in the appointment, or Congress had reserved the authority to remove members of the board. Now, one of the arguments that is suggested by the court of appeals, and that I think is adopted by the respondents, is that there is in this case additional exercise of Federal power in the form of a kind of de facto appointment and removal power existing in Congress. For example, it is suggested that, by removing members of the Board of Review from relevant congressional committees, Congress can effectively remove them from their position of authority in State office. So that would be an additional exercise of Federal power.
Antonin Scalia: Just to finish up your response to Justice O'Connor, do I understand that the Government's only problem, the executive branch's only problem with this statute is a federalism problem, not a separation of powers problem? It's just the unconstitutional condition because it impinges on the States. Is that the only problem the executive branch has with this?
David L. Shapiro: No. No, it is not, Your Honor. We do, in addition, have a separation of powers problem. We think that problem is answered in the context of this case. We don't think it can be answered in all of the hypotheticals that Justice O'Connor raises in her question, because we think that if Congress were to use this condition device as a way of putting Members of Congress into essentially executive roles in the playing out of Federal programs at the State level, that that would be a usurpation of executive authority and interference with the executive role.
William H. Rehnquist: Well, Mr. Shapiro-- --Does the Government take a position as to whether the Members of Congress who are appointed to this... these State, or State boards, or this board set up by the States, whether their term on the board survives their term on the committee in question?
David L. Shapiro: Yes, Your Honor. We believe that the requirement that the members of the Board of Review be both Members of Congress and in most cases members of certain relevant committees do constitute solely qualifications for appointment. We think that is clear from the structure of the statute, that subsection 1 refers to appointment of 2456(f). Subsection 2 refers to fixed terms of office, which in our view do not require that, once appointed, those members of the board either continue to be Members of Congress or continue to be members of the relevant committees. Incidentally, the only time, as I understand it, that that has come up, when Senator Kassebaum did cease to be a member of the relevant committee, she did resign from the board. But our view under the statute is that that's not required.
Antonin Scalia: I suppose if you interpreted the Constitution that way, a senator who has to be a citizen to be elected, should he abandon his American citizenship during his 6-year term, could continue to serve, because it's only a qualification for taking the office and not for continuing in it?
David L. Shapiro: I... I don't know whether the language of that is identical to the language here. I think the language here is clear--
David H. Souter: But Mr. Shapiro, even on that assumption, does that really answer the issue that Justice O'Connor raised? And that is, let's assume there may be incidents in which individuals may continue to serve though they don't remain Members of Congress or of the committees. There's still a problem to be answered, and that is that, as you put it, there is a, appears to be a de facto exercise of Federal power over... in this case over the actions of a non-Federal board of directors. Congress is still de facto being allowed to exercise power, isn't it?
David L. Shapiro: --We don't think with respect to removal that it is, Your Honor. That is we don't think Congress has either de jure or de facto removal power.
David H. Souter: No, but with respect to the authority that they exercise in their approval or disapproval power over the actions of the board.
David L. Shapiro: Oh. Yes, Your Honor. That's a related question which we think is relevant to Justice O'Connor's question. That is are the Members of Congress who serve on the Board of Review themselves exercising congressional power? Are they agents of Congress in trying to resolve this difficult separation of powers issue.
David H. Souter: And I took it that was one of the concerns in her question--
David L. Shapiro: Yes.
David H. Souter: --as to whether a similar structure could be erected--
David L. Shapiro: Yes, yes.
David H. Souter: --in relation to welfare money to the States, highway money to the States, and so on. What is your answer to that?
David L. Shapiro: Well, our answer to that is that in the unusual circumstances of this case we don't think the members of the Board of Review themselves are exercising congressional power or acting as agents of Congress. And that's because both in form and in substance we believe that the Members of Congress are serving as individual representatives of users. The statute specifically says they are to serve in their individual capacities as representatives of the users of the airport.
John Paul Stevens: Mr. Shapiro, are they representatives of all users or of users who have free parking spaces? [Laughter]
David L. Shapiro: Both.
John Paul Stevens: You think they are typical users?
David L. Shapiro: There is no question that the parking spaces were a matter of some interest. The legislative history confirms that. [Laughter]
John Paul Stevens: But not to other users.
David L. Shapiro: But they also have interests that are shared more broadly by all users, and indeed the legislative history suggests that they are concerned with their need to use the airport as individuals. And it's also true that that is a need that is... excuse me, Your Honor, my time is up.
William H. Rehnquist: Thank you, Mr. Shapiro. Mr. Coleman, we'll hear now from you.
William T. Coleman, Jr.: Good morning, Mr. Chief Justice, and may it please the Court: The basic issue here is are the congresspersons who under the statute act in their individual capacities as members of the State-created review board, quote, "officers of the United States", end quote, or as review board members do they exercise any Federal power pursuant to the laws of the United States. If the answer to these two questions is negative, as it clearly is, then the Authority's governing scheme created by the Commonwealth of Virginia and the District of Columbia does not violate present Federal separation of power doctrine. We agree with the Government that the review board members do not exercise any Federal power. The transfer act so states. The statutes of the Commonwealth of Virginia and the District of Columbia so state. The review board got all of its power and was created under bylaw 4, which is on page 152 of the record, and therefore they are not exercising State power.
Sandra Day O'Connor: Well, Mr. Coleman, isn't the reality, though, that the members of the board are required to be Members of Congress, or at least a certain number of them, and they have to be members of a certain committee of Congress? And it's arguable that when they cease to be they must be removed. Now, if that is the case, is there not an exercise of Federal power on a continuing basis?
William T. Coleman, Jr.: No, Your Honor, with all due respect. In the first place, your first question is directed to the appointment.
Sandra Day O'Connor: Um-hum.
William T. Coleman, Jr.: The speaker suggests the name. It's up to the board of directors, the State agency, to select. And Mistretta and Bowsher each teach that where there's the governmental, the Congress who suggests the name, but if the appointing authority has the discretion to select among that group, then you don't have violation of article... the article II, section 2, clause 2. So therefore, even if those people are suggested by the speaker, the fact that they are appointed by the board takes away that problem. With respect--
Antonin Scalia: Mr. Coleman, as I understand your position, the phrase that these people shall act in their personal capacity cleanses it all. I think you would maintain that even if it were provided that this board would consist of both Houses of Congress, the Members of both Houses of Congress acting in their personal capacity, it would still be okay, wouldn't it?
William T. Coleman, Jr.: --Well, Your Honor, that would make it a harder case. But--
Antonin Scalia: It would make it a different case. It wouldn't be harder for you, because they would still be acting in their personal capacity.
William T. Coleman, Jr.: --Well, it may be harder, some of them... one of the--
Antonin Scalia: No-- [Laughter]
William T. Coleman, Jr.: --So that's a harder case. But if the determination is that they are selected by State people and they are not exercising State power, then it doesn't violate the Constitution. In a constitutional debate it's dramatic the extent to which the people struggle to make sure that a Federal official still had the right to serve in State office. And that's what happened here. Now, with respect to the second part of your question, our position, it is clear, Justice O'Connor, that there is no power of removal by the Congress. And the fact that they used the word de facto reminds me of that Justice Jackson opinion where he says if we use a word like quasi, you know that you're really covering up a disorderly bad, because clearly you're saying you want to [inaudible]. Here the statute says only that the nominees shall consist of. Secondly, the lease which you have to read says it shall be made up and selected from the list of. Thirdly, they are appointed for a specific term. And as you know, Chief Justice, in your appointment with Smithsonian, you were appointed but you lose office the moment you're no longer Chief Justice. That's in the statute. That's not in this statute here. Fourthly, the appointing authority, namely the board of directors, specifically say that they can be removed for cause. So I think under all of your cases it is clear here that you have to find that once these people are appointed by the board of directors, they cannot be removed by the Congress, and they can only be removed by the board of directors or State agency.
Antonin Scalia: Mr. Coleman, in your research of, among the doings of the founders, that it is clear that people could hold both Federal and State office, but is there anyone who said that you could hold State office or be nominated to State office by virtue of your Federal office? That is ex officio that a State can provide the Speaker of the House shall be our Governor, or the Speaker of the House shall be our--
William T. Coleman, Jr.: Well, Your Honor, that's not this case here. The moment you said officio--
Antonin Scalia: --I know it isn't, but this is a case where it is not just Federal officials who happen to run for State office or get appointed separately for, independently of their being Federal officials. They acquire this State office only ex officio, only because they are Federal officials. Now, is there anything in the sayings of the founders about that?
William T. Coleman, Jr.: --No, but there is in your cases, Your Honor. I think Mistretta is right on the point. There the statute says a person had to be an article III judge, but yet you held the fact that they were an article III judge didn't mean that once nominated by the head of the judicial conference that the President couldn't select them, and by selecting them that they were not functioning as article III judges.
Antonin Scalia: Well, you're not blaming me for that, Mr. Coleman. [Laughter]
William T. Coleman, Jr.: Well, I think you would know more about that case than the other people because you dissented.
Anthony M. Kennedy: But of course there was no question in that case that they were exercising Federal power. We didn't have to reach that question. Here the question is whether or not the congressmen, because they are appointed as congressmen, are not exercising Federal power. Suppose on this board five, six of the board were Members of Congress. No difference to your case?
William T. Coleman, Jr.: Well, the nine persons are selected from the group of 107 Congressmen and 47 Senators. And, but they are appointed by a State agency, and therefore they are exercising State power.
Anthony M. Kennedy: Well, but as a practical matter a Congressman's powers during the time he is in office as a Congressman, his committee assignments, his perks, are all controlled by the Speaker. And it seems to me very, very clear that a Congressman who serves on the board can have his actions de facto reviewed by Federal authorities, particularly legislative officials.
William T. Coleman, Jr.: Well, but they, but the statute says no, he serves in his individual capacity. What you're saying is the people that pass the statute are going to violate the statute. And it seems to me if that happened, if that happened you may well then have a grounds for removing him for cause.
Anthony M. Kennedy: But, Mr. Coleman, all of our separation of powers jurisprudence looks to the practical effect of the constraints and the compulsions and the authority that a Federal agency has over its own officials, and in this case the Federal entity is the Congress.
William T. Coleman, Jr.: Well, can we look to the practical? Here you have a situation where, whatever is happening, there is no power being exercised on any other Federal branch of the Government. Too, here, you have the executive agreeing and standing up, not only negotiating this in the lease, but in addition signing the statute, but standing up at the bar of this Court saying that this does not in any way infringe on my executive power.
Anthony M. Kennedy: But this Courts sits to protect the executive against its own improvidence from time to time. [Laughter]
William T. Coleman, Jr.: Yes, sir. But there is no case, Your Honor, there is no case where you have ever held that there was an incursion on the executive power when the executive stands up at the bar of this Court and says my power is not being intruded upon. Secondly, there is no case where you have ever determined--
John Paul Stevens: Yes, but in the legislative veto cases the executive from time to time has taken the position that veto was all right, I think, had he not?
William T. Coleman, Jr.: --Yes. But in the case that--
John Paul Stevens: In the one that was argued here.
William T. Coleman, Jr.: --But the Chadha case he stood at the bar of this Court--
John Paul Stevens: Right.
William T. Coleman, Jr.: --and said it wasn't all right.
John Paul Stevens: Yeah.
William T. Coleman, Jr.: In addition--
John Paul Stevens: It just shows the executive's views on these issues can change in different administrations.
William T. Coleman, Jr.: --They can change. But as you know, that Justice Powell in the Nixon v. GSA said that once the executive stands up to the bar of the Court and says that my powers are not being infringed upon, that that in itself should cause the Court to give great weight to whether you're going to strike down the statute. I will reserve the rest of my time for rebuttal.
William H. Rehnquist: Very well, Mr. Coleman. Ms. Goldman, we'll hear now from you.
Patti A. Goldman: Mr. Chief Justice, and may it please the Court: There is no dispute that Members of Congress could not exercise the powers that are assigned to the Board of Review if the Federal Government still ran the airports. There is also no dispute that Congress could have required the Airports Authority to submit its actions to Congress for a specified period of time, or ever for approval in the form of a statute. The question here is whether Congress can make its delegation of authority over the airports subject to a condition that requires nine Members of Congress to exercise significant ongoing authority over those airports. Four factors of the Board of Review arrangement bear directly on this issue. First, the Board of Review arose out of a Federal condition that is contained in a Federal statute and a lease of Federal property. Second, that condition requires nine Members of Congress to comprise the Board of Review. They must all be recommended by the congressional leadership, and eight of them must serve on the congressional committees that have oversight responsibilities over the airport. The third factor is the powers exercised by the Board of Review. There is no question that the types of powers that the board exercises are executive in nature. And the fourth factor is the nonseverability clause, or what we have called the drop-dead clause. Congress has decided in the statute that if the Board of Review cannot exercise its powers, neither can the Airports Authority. And the significance of this factor is that Congress made that decision, not the District and not Virginia, and also that Congress believed that the power its Members would exercise was an essential element of the transfer.
William H. Rehnquist: Ms. Goldman, what if instead of the transaction we have here Congress had simply said we're going to give a year-to-year lease to the Metropolitan Airports Authority, no Members of Congress on the review board at all, but the review board totally independent decides to abolish parking places for Members of Congress and Justices of the Supreme Court. And the chairman of the House Commerce Committee calls the members of the review board over about a month before the first year of the lease is due to expire and he says I really don't think Congress is going to renew this lease if you do that, and they accordingly change their mind. Now, there would be nothing wrong under separation of powers with that, would there?
Patti A. Goldman: There would be not... no official ongoing role that Members of Congress play. Of course Congress still has the power, the retained congressional power to pass statutes and to decide whether the lease could go forward, but that's the kind of power Congress can exercise. Its mingling in the affairs may be improper, but it probably would not rise to the level of the separation of powers violation.
Antonin Scalia: Of course if Congress wanted to renew the lease, if Congress was content with the parking spaces it got but the executive was not content because the executive had not gotten parking spaces, the President could veto the lease renewal in that situation, couldn't he? I mean, it would be the normal process of legislation by which Congress would have to act, rather than--
Patti A. Goldman: Assuming that statute was required, then the President would have that power.
Antonin Scalia: --It's quite a different process than just having some individual Members of Congress or a committee of Congress decide to do it or not.
Patti A. Goldman: It's a very different process, and that's precisely what's wrong with this arrangement. Members of Congress are carrying out day-to-day operational responsibilities over these airports. It's important to recognize too that Congress did not give up the airports, and that it independently obtained this power. It refused to give up the powers that are exercised by the Board of Review. In essence this is an incomplete delegation of power. Congress gave up a large measure of the power, but not the power over the master plan and the budget and regulations. These powers it kept for the Federal Government, and it assigned these powers to nine of its own Members. As retained Federal powers, these powers cannot be exercised by Congress in this way.
Antonin Scalia: You say assigned it to nine of their Members, but it does provide that the Members are to act in their individual capacity.
Patti A. Goldman: It does, but that label does not change the fact that the board must consist of nine Members, that they must be recommended by the congressional leadership.
Antonin Scalia: What do you do about the Chief Justice being on the board of the Smithsonian, being chairman of the board of the Smithsonian, which goes back quite a ways?
Patti A. Goldman: We certainly don't want to be accused of laying a hand on the arc of the covenant, as Justice Holmes said, and fortunately I don't think we have to in this case. I think the powers that are exercised by the Smithsonian may be different in nature. They may not rise to the level of significant authority--
Antonin Scalia: They're artistic powers, is that-- [Laughter]
Patti A. Goldman: --I'm not familiar with the day-to-day functions that the board would exercise, but it may be that those powers are not as significant to be a Federal office under the laws of the United States, so Members of Congress may be able to exercise those functions. Here, though, the functions are clearly executive. Members of Congress could not exercise these functions in the Federal scheme, and Members of Congress could not in their individual capacity exercise a veto of the sort that was struck down by this Court in Chadha. That individual label would not save that arrangement. If Congress is going to exercise this type of power it must do so through the bicameralism and presentment clauses.
William H. Rehnquist: Let me ask you a question, Ms. Goldman. There are six congressional regions of the Smithsonian, and I presume they act in their individual capacity, don't they? They're not acting as a Member of Congress or as a member of a congressional committee.
Patti A. Goldman: I believe that their appointment and service is inextricably tied to their role as a Member of Congress.
William H. Rehnquist: Well, what distinction are we talking about here then, between acting in one's individual capacity and one's presumably official capacity? Is that the alternative?
Patti A. Goldman: Well, in the Federal scheme Members of Congress only have one identity, and that is their official role. Because of the incompatibility clause, Members cannot take off their congressional hat and become individuals serving in some Federal kind of position. In the situation of the Smithsonian their service is tied with the term of office, as we believe it is here as well.
David H. Souter: So you would have no issue to raise by the mere fact that some Members of Congress happen to end up on this board if it were not for the fact that membership on the board... that membership in Congress is a qualification for membership on the board? I mean, that's really the essence of your point. You're saying if that were not so, then it, it would in fact make sense in the normal course to say that they were acting in their individual capacities.
Patti A. Goldman: If Members of Congress are appointed to a State office, they are not serving as Members of Congress but are clearly serving in an individual capacity.
David H. Souter: And their congressional membership is merely incidental. And you're saying the fact of the qualification is what removes it from the category of what is merely incidental.
Patti A. Goldman: It is both the qualification, the requirement that they be Members of Congress, and also that that requirement came at least in part from Congress. So that in this situation we have congressional aggrandizement, where Congress, by passing a statute that establishes this condition, has required that its own members get power over Federal property.
Sandra Day O'Connor: And why isn't the same... why doesn't the same problem exist for the congressional members of the Smithsonian?
Patti A. Goldman: It may not because the powers they exercise may not be as significant of a type of executive power--
Sandra Day O'Connor: Well, what if the power is the power of a board?
Patti A. Goldman: --It may be then a power that they cannot exercise. I am not as familiar with that arrangement. That's obviously not before the Court. And in Springer that was discussed in the context of the powers exercised by the legislature in the Philippine Islands, and it did not keep the majority from striking down that arrangement.
Sandra Day O'Connor: Do you take the position that a member of the Board of Review loses the membership if the member ceases to be a member of the appropriate congressional committee?
Patti A. Goldman: Yes, we do. The language of the statute is that the Board of Review shall consist of the nine Members of Congress, eight of whom must serve on the oversight committees. It does not say that the board shall consider these people for appointment or shall appoint them. It says the board shall consist of these individuals.
Sandra Day O'Connor: Is the removal point essential to your argument?
Patti A. Goldman: It is not. In this case the clear indication is that the Board of Review has the power over the Airports Authority. That is the critical feature.
Harry A. Blackmun: Ms. Goldman, are you familiar with the national historical publications in the Records Commission?
Patti A. Goldman: No, I am not.
Harry A. Blackmun: Well, this is set up by statute, and it provides that on this, which I assume is an arm of the executive, there shall be one judicial member appointed by the Chief Justice, one Member of the House of Representatives, and one Member of the Senate. Invalid in your analysis?
Patti A. Goldman: If its functions are advisory, it would certainly not be invalid. If it has some operational functions it may not carry out significant powers to be an agency or to rise to the level of an office of the United States. So the answer to that question would depend on the precise powers that are carried out.
Harry A. Blackmun: Which you don't know.
Patti A. Goldman: Which I don't know.
Harry A. Blackmun: Well, the Chief Justice has served on it and so have I and--
Patti A. Goldman: Certainly the service of judges would not be prohibited under a decision in this case striking down the Board of Review, since there is no incompatibility clause for judges and there would be no aggrandizement if Congress required by statute that judges serve in this type of arrangement. But the service of Members of Congress is a different story because of the aggrandizement factor and the incompatibility clause. If this arrangement is upheld, the Board of Review would provide a road map for Congress to follow whenever it wanted to acquire a day-to-day power over the operation of Federal property or Federal funds.
Byron R. White: --But they'd have to do it by statute, and they would have to get the President to sign it or override his veto, wouldn't they?
Patti A. Goldman: True. They would have to exercise that power through a consent to a compact or statute.
Byron R. White: And you would say if the President willingly signed it and thought it was a good arrangement, it would still be invalid in your view?
Patti A. Goldman: Yes, it would be, because the doctrine of separation of powers is not designed simply to protect the executive branch, in fact its primary purpose is to protect the people against arbitrary exercises of power.
Byron R. White: And tell me how that is implicated in this case.
Patti A. Goldman: In this case the respondents are individuals and organizations that represent individuals who are affected on a daily basis by the operations at National Airport. They are interested in the noise, the traffic congestion and pollution--
Byron R. White: Well, protecting the executive here isn't about to cure your problem.
Patti A. Goldman: --It's not about protecting the executive. It's about protecting--
Byron R. White: All it will do is delay.
Patti A. Goldman: --It might do more than that by requiring that the Airports Authority take its actions through a democratic process as required by the Constitution. And those processes are designed to protect the people from laws that create too much power to one branch of Government.
Byron R. White: Well, if Congress had retained power over the airport, it could expand the airport with the... and the executive could go along?
Patti A. Goldman: It could do that. It may have certain interests in mind that may be adverse to other users or to the people in the area.
Antonin Scalia: As you quoted in your brief, the problem with that is that Congress would have to pay for it, as you had an excerpt from some of the debate in which a Congressman said the beauty of it is that we control it but we don't have to pay for it.
Patti A. Goldman: Exactly. And that same person said that Congress would be eating... getting its cake and eating it too. And that's the problem with this arrangement is Congress can't do both. It can't give up the power and retain the core power at the same time. It has to do one or the other. The delegation of the power did have the benefits of ensuring some degree of local control and the ability to raise money through bonds, and to remove the airports from a line item in the Federal budget. It can, the Congress cannot get rid of that responsibility but keep the decision making power over regulations and master plans, the chief executive order and the other powers that are given to the Board of Review. If this arrangement is upheld, Congress will be able to inject itself into decisions about how the national parks are operated, perhaps grants given by the National Endowment of the Arts, postal operations, legal services programs. And the way it would do this is by delegating those programs in part to the States or private entity, but requiring the States or the private entity to subject their decisions to review by an ad hoc committee of Congress, or even one House of Congress, and then Congress would be able to influence and have a mandatory say over how these programs are run.
Anthony M. Kennedy: So is the federalism problem as you see it that Congress has had a hand in creating the very position to which they are directing the congressional appointment?
Patti A. Goldman: Yes. That is what creates the congressional aggrandizement here, which is the primary flaw in this arrangement. Congress retains--
Anthony M. Kennedy: So do you say that this board is really created by Federal law?
Patti A. Goldman: --It is mandated by a condition. If the State of, Commonwealth of Virginia and the District of Columbia wanted these airports, they had no choice but to have a board of review. It was their statutes that created the Airports Authority, but it was the Federal statute that set out the powers and composition requirements for the Board of Review. So Congress had some say and had some power that it exercised here, and it used that power to give its own Members a veto.
Anthony M. Kennedy: Do you think if there were a 1983 suit against members of the board that it would be an appropriate defense that they are Federal officers?
Patti A. Goldman: In this situation, because Congress retains significant Federal powers, I think they are Federal officers. However, there could be other Federal conditions that would not create Federal offices. And even if this is not viewed to be a Federal office it would be impermissible, because it is giving Members of Congress powers over Federal property that it cannot have.
Anthony M. Kennedy: Well, I suppose you can concede without sacrificing your position that they're both, both State and Federal.
Patti A. Goldman: I know no precedent for that, but I assume they have aspects of both. Even if the power that is actually exercised is viewed to be State power, Members of Congress could not serve in those positions under the doctrine of separation of powers. There is enough of a Federal role through the Federal condition to call the doctrine of separation of powers into play, and that doctrine prohibits Members of Congress from exercising these types of powers over a significant Federal interest. And here--
William H. Rehnquist: Ms. Goldman, do you think this statute offends more against separation of powers within the Federal Government or more against federalism, Federal-State relationships?
Patti A. Goldman: --This case concerns the Federal separation of powers.
William H. Rehnquist: We're not talking about federalism then in the sense of South Dakota against Dole?
Patti A. Goldman: I don't think we are, because in the kind of condition that was at issue in that case there was a question of who had the power. Congress didn't have the power to legislate and the States did. And I think the rationale is that when the States exercise their power, their political process cleanses the Federal role. But when you're talking about individual rights under the Federal Constitution, or the doctrine of separation of powers, which in the end protects the people, the State isn't interested in protecting those interests. And that... the State process doesn't remove the Federal role, the Federal mandate that the separation of powers be violated. Because of that, a condition is not the right way to accomplish this result. It doesn't erase the problems that are presented by Members of Congress serving in this role.
Anthony M. Kennedy: So you see there would be no problem if Congress said that every State university which obtained Federal funds should have a board of regents, five, six of whom are appointed by the President of the United States?
Patti A. Goldman: I think there would be a problem in that situation. That's a federalism problem--
Anthony M. Kennedy: What would be the problem?
Patti A. Goldman: --that the Federal Government is usurping State power in that instance.
Anthony M. Kennedy: Well, why isn't that same problem present here?
Patti A. Goldman: Here there is a stronger Federal interest at the outset because of the presence of Federal property in this arrangement. So the power was the Federal Government's power to delegate. And when it delegated these powers it attached conditions which kept--
Anthony M. Kennedy: Well, I assume the President would say the, and the Congress the same thing with expenditure of Federal funds at State universities.
Patti A. Goldman: --If Congress set up a review board that had power over the Federal monies, the connection to the Federal interest may be strong enough for the Federal doctrine of separation of powers to be called into play. But where the power is the power to run a State university, which is State power at the outset and does not change by the Federal condition, the Federal appointment of individuals would probably usurp State power.
David H. Souter: But isn't the justification in each case the fact that there is Federal property in the form of Federal money going, and that these are conditions placed upon the Federal money. Don't they ultimately all stand on the same footing?
Patti A. Goldman: I don't think they necessarily do, because Congress can pass a statute setting out the conditions that are attached to the use of Federal money. If its role ends there--
David H. Souter: Isn't the difference that the... we're not talking about a condition set once and for all by Congress which is binding because it is... it has statutory significance. It's setting up a condition which imposes a continuing review by Federal officials.
Patti A. Goldman: --That is the... precisely the difference. If Congress--
David H. Souter: Don't we have that in both the State university example and the highway funds example?
Patti A. Goldman: --If Congress sets up an ongoing role over the Federal funds or the Federal property, then it is going too far, and that is Federal power that cannot go to Members of Congress.
David H. Souter: Okay. And all you're saying is you don't really have to think of that as a federalism problem. It's a straight separation problem. Is that what you're saying?
Patti A. Goldman: As soon as there is an on-going role by the Federal Government it is a Federal separation of powers issue.
David H. Souter: Okay. And you don't have to put a federalism overlay on it. That's really what you're saying?
Patti A. Goldman: No. There's no federalism issue--
David H. Souter: Okay.
Patti A. Goldman: --that comes up in that context. There could be other federalism issues, but the one we're focusing on here is the purely separation of powers one when there is an ongoing Federal role.
David H. Souter: Okay.
Patti A. Goldman: If there are no further questions--
William H. Rehnquist: Thank you, Ms. Goldman. Mr. Coleman, do you have rebuttal? You have 4 minutes remaining.
William T. Coleman, Jr.: Thank you, Mr. Chief Justice. It is clear here that the power of appointment is in the State board. It's equally clear that the Congress has no power whatsoever to remove these people. We make it clear in our brief that using the words "consist of" in other Federal statute doesn't mean that once the person is appointed he or she loses his job if he no longer holds the office. You also have the fact that the Federal statutes, when they want to mean that, say that. This one doesn't. Also, here the, the State makes it clear that it has the power of removal. And we say under your cases where if you're struggling with the power of interpretation, if you can interpret the statute in a constitutional way, you should do that rather than to interpret it in a way which I really don't think is supported by the legislative history. In addition, there was a lease created here, and that lease lay in Congress, and that lease talks in terms of appoint, not consist of. And Congress did nothing to change that. So that's an additional reason why you should try to interpret the statute the way I suggest. Finally, our forefathers wanted to create a Federal Government, but they didn't want the Federal Government to be at war with the State government, and therefore it went out of its way to say that people that occupy Federal office could also, if the State wanted, occupy State office. Here you have that type of federalism, and there is no reason to stretch the Federal separation of powers doctrine in this case, where the chief executive of the Federal Government says I'm not being intruded upon, there is no aggrandizement. What aggrandizement can there be when all Congress did was pass a statute which authorized the Federal officials to do what the Constitution said they could do, namely serve in State office. Now, certain States have rejected this. I think New Hampshire, for example, you have a position, provision, Justice Souter, which specifically says that the Federal official cannot occupy the State office. Virginia could have done that. It didn't do that. In its case it has a statute which says that the Federal officer can occupy the State officer. And I repeat, unless you find that the congressional person is an officer of the United States, which I think under the statute you can't find, or unless you find that what they're doing is exercising Federal power, then I think here you have to reverse the decision of the court below. Thank you.
William H. Rehnquist: Thank you, Mr. Coleman. The case is submitted.