Federalism under the Influence: Dope, Booze, and the Commerce Clause

November 10, 2004

Edited transcript prepared from a tape recording

Proceedings:
MR. GREVE: My name is Mike Greve.  I'm with AEI's Federalism Project, and I welcome all of you today.  We're here to discuss two cases or sets of cases that will be heard by the Supreme Court very shortly.  One concerns California's Medical Marijuana Law.  The other set of cases concerns various state restrictions on direct, interstate shipments of wine. 

We'll first do one panel on the wine cases.  We'll do one panel on the marijuana case.  We will then hear from Richard Epstein on whether the modern Supreme Court is up to a sensible interpretation of the Commerce Clause.  Thereafter, we'll adjourn for some product sampling.  There's, of course, wine out there, and you may want to be careful with the cookies we've prepared for this occasion.

Before we start, I'd thought I'd say a few words on our decision to discuss these cases in tandem and to yoke them together in this fashion.  To take the obvious first: both cases are to be argued within 10 days from each other; the marijuana case on November 29th; the wine case on December 7th.  Both obviously involve intoxicating substances.  Both involve the Commerce Clause; in one case, the affirmative Commerce Clause, which is actually in the Constitution, and in the other case, the dormant Commerce Clause, which arguably is not.

In both respects, these cases come after a considerable hiatus.  The last Commerce Clause case was decided in 2000, which is now quite some time ago.  That was U.S. v. Morrison.1  The last dormant Commerce Clause case goes back even further, to 1997.  That was Camps Newfound.2  It will be interesting to see what, if anything, has changed on the Court in this regard since then.  But there's a little more to this.  These cases involve lots of nuances, dicey legal questions, and constitutional provisions—in particular, the 21st Amendment—in addition to the Commerce Clause.  These questions deserve the attention our expert panelists will undoubtedly devote to these matters.  But I want to take one step back and point out the way in which these cases highlight two very distinct problems of American Federalism, which, when you think about it, turn out to be two sides of the same problem.

The first problem is federal meddling in local affairs. That, of course, was the target, for example, of the Reagan Administration's New Federalism, and the concern has become only more pressing over time.  Forget about for one second what Congress may do, what the true extent of its commerce powers is.  Forget about the merits of California's Medical Marijuana Law and your thoughts on medical marijuana or marijuana in general.  It seems to me this case is about is grossly misplaced priorities.  Last one looked, this country is fighting an actual war.  As we all know, that poses, among other things, pressing legal questions. There are in the international arena pressing legal questions.  Here at home, Attorney General Spitzer is laying waste to one industry after another.  And amidst all of that, the federal government is trolling after casual or medical drug users.  Quite apart from the powers question, that seems strangely misplaced.

Look at the Federalist Papers and ask yourself, what did Hamilton actually think?  What would be the ultimate safeguard against the wholesale displacement of state authority?  The answer is something like economies of scale.  There would be no advantage to the Federal Government meddling in local matters, Hamilton said.  Obviously, that is no longer true.

The second federalism problem is state interference with interstate commerce.  Any number of examples come readily to mind.  Class actions with tens of thousands of members, we're now told, are the intrinsic prerogative of some Mississippi or Illinois Court, because that's where the plaintiff chose to file them.  State AGs have assumed an astounding measure of authority over interstate commerce.  States regulate and tax interstate transactions on an unprecedented scale.  The trial lawyers and the attorneys general will all tell you, hey, that's what federalism is about, but it seems to me obvious that this is not what federalism is about.  It is a federalism problem, and it's arguably by now more serious than federal meddling in local affairs.  Again, read the Federalists Papers.  The Founders are almost obsessed over protecting commercial relations from state meddling, and they erected a whole edifice to guard to against it.  Maybe the dormant Commerce Clause is indeed an invention, but the prohibitions of Article I, Section 10, the non-discrimination provisions of Article IV, federal diversity jurisdiction—these are actually there.  They're not constitutional inventions, but all of them have gone out of commission over a very wide range. Of course, Congress can also preempt state interferences; that, in fact, is the original purpose of the Commerce Clause.  But it's equally obvious that frequently Congress doesn't do this.

I’ve said that these two problems are actually two sides of the same federalism problem, and to my mind, it's this: any federal regime presupposes some distinction between national affairs and local affairs and some way to protect that equilibrium within some range.  But we don't have that anymore.  What we have instead is basically full concurrent state and local and federal authority over the full range of private transactions. 

That's the 30,000 foot overflight view.  Before you're free to move about the cabin, I want to leave you with two questions.

The first question is this: a federal system that routinely generates this bilateral overreach needs constitutional limitations.  But it may also be the system that is least able to enforce them, and the reason why it may be least able to enforce them is that the political institutions are so committed to the regime.  Maybe you can draw some lines in this or that case—maybe in these cases we're here to discuss today.  But if the Supreme Court can take only what the political branches will give it, and if that ain't much, then you have to ask yourself at some point, why try in the first place?  What is the entire enterprise really worth?

My second question is this: what has prompted this loss of a federal equilibrium in the first place?  The conventional account, I take it, is that industrial capitalism happened to the Constitution, and the troglodyte system that the Founders invented was just not tenable.  Complex industrial organizations confound distinctions between national and local affairs, or so one hears.  Personally, I think that was never very believable.  If you look at the cases of the era when the system collapsed—Wickard v. Filburn,3 Erie Railroad4—complexity is not what went on in those kinds of cases.  But at least there, the argument still had a veneer of plausibility.  You were dealing with railroads, with agriculture, with big industrial systems.  You look at the cases we're here to discuss today, and I think it's totally implausible.  It's true that in the wine cases the states argue that their interests require a seamless web of regulation.  But it's equally obvious, at least to me, that they can have that seamless web of regulation without discriminating against out-of-state commerce.  (Again, put aside the 21st Amendment question for the purposes of this discussion.)  In the marijuana case, the federal government says that the Controlled Substances Act, which controls not only marijuana but all prescription drugs and so forth, would completely collapse without criminalizing the mere possession of marijuana.  But I think no one really believes that as an empirical proposition.  So, what's happening here is that complexity and interdependence arguments are marched into a battlefield where there' a very serious risk that they'll be shot down by one single stray bullet, let alone a sustained argument.  That raises the suspicion that they are a mere decoy for something else, for some other argument or force that drives this. 

I actually have a hunch what that something might be, but I'll leave you all to guess.  Instead I'll introduce the moderators of our panels, who will, in turn, introduce the speakers; and I'm delighted to say that both of them are very old friends of AEI, and the Federalism Project, and myself.  Hew Pate, Assistant Attorney General for Antitrust, will moderate the first panel; Ed Warren, of Kirkland & Ellis, the second.  Thanks, all, again.

UNCORKING THE DORMANT COMMERCE CLAUSE

MR. PATE: Well, thanks very much, Mike. It's great to be here at AEI to talk about these cases.  I have to first give something I rarely give, which is a disclaimer.  Usually, unlike the situation at the Federal Trade Commission, where you have a multi-headed body, I'm able to say that anything I say may well bear a striking resemblance to the official policy of the Antitrust Division.  But not today, because the Justice Department has taken no position in these cases, and anything I say is purely on my own nickel.

We're here to talk about two cases in which the Court is going to be addressing the application of the Commerce Clause to wine importation:  Granholm v. Heald from the Sixth Circuit, and Swedenburg v. Kelly from the Second Circuit.

In brief summary, in Michigan, in-state wineries, under the Michigan statutory system, are allowed to direct ship to consumers, but out-of-state consumers are required to use the traditional three-tier wholesale and resale regulated alcohol distribution network.  In New York, it's a little bit different. Both in and out of state wineries are able to ship to consumers, but must do so while maintaining a physical presence in New York.

You don't have to go very far in these cases to see that they're a great opportunity for attempts to make a witty turn of phrase.  When I first got into it, I was directed to the Wine and Spirits Wholesalers of America web site to get the briefs, and I find that the Wine and Spirits Wholesalers motto is “bringing you life's memorable moments.” [Laughter.]  Which I think has a certain irony. 

The disputes over whether discriminatory wine importation laws are going to be valid have produced opinions not just from the Sixth Circuit and the Second Circuit, but also from the Eleventh, the Fourth, and the Seventh Circuit.  In the Seventh Circuit, this dispute happened to reach the desk of Judge Easterbrook, who observed in opening his opinion that “[t]his case pits the 21st Amendment, which appears in the Constitution, against the ‘dormant Commerce Clause,’ which does not.”5  And so, we have the question whether the discriminatory aspects of the state statutes at issue will violate the Commerce Clause.  I won't necessarily say dormant, because that's part of the argument—whether in light of the re-passage of the Webb Kenyon Act, it's fair to say the Commerce Clause is dormant here or not.  And then the second question, if you chose to follow the traditional form of analysis, is whether laws that would otherwise be illegally discriminatory under the Commerce Clause are saved by virtue of being within the core purposes of the 21st Amendment.  The Second Circuit went about its analysis in a slightly different order, and our panelists, undoubtedly, will talk about that.

We're very fortunate to have with us today a couple of clear experts on the field.  Brannon Denning is Associate Professor of Law at Sanford University's Cumberland School of Law, where he teaches Constitutional Law and Professional Responsibility.  Prior to joining Cumberland, he taught at Southern Illinois University's School of Law.  Brannon has written extensively on the Commerce Clause, the dormant Commerce Clause doctrine, and various other constitutional and political issues.  For purposes of today's talk, he has written an article entitled “Smokey and the Bandit in Cyberspace: The Dormant Commerce Clause, the 21st Amendment, and State Regulation of Internet Alcohol Sales.”  In this article, Brannon makes the observation that recently lower court cases invalidating long-standing state alcohol regulations seem to have fallen under the spell of the Internet, and assume that e-commerce must be free. 

Our next speaker has responded to that with an extensive blog from the Volokh Conspiracy, which you can find on the Internet.6  Todd Zywicki is currently a Visiting Professor at Georgetown University Law Center.  He's on leave from George Mason.  During the 2003 to 2004 academic year, he served as director of the Office of Policy Planning at the Federal Trade Commission.  Todd teaches in the areas of bankruptcy, contracts, commercial law, law and economics, and public choice in the law.  He's also taught previously at Boston College Law School, and at Mississippi College School of Law.

So, without further ado, I'm going to turn to our speakers to discuss these cases, which have produced an outpouring of briefs from some of the leading lights in Supreme Court practice, and undoubtedly will lead to interesting arguments.  By coin toss, Todd, you have the floor.
MR. ZYWICKI: Thanks, Hew.  My mission is to talk about the direct shipment of wine cases, but also to draw some more general lessons about what we can learn about federalism and about the change in the Commerce Clause over time, as Mike discussed in his opening statement.  I'm going to talk first about the wine direct shipping cases, and, in some detail, about the historical context in which the 21st Amendment was enacted.  That will help us to tease out how the Commerce Clause has changed over time and what that tells us about it.

Now, just to kind of clear the decks with some background points.  I'm sure nobody in this room has ever done this, but rumor has it that occasionally, maybe back in your old days, you may have known some kids in school who were underage drinkers, who somehow managed to sneak over to the 7-11 and slip past the vigilant minimum-wager behind the counter and actually get a bottle of Gallo or maybe a six-pack of Milwaukee's Best.  A lot of things have been kicked around on the policy front about how kids are going to get on the Internet and buy pinot noir.  It's obviously a silly argument.  Kids can buy alcohol from traditional bricks-and-mortar outlets very easily.  The estimates are that 15 to 30 percent of the time at least, kids are able to buy alcohol from traditional bricks-and-mortar outlets. 

Moreover, this isn't a question about whether or not there's going to be direct shipping or not.  In New York, for instance, there are already 190 in-state wineries shipping directly to consumers.  The only question is whether or not Virginia and Oregon wineries can also ship, along with New York wineries. The physical presence exception that Hew described is, of course, a myth, which is to say that no winery has ever qualified for that because it requires them to have a warehouse and all sorts of silly things.  So, it's not a serious exception, although the Second Circuit seemed to believe in some sort of existence proof regarding it.  It's also the case that the evidence indicates that consumers are unambiguously better off in terms of lower prices and greater choice from Internet sales.  See the path breaking report by the Federal Trade Commission on Internet Wine Sales.

Clearly if this were not alcohol, the state regulation would violate the dormant Commerce Clause.  Clearly, there's no serious justification for these laws.  There's certainly no evidence that actually backs it up, which is usually what's required in a Commerce Clause situation, especially for discriminatory laws.  The question here is, given that state law is blatantly discriminatory and largely pointless, is it nonetheless saved by the 21st Amendment?

The 21st Amendment has three provisions.  The first repeals the 18th Amendment, which imposed Prohibition.  The second says that “The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors in violations of the laws thereof, is hereby prohibited.”  Now, some people have argued that by its plain language, Section 2 allows the states to do whatever they want to in the field of alcohol.  And in Young’s Market,7 the protectionists' favorite case (which was decided back in the '30s), the Court did not look at the legislative history and simply said that the 21st Amendment saved the state law at issue.

Well, if you're serious about the plain language, you've got to really be serious about it.  So, if the states can pass any law, then they could say only white people can import wine.  Or they could say you can only import wine if you agree not to criticize the government.  Heck, it seems to me they could enslave people and force them to drive beer trucks, because that's only protected by the 13th Amendment.  There's nothing in Section 2 that specifically limits it to the Commerce Clause or the dormant Commerce Clause.  In fact, in Young’s Market, Justice Brandeis acknowledged as much because there the argument was both a dormant Commerce Clause argument and an equal protection argument.  Justice Brandeis, being honest, said the claim that the statutory provisions and the regulations are void under the Equal Protection Clause may be briefly disposed of.  That is, a classification permitted by the 21st Amendment cannot be deemed forbidden by the 14th.

So, if you decide to go down the plain language route, if you're in for a dime, you're in for a dollar.  You've got to agree that the Amendment repeals everything that came before it.  There's no principled distinction in the text to draw a distinction.  Unsurprisingly, the Supreme Court has decided that's not a very appetizing way of going about this, and, in fact, has applied the Equal Protection Clause, the First Amendment, Due Process, the Commerce Clause itself, and the Export-Import Clause.  All these things are said to be effective, notwithstanding the 21st Amendment.  Plain language doesn't get you very far.

That turns us to the question of the history of the 21st Amendment.  And what you see when you actually look at the history is that the purpose of the 21st Amendment was to reverse the disastrous experience with Prohibition that was ushered in by the 18th Amendment.  What it intended to do was to restore the constitutional balance that had been disrupted by the 18th Amendment.  The problem with the 18th Amendment was that it got the federal government too much involved in the local and state affairs governing alcohol.  The effect of the 21st Amendment was to take the federal government back out of local police power affairs, and to give back to the states exclusive authority to use the police power.

Nothing in the history and nothing in commonsense, logic, or anything, suggests that Congress meant to give the states new powers to meddle in interstate commerce.  The problem was the federal government had overreached, and that's what Congress was trying to pull back on.

The background is in the 19th century, in the license cases.  In Mugler v. Kansas,8 the Supreme Court said that states, pursuant to their police power, could enact prohibition within their states, barring the sale and manufacture of alcohol within their boundaries.  The police power gives the states the power to regulate local affairs in the name of health, safety, and morals; right?  The problem was that notwithstanding the fact that states could enact prohibition (pursuant to their police power), they could not bar importation of alcohol from out of the state.  Under the so-called original package doctrine, which prevailed in the late 19th century, states were required to allow the shipment into the state of alcohol so long as it was in its original package.  The Supreme Court held that commerce did not end, and the police power did not attach, until the product actually came to rest, basically when the person popped the top off of the booze.

In the Wilson Act, Congress, using its Commerce Clause authority in a positive manner, said that notwithstanding the original package doctrine, the police power of a state would attach to alcohol once it hit the state.  It would attach in the same way to imported alcohol as it did for domestic alcohol.  The effect of this was to try to eliminate the reverse discrimination which had been caused by the alternative regime.  In Scott v. Donald,9 the Supreme Court said that because the Wilson Act was enacted pursuant to the states' police power, it was also subject to the traditional restraint on the state police power, which does not allow discriminatory bans on interstate commerce.  Here, the Supreme Court was building on a prior case called Walling v. Michigan,10 which unambiguously held that the police power does not allow states to enact discriminatory barriers to interstate commerce. 

The problem with the Wilson Act was it did not reach alcohol used for personal use.  So, in the Webb-Kenyon Act, Congress, again using its Commerce Clause power, went a further step and basically prohibited the shipment of transportation of alcohol into a state in violation of the law of any such state.  Webb-Kenyon was designed to close the personal use loophole, to allow states to be completely dry and not have to deal with alcohol being shipped into their state.  In Brennen v. Southern Express Co.,11 which is the only case I've been able to find on this because it's a very short window, the South Carolina Supreme Court said that the effect of the Webb-Kenyon Act was to simply extend the Wilson Act in this way, and the Court there specifically said the non-discrimination principle that ran from Walling through the Wilson Act and Scott v. Donald to the Webb-Kenyon Act remained fully in force.  Again, it was allowing the states to attach their police power to things shipped in interstate commerce.

The system worked fine until the 18th Amendment, the effect of which was to try to make wet states dry.  That turned out to be a complete catastrophe.  And why was Prohibition such a catastrophe?  It got the federal government involved in police power activity on the local level—busting saloons, and doing all those sorts of things.

Treasury Secretary Andrew Mellon noted in 1926 the catastrophe that Prohibition had become, and to him the problem was jurisdictional.  What everybody understood, at least until Justice O'Connor got a hold of the 21st Amendment in a case called 324 Liquor about 20 years ago,12 was that the 18th Amendment was repealed by the 21st Amendment because the federal government was terrible at imposing Prohibition.  What everybody understood was that the purpose of the 21st Amendment was to withdraw the federal government from meddling in local affairs governing alcohol. 

That's the language that you see over and over again in the legislative history: “restore the constitutional balance.”  Senator Wagner said the purpose of the 21st Amendment was to restore the Constitutional balance of power and authority in our federal system, which had been upset by national Prohibition.  That equilibrium, he called it, which prior to the 18th Amendment was one of the functional marvels of our system.  And what was that system?  It was a clear division that gave the states exclusive authority for the local police power, and gave the federal government authority over interstate commerce.  And, in the Wilson Act, in the Webb-Kenyon Act, what we saw was the federal government using its Commerce Clause authority to allow the states to attach their police power to imported alcohol.

It's often a rhetorical device to say that someone could not be more wrong in characterizing particular legal arguments.  In this case, it's literally true: if you read Justice O'Connor, who's been the leading Supreme Court apologist for protectionism in this realm, it is clear that she has the issue 180 degrees backwards.  Every single snippet of legislative history (and it's always just snippets--it's never put in context) she relies on is backwards, because she has completely lost track of the fact that the 21st Amendment was repealing the 18th Amendment, withdrawing the federal government from local police power activity. There's nothing in any of the history I've described that suggests that Congress meant to give the states new powers; completely unexplained, unnecessary, novel powers to regulate interstate commerce.  The evidence suggests that Congress meant to allow dry states to stay dry after the repeal of Prohibition, but there's no evidence that it meant to allow wet states to engage in economic warfare against the products of other wet states.  There's simply no evidence that that is the case.

So, what does this tell us about federalism?  First, under the old regime, what we saw was a very clear division of responsibility between the state and local governments to regulate in the name of the police power and the federal government to do interstate commerce.  Nowadays, it's very muddled; the states are doing their own thing; while the federal government, through the spending power and under the Commerce Clause,  has essentially arrogated to itself what looks like a police power, notwithstanding some protestations in Lopez.  It seems to me that a case could be made that the old system of very clear delineation was much preferable.

Second, the new regime has created an ambiguity about the Commerce Clause itself, which is to say that we've got this sort of bastardized offspring of the dormant Commerce Clause in the past 50 years, which is the Pike balancing test.  Often people say that Justices Scalia and Thomas don't believe in the dormant Commerce Clause.  There is no dormant Commerce Clause.  But that is completely untrue.  Scalia and Thomas recognize that the non-discrimination prong of the dormant Commerce Clause is inherently part of the Constitution.  It's a key structural protection of the Constitution.  An excellent article by Brannon Denning, available on SSRN, goes through the early history.13

Scalia and Thomas make it very clear that the non-discrimination principle is robust.  What they disagree with is the Pike balancing test.  And why did we get that test?  Because we started muddying the lines about 50 years ago, so we couldn't figure out what was legitimate federal action and what was legitimate state action.  If you read Judge Easterbrook's opinion closely [in Bridenbaugh], it is clear that he is drawing that distinction as well.

One last word on the litigation: either way the Supreme Court might uphold these laws is a complete catastrophe.  Either the Supreme Court could say the state laws are discriminatory and, notwithstanding that, are saved by the 21st Amendment, which would overthrow about 200 years of history saying that you can't discriminate against interstate commerce without a very compelling showing that the discrimination is warranted.  Or it could say these laws are non-discriminatory because of these ridiculous physical presence requirements.  Well, there is no stopping point to that principle.  States could say, “To protect our citizens from fraud, Amazon has to establish a physical presence in our state.  L.L. Bean has to establish a physical presence in our state.”  It's absurd, and the Supreme Court has rejected again and again the idea that requiring somebody to establish a physical presence to do business in a state does not violate the dormant Commerce Clause.

MR. PATE:  Thanks.  And right on time.  Brannon.

MR. DENNING: I want to thank Todd for the hard work that he's done in uncovering some things that I wish I had had the benefit of when I first wrote my article.  I was relieved, indeed, to find that we weren't actually going to have to engage in a debate.

I wanted to lay out the case for the states, and then, like Todd did, try to draw a few kind of big picture points.  Before I do that, though, I want to say that you will probably find few other Constitutional law professors who are as in love with the dormant Commerce Clause doctrine as I am. I'm a huge dormant Commerce Clause fan and think it quite possibly is one of the most important doctrines the Supreme Court has ever fashioned and enforced.  I'm also a big fan of cheap booze, and so in arriving at the position I have, I am in the relatively rare position of a constitutional law professor actually taking a position that he feels the Constitution compels him to take that is totally against his interest.

Let me lay out the case that the states are going to be making before the Court and try to explain why I think it's a compelling one.  The strongest arguments that the states are going to be able to advance and have advanced in the briefs are the text of the 21st Amendment; the case law, particularly the early case law interpreting and applying that amendment; and the congressional statutes on which the 21st Amendment was closely modeled.

The text of the 21st Amendment, as Todd has pointed out, talks about alcohol that's imported into a state for “delivery or use.”  And to do that in violation of the laws of that state violates the 21st Amendment.  It's kind of funny that the 21st Amendment doesn't actually empower the states to do anything.  Literally read, it makes importation into states in violation of their laws unconstitutional.  I don't know what the implications of that are, but it's kind of an odd way, if you really read the provision literally.  But, as Todd pointed out, the Amendment has been most often interpreted to empower states to set their own alcohol policy, and then limit out-of-staters or limit importers from coming into the state or bringing alcohol in in violation of the laws.  On the history, I think that we agree generally, although we tend to put a slightly different interpretation on the purpose behind the 21st Amendment and what the history strongly suggests.

I would suggest, and have suggested, that the purpose of this provision was both to repeal the 18th Amendment, empowering the states to take back over from the federal government their own alcohol policy, and also to constitutionalize the statutory reversal of various Supreme Court decisions applying the dormant Commerce Clause doctrine against states trying to regulate alcohol coming into their territories.  I think, based on my reading, that Congress did this with the knowledge that the powers that it was giving the states could be abused.  The authors of the Amendment understood that the power could be used to impose protectionist regimes that would disadvantage out of state alcohol producers.

The early case law that Todd referred to, the Young's Market line of cases beginning in the mid-'30s and until the late '30s, which have never been repudiated, interpret the 21st Amendment in just this way.  I don't agree that you have to go in full bore for Justice Brandeis' presumption that all bets were off when it came to alcohol.  I agree, it would be absurd to argue that states, by virtue of the 21st Amendment, could be permitted to restrict women or African Americans from importing alcohol.  You have to understand the history.  And the history was that throughout the 19th century, the Court regularly deployed the dormant Commerce Clause doctrine to frustrate state regulatory attempts.  I think that when that power was given back, through the Wilson and Webb-Kenyon Acts and then in the Section 2 of the 21st Amendment, that there was a complete redelegation of this power, which I think includes the power to regulate unwisely or abusively. 

In fact, the Young's Market line of cases present fact situations that are almost identical or very close to the fact situations that are presented by the direct shipment cases.  In Young's Market, for example, there was a state statute that imposed a $500 tax on importing out of state alcohol, but no tax needed to be paid if you were distributing alcohol that had been produced in the state.  Out-of-state producers argued that the 21st Amendment requires equal treatment.  In other words, you can ban alcohol completely, but if you allow it, then you have to allow alcohol to be brought in from out of state on equal terms with that which is distributed in state.  Justice Brandeis, for a unanimous Court, rejected this argument, and said that that argument would involve not a construction of the 21st Amendment, but a rewriting of it.  People who have sought to overturn the state structures for the distribution of alcohol have seized on subsequent cases where the Court, through some rather unfortunate loose language, seemed to intimate that the Young's Market line of cases has been totally repudiated . Actually, if you look at the facts, those later cases occur in situations that fall outside the import “for delivery or use” language that is at the heart of the 21st Amendment.  So, that's the text.  That's the case law.

Let me say a word about the Congressional statutes as well.  The dormant Commerce Clause doctrine is a default rule.  In the absence of congressional action, the Court has inferred from the grant of power to Congress over interstate commerce certain restrictions on the states' ability to regulate that commerce.  Congress, however, has the power to redelegate power to the state, which includes the power even to discriminate against interstate commerce or at least to remove the strictures of the dormant Commerce Clause doctrine in certain areas.  One area in which Congress has done this, probably the most recent example other than alcohol, is in the business of insurance.  The McCarran-Ferguson Act permitted states to regulate the business of insurance, and as the Court has said most recently in Western & Southern Life Insurance Company,14 once Congress has redelegated that power to the states, the dormant Commerce Clause is inoperative. 

There are two acts even before the 21st Amendment was ratified.  The Wilson Act and then the Webb-Kenyon Act, which came later in response to some Supreme Court decisions that had narrowed the scope of the Wilson Act and frustrated the congressional attempt to delegate power to the states.  There's an important difference between the two acts.  The Wilson had language requiring equal treatment.  In other words, it gave states the power to regulate alcohol coming into the state, but it said it had to be a regulation on equal terms with that which was produced in the state.  The Webb-Kenyon Act, which was passed to close some loopholes and reverse some Supreme Court decisions that had restricted state power, had language similar to the Wilson Act, requiring equal treatment, which was eliminated from the final version of the Act.  Section 2 of the 21st Amendment, in turn, tracks the Webb-Kenyon Act's language, which doesn't make any mention of equal treatment, and was intended to constitutionalize Webb Kenyon because there was some fear that a Supreme Court majority might overturn the decision in which it upheld Webb Kenyon and upheld the power of Congress to redelegate this power to the states.

I certainly wouldn't regard it as disastrous if the Court upheld these laws.  I think it would be ironic in a way if one of the few provisions in the Constitution whereby states are specifically empowered to do certain things were held not to convey the power that it appears to convey, consistent with the understanding of the framers, the early courts, and most federal district courts deciding 21st Amendment cases after the ratification of the Amendment. 

Second, I think it would be unfortunate for the amending process, too.  Once framers’, courts’, and states' expectations have been upset, people may say, “What's the use of going through the difficult process of proposing and ratifying an amendment if 10, 20, 30 years down the road it can just be ignored—because it's convenient, because people think that the power that had been delegated to the states has been used unwisely?  We can just go to courts and convince them that that wasn't the power that was delegated in the first place.”  I think that would be an unfortunate result for the Article V Amendment process, and would tend to strengthen the hands of courts.

Let's not make any mistake about what would result if these laws are struck down.  What courts will have to preside over is the judicial dismantling of seven decades worth of alcohol policy and seven decades word of regulatory apparatus that have been set in a large number of states.  It may be a bad regulatory apparatus.  I would certainly, if I had the opportunity, vote to tear down these three-tier closed systems.  But to have courts do it seems to me, though I dislike the term intensely, like precisely the sort of judicial activism against which so many conservatives regularly inveigh—even conservatives who are huge supporters of the free market system.

Judge Easterbrook has a great line in his Bridenbaugh opinion from the Seventh Circuit in which he turned aside a dormant Commerce Clause challenge to a direct shipment ban.  He said that the states have the power to regulate wine in ways that they may not regulate cheese.  And from my reading of the Amendment, from the cases, and from the context in which the Amendment arose, I think that's right.

MR. PATE:  Thanks, Brannon.  Let me start with a couple of questions.  It's very hard to see anything other than a very complete authority in the states to deal with reimportation in any way they see fit.  Now, you don't necessarily have to go with Todd's “in for a glass, in for the whole bottle” argument.  But at least as it goes to direct economic regulation of importation, if you're not willing to take a very literalist approach to it, where are you left?  And if you really start getting into the history, what's wrong with Todd's case that historically the point of the Amendment was really just to tell the dry states that they weren't required to have their policy against alcohol consumption thwarted by forced importation?  And if that's all you're left with, then why don't we just apply the Commerce Clause?

MR. DENNING:  That's a really good question and the stuff that Todd has written on the Volokh Conspiracy and other places caused me to think about it.  Todd deploys the textualist argument successfully to direct people to the history.  In other words, the only way you avoid the “in for a penny, in for a pound” argument is to say you've got to be specific about what the problem was that this Amendment attempt to address.  And I think that where we differ is that Todd, as I understand him, says that all of the activity took place against a baseline norm of non-discrimination, and the Webb-Kenyon Act took out that equal treatment language that the Wilson Act contained.  One response might be that everybody understood that to be the case.  When I was doing the historical research, that kind of anti-discrimination background didn't jump out at me in the materials that I looked at.

Now, it is true, and I think Todd makes this point, as well, when the Young's Market line of cases came out, there were a number of law review notes and comments that said, “This is terrible.  You're just empowering the states to engage in economic protectionism.”  And the only thing I can say is that there's at least one statement—I'll use a snippet of legislative history, a statement by a Representative Lee.  He could have been in his Senate hideaway or in his office or at the Mayflower Hotel when he submitted this to the Congressional Record, but he warns that  the power being given to the states can be abused.  I think that in balance the framers were willing to take that chance.

MR. ZYWICKI: The riddle is about legislative history more generally.  This entire history is predicated on a mind set that is completely alien to the way we think about law today, which is to say that the whole debate was about the police power.  We almost never speak of the police power these days except for Richard Epstein, who would like for us to speak about it a lot.  But the whole history is about a very robust notion of the police power and an equally robust notion that the police power could not be used to discriminate.  That's why I draw all the way back on the history of Walling that goes to the Wilson Act and to the Webb Kenyon Act.  Basically, all the legislative history is addressing the notion that what this is about is allowing the states to effectuate their police power.  I'll give you one example.  Here's what Senator Kenyon himself said in proposing the Webb Kenyon Act about the act: “...its purpose, and its only purpose, is to remove the impediment existing as to the States in the exercise of their police powers regarding the traffic or control of intoxicating liquors within their borders.”15  A strong non-discrimination principle is implicit in the entire era, as is a strong police power notion.  It's not clear today if there's anything called the police power anymore after Lawrence v. Texas.16

MR. PATE:  Since this is a case that's actually being argued before the Court, it would be prudent to turn away from this inquiry into the right answer, and to ask about the practicalities.  What’s interesting to me about it is this idea that you could go on the Internet, and find wines that you wouldn't be able to buy in your local area.  I guess the parties are concerned enough about the interests of the sitting justices that one of the briefs actually leads off—the very first sentence in the argument—“This case is not about fine and rare wines.”

My question for you, Todd, is what is the practical upshot?  The Supreme Court fairly recently has said the three-tier system of regulation is unquestionably valid.  It has declared that the so-called core purposes of the 21st Amendment include not just temperance and maybe freedom from competition, if you want to say it uncharitably, but also taxation, the ability to collect revenue.  But look at Judge Easterbrook's opinion in the Seventh Circuit; in reviewing the standing of the parties, he says everybody in this case seems to be declaring their willingness to violate the laws in question here, and to sell the wine without obtaining a permit or presumably being willing to go through the collection of taxes.  As long as all those objectives are valid, what really is the practical upshot of these cases?  What possibility is there that the ultimate result could be anything more dramatic than simply saying we'll remove the provision that allows in-state wineries in Michigan to direct ship?

MR. ZYWICKI:  The key to understanding Bridenbaugh is that Easterbrook makes a threshold determination that as applied to the plaintiffs in that case, the law is non-discriminatory.  It wasn't actually that producers wanted to sell.  It was actually in-state consumers who wanted to buy wine from out of state.  And the premise of Easterbrook's argument is that there weren't any harmed sellers who were in front of him.  So basically what he was saying is that these plaintiffs, these in-state consumers were saying that they were harmed, even though they couldn't identify anybody who actually wanted to sell them wine from out of state.  A threshold determination of Bridenbaugh was that it was a non-discriminatory law.

Secondly, I think the welfare effects are clear with respect to wine, which is that there's a substantial savings on price.  There's a dramatic increase in choice, and most dramatically what you would expect in any sort of competitive market, is that the incumbents, the bricks-and-mortar retailers, have to respond to competition.  What we've seen is increasing concentration in the wholesale market.  As small wineries have grown like topsy, there's thousands of small wineries that have developed, multiplying the choices available to consumers, the three-tier system is becoming more and more of a bottleneck, and bricks and mortar retailers are being more and more protected from competition in order to keep their prices up.

The final point is, what's the payoff?  I don't think a favorable decision would require a dismantling of the three-tier system.  What it does do is deprive state legislatures of the weasel solution.  There's no serious public policy argument here.  This kind of law is a sop to the wholesalers.  It allows states to give a sop to the wholesalers and then throw a bone to little in-state wineries and in-state consumers who want to be able to go to the New York Finger Lakes region, on vacation, buy some wine, ship it back, and sell it within the state.  If you deprive states of the weasel solution, maybe they'll ban all shipment of wine, but it's at least equally plausible that they're going to allow all wine to come in.  If nothing else, the non-discrimination principle forces them to make that choice in a more transparent way.

MR. DENNING: Todd had a hand in the FTC report that found that there really wasn't a rash of underage drinking, underage ordering over the Internet, and I guess I'm just slightly uncomfortable with saying that that has absolutely no validity.  You wonder about the consequences if Internet sales began to proliferate and not only for pinot noir and rare and fine wines, as the case put it: Beer of the Month Club over the Internet, or Wild Turkey dot com.  With the proliferation of credit cards, more teenagers have access to credit cards and certainly access to the Internet, and I'm wondering if it isn't a problem in waiting.  All I've seen are sensationalist reports from trade groups that want to keep the three-tier system in place and the FTC's evidence that this isn't as big a problem.  But it doesn't strike me as completely irrational that underaged people would, as a result of this, be able to have access to alcohol when they shouldn't.

MR. ZYWICKI:  This isn't a question about direct shipping or not direct shipping.  This is whether only the 190 wineries in New York are allowed to direct ship or whether everybody else is.  And that cat is out of the bag.  The argument that this is going to allow underage drinkers access to alcohol is gone.

MR. PATE:  Let's open the floor.  Richard Epstein?  We'll have you--you should wait for the microphone or, in your case, not.

MR. EPSTEIN:  I'm going to have nothing to say after I ask this question.  But I'll ask it anyhow.  I was listening to Todd's argument about the fact that what Section 2 was designed to do was essentially to restore or to reaffirm the ability of the state to regulate under its police power jurisdiction.  The difficulty I have with that argument is if you didn't put in Section 2, and only put in Section 1, and just simply repealed the 18th Amendment, then, in effect, it seems to me that the states' police power jurisdiction would be assured in its traditional fashion.  The dormant Commerce Clause would be there so that everything you say that Sections 1 and 2 together do is, in fact, done by Section 1 itself.  (I have a new argument that maybe Section 2 is itself unconstitutional given the U.N. Charter, but we put that aside for a moment.)  It seems to me that your argument proves too much, because it doesn't give any independent role to Section 2.

MR. ZYWICKI:  I think that Brannon and I may have the same answer, which is that Section 2 constitutionalized the Webb-Kenyon Act.  And the language is the same as the Webb Kenyon Act.  When they repealed Prohibition, the dry states were afraid that the next thing that was going to happen was Congress was going to repeal the Webb Kenyon Act.  Everybody would be getting drunk again.  There was also a concern that if re-presented to the Supreme Court, the Webb Kenyon Act would be declared unconstitutional, because it's a novel statute, and it’s unclear whether or not Congress can actually delegate its Commerce Clause authority in that way to a state.  At the time the Webb-Kenyon Act was enacted, the Attorney General rendered the opinion that it was unconstitutional at that time.  And one of the people who argued against the Webb-Kenyon Act in the Senate was Justice Sutherland, who subsequently went on the Supreme Court.

After the repeal of the 18th Amendment, dry states were afraid first they'd be cast on the goodwill of Congress to maintain Webb Kenyon, which they didn't have a lot of confidence in, given the political dynamics; and secondly, that Webb Kenyon would be cast on the will of the Supreme Court if it were re-presented, and it was by no means clear that if the Supreme Court would uphold it.

MR. DENNING:  The only thing I would add was that I found some pretty strong evidence that there were wet states, too, that wanted this as much as the dry states because they feared that the drys would gain ascendency again as they did prior to the proposal and ratification of the 18th Amendment.  They wanted to make sure that they would have their interests protected as well.

MR. ZYWICKI:  In a sense, there was something in there for wets and drys both.  At the time, if you read the articles from the New Republic or the New York Times, the country was riven by wet-dry, almost like red and blue states.

MR. STERLING:  Eric Sterling from the Criminal Justice Policy Foundation.  My recollection is that the 21st Amendment was enacted in a tremendous political situation; that it involved the presidential election.  There was a great deal of debate about it in a way that doesn't strike me as common in other kinds of constitutional amendments.  I'm curious about the actual drafters.  I have the recollection that there was a group of lawyers called the Voluntary Committee of Lawyers, who were working behind the scenes and advising the states and their constitutional ratification conventions.  Who was really involved in the drafting of this--of besides simply taking the language from the Webb-Kenyon Act?

MR. ZYWICKI:  I don't recall specifically.  What's interesting is there's relatively little debate on Section 2 in Congress.  Most of the debate is on the proposed, but never enacted Section 3, which would have given the federal government concurrent power to regulate saloons; they were particularly concerned that the saloons are going come back and corrupt us all.  I don't recall specifically who was involved other than particular Senators. But because this really just seemed to constitutionalize the Webb-Kenyon Act, I didn't see that much debate around Section 2 that was too much different than what they said about the Webb-Kenyon Act.

MR. DENNING: There's a fascinating story about the battle over the framing and ratification of the 18th Amendment.  There was a tremendous outpouring of literature right after that occurred, with people making arguments that the Amendment itself, insofar as it nationalized something that, to that point, had been considered absolutely local, so the Amendment itself was unconstitutional.  And there are two good books.  David Kyvig is an historian who's written a wonderful book called Repealing Prohibition.  And then there's another book about the regulation of alcohol, by another legal historian named Richard Hamm [Shaping the Eighteenth Amendment: Temperance Reform, Legal Culture, & the Polity, 1880–1920].  Those are both really interesting and fascinating books.  If I remember Kyvig's book correctly, he really goes into those groups of lawyers who agitated for years for Prohibition's repeal.  And you're right: it was part and parcel of the 1932 election.  The only thing I would add is that both parties were running away from the 18th Amendment as fast as they could, but that Franklin Roosevelt and the Democrats had sort of a built-in base of northeastern immigrants, particularly people of German stock and Italians and others, who, you know, enjoyed drinking and wanted to see it return.  And the western Republicans, Mid-Westerners, you know, were part of the people who had really agitated for this in the first place.

MR. ZYWICKI:  Part of what was going on was the collapse in tax revenues associated with the Great Depression.  Alcohol was seen as a viable place for especially state and local governments to go for tax revenues.  That was another reason it was very popular.

[AUDIENCE QUESTION]: Todd, I was surprised to hear your comment that both Justice Thomas and Justice Scalia embrace the dormant Commerce Clause.  I thought Justice Thomas's opinion in Camps Newfound was pretty stridently opposed to the Court's made-up dormant Commerce Clause.  Now, granted, both of them have joined or written opinions applying the Commerce Clause, but I've always taken that to mean that there's a lot of water under this bridge—not as an embrace of the dormant Commerce Clause.

MR. ZYWICKI:  What I thought I said was not necessarily that they embrace the dormant Commerce Clause, but they both embrace the non-discrimination principle.  It's clear in Camps Newfound that Thomas clearly believes there's a non-discrimination principle in the Constitution.  It's just located in the Import-Export Clause, as opposed to the dormant Commerce Clause.  Scalia, for instance, prefers to use the phrase negative Commerce Clause when he's referring to the non-discrimination principle of the Commerce Clause, and I think he's suggested it might properly be cabined in the Privileges & Immunities Clause.

The Pike stuff is where I think they see the genie is out of the bottle, and they don't want to extend it.  But I see in both of them an adherence to non-discrimination.  For instance, in the Healy case,17 Scalia specifically says in concurrence that the discriminatory nature of the law removes the protection of the 21st Amendment.  And ithe CTS case,18 by Scalia, very clearly implies that the Supreme Court should be in the business of reviewing discriminatory laws, but not non-discriminatory laws.

MR. DENNING:  Actually, I was going to correct Mike [Greve].  The last dormant Commerce Clause case the Court took was the Maine Prescription Drug Case,19 in which the Court very cursorily dismissed a fine dormant Commerce Clause argument that could have been levied against the Maine Prescription Drug Program.  The reason I bring that case up is because that's the case in which Thomas, in another case from that same Term, Hillside Dairy,20 basically announces that he will not enforce it anymore.  Discriminatory, non-discriminatory, Pike balancing—it doesn't matter.  He's decided that the dormant Commerce Clause is unwieldy, unworkable, and he's not going to enforce it.

Scalia, interestingly enough, also wrote two concurring opinions in which it sounds like he’s only going to decide dormant Commerce Clause cases and strike down state laws on the basis of stare decisis.  Now it sounds like he's limiting his position even further, only striking down laws in cases in which the facts are identical to cases that have come before.  That could embrace the anti-discrimination principle or it could just allow him to draw minuscule factual differentiations among cases. If you add up the votes in the cases here, I think that the states are going to be in a pretty good position.

MR. PATE: What do either of you make of the argument in the brief Miguel Estrada filed that since Congress did reenact Webb-Kenyon, whatever is going here, there isn't room for the dormant Commerce Clause because Congress has spoken?

MR. ZYWICKI:  From what I can tell, Webb-Kenyon was reenacted for one reason, which was that it was unclear where the legal landscape stood after the 18th Amendment, and whether the repeal of the 18th Amendment brought everything back to life or that sort of thing.   The 21st Amendment Enforcement Act of 2000 created new procedural mechanisms for states to be able to enforce their state laws against out-of-state shippers.  It's attached to the Webb-Kenyon Act, and there is a provision inserted called Rules of Construction, the clear intent of which, if you look at the legislative history, was for Congress to make the statement that Webb-Kenyon was not meant to bless discriminatory state laws.  They used sort of awkward language to do it, but if you follow the legislative history, that's how it came through.  Several members of Congress actually filed a brief in the wine case, also, in the Supreme Court, where they reassert the position that Webb-Kenyon is not a reverse delegation, but rather a positive use of congressional power to allow the states to enforce their laws.

MR. DENNING: I would just add that if the Court wanted to weasel out of this dilemma and not answer the question about whether the 21st Amendment trumps the dormant Commerce Clause, they could say that whatever the 21st Amendment does to the dormant Commerce Clause Doctrine, the dormant Commerce Clause Doctrine doesn’t apply here, because Congress has redelegated power to the states.  I hope they don't do that.

MS. WACHTELL:  Mr. Zywicki, you really had me going with a lovely argument until at the end you said, however they decide this case, it's a complete catastrophe.  It seems to me if they decided under the 21st Amendment, it's one piddly little industry that got lucky or at least the non-export in it got lucky.  And I wonder if you saw it being anything more than that in terms of other industries?

Mr. Denning, I didn't quite follow whether your argument was that the states need no argument in order to support this, no rationale other than it's written into the Constitution or that they only need a rather weak rationale.  The latter sounds a little more like what you were saying and more cogent.  In other words, if we can save six children from becoming alcoholics in the State of North Carolina, it doesn't matter how much money is saved to consumers.  That strikes me as the kind of thing that Congress would do and maybe the Constitution would do and would support, in light of the sense that this industry is so sui generis.

MR. ZYWICKI: I'll grant the point.  It would be less disastrous if they decided narrowly on 21st Amendment grounds than if they adopt the Second Circuit reasoning, which I think could be really catastrophic.  So, I would say that the harm to the republic would be still present, but perhaps less if they blessed discrimination only in this context, depending on what kind of language they use and how much they allow.  What I'm concerned about is that the states are going to be able to wave their hands, and instead of producing real evidence, produce the kind of junk that they actually have in their briefs, which is hand waving.  The Supreme Court has been very good and very rigorous about saying you have to demonstrate real evidence.  If the Supreme Court can draw that line again, and basically say the 21st Amendment creates a narrow exception, that would not be that bad.  But to the extent that the Court gives credence to these very poor justifications for discrimination that the states have advanced, I think that could have real negative effects for other Commerce Clause cases.

MR. DENNING:  The states have said this helps us promote temperance.  I've always thought that's a crappy argument.  But the second thing is taxes.  State alcohol regulation does preserve a revenue structure that could be circumvented with direct shipment, in the way that sales taxes can be evaded through Internet sales.  Finally, I think that there is a non-frivolous, although not terribly strong, argument that state law could help at least stop some enterprising underage drinkers. 

If you eliminate the dormant Commerce Clause, I think we're back to a rational basis standard.  The question becomes whether a reasonable legislature could have believed that those good benefits would flow from its regulatory structure.  Although hopeful signs have shown up in some other cases regarding economic regulation, I think still the rule is generally as long as the Court can hypothesize good things that flow from state regulation, it doesn't matter whether those are present or not.  In my ideal world, that would not be the rule, but I think that's the rule right now at least outside the Sixth Circuit and outside the funeral home directors world,21 but I think that that would be a much easier argument for the state to make.

JUDGE WILLIAMS:  I may have misunderstood what you were describing as the basic thrust of the 21st Amendment.  You made it sound as if the evil perceived was feds involved in local law enforcement, which makes it sound as if the feds were inefficient—but compared to what?  Compared to state law enforcers?  It would seem to me that the more obvious explanation is just the basic federalist principle that states ought to be allowed to make their own trade-off between the evils of abuse and the evils of crime. 

A second issue is the balancing under Pike, which seems to me essential to screen out forms of discrimination that were not formal and obvious.

MR. ZYWICKI: I agree with your characterization of Pike.  Pike says, “balance the benefits inside the state to the harm outside the state.”  I think that Pike is most useful in providing a proxy for discrimination: if the costs dramatically exceed the benefits, we can probably infer that it's a discriminatory law.  That's not exactly how the Supreme Court has characterized it.  They've characterized Pike as a wide open balancing test, and this is where I read Scalia and Thomas ridiculing it. 

With respect to your question about the failure of Prohibition, there's a lot going on.  What comes out of legislative history is that most of that discussion arises in the context of the proposed, but never enacted, Section 3, the saloon amendment.  The proposal was there to have the federal and state governments have concurrent authority over saloons.  But concurrent authority really means federal authority because of the Supremacy Clause.  That's what happened under Prohibition: the feds displaced the states because of the Supremacy Clause.  And if you enact Section 3, it's going to just bring the feds back, meddling in saloons.  The next thing you know—and you see this in Wagner's speeches—the feds are going to be setting closing times, and they're going to be setting who can drink where.  So, you see both aspects, the practical as well as the jurisdictional.  The Federal Government can't run this operation because they don't want to invest the resources, and that tells us why we have usually left the police power in state and local hands. 

THE DOPE ON THE COMMERCE CLAUSE

MR. WARREN: Viet Dinh is a Professor of Law and Co-Director of the Asian Law and Policy Studies at Georgetown.  Viet was, as you all know, an Assistant Attorney General for Legal Policy in the Bush Administration from 2001 to 2003.  And he claims to be very much involved in the Patriot Act.

MR. DINH: I don't claim that.

MR. WARREN: This is a part of a conspiracy, as I understand it from the New York Times, because Viet Dinh clerked for Judge Silverman.  According to the New York Times, always able to sniff out a conspiracy, in one famous meeting in the Justice Department, nine out of fourteen participants were Silverman law clerks.  He also clerked for Justice O'Connor.

John Eastman, I have known forever.  John was a student of mine at the University of Chicago (and Richard Epstein’s as well, I'm sure).  John clerked for Mike Luttig , and then for Clarence Thomas.  He was an associate briefly until he decided to go to academia, where he's been at the Chapman University School of Law since 1999, and he is the director of the Claremont Institute's Center for Constitutional Jurisprudence.  He has become a true gadfly in litigation, as I understand it, over constitutional issues.

I think this is a great case, a fun case to talk about, and it's much simpler to describe than the case that Hew had to describe.  California has a statute called the Compassionate Use Act, which is intended "to ensure that patients and their primary care givers who obtain and use marijuana for medical purposes upon the recommendation of a physician are not subject to criminal prosecution.”  And that recommendation can be written or oral.  It's a very open-ended statute which you would expect only in blue states.  But there are about a dozen states that have enacted similar statutes, including Alaska and Montana.  So, this is not just a blue state issue.

In this case, we have the perfect plaintiffs.  We have plaintiffs who are seriously ill, incapacitated, tried all kinds of drugs.  They don't work.  They are using only home grown marijuana.  There's no interstate argument about these marijuana plants.  The plaintiffs had the good fortune of having the DEA come in and seize six of their marijuana plants—otherwise, there would be serious ripeness issues in this case, and there may still be some justiciability problem, but it looks pretty good. 

This statute comes right up against the Controlled Substances Act, which has been on the books since 1970.  Under that statute, Category 1 substances (including marijuana) are banned, and Congress has made findings that Category 1 substances are substances that have a high potential for abuse; that have no currently accepted medical use in treatment in the United States; and where there is a lack of an accepted safe use of the drug or other substance under medical supervision.  So the findings of Congress seem to come right up against what California is saying.  In addition, the Controlled Substances Act makes a number of findings, including that local distribution and possession of controlled substances contribute to a swelling of the interstate traffic in said substances.  Controlled substances manufactured and distributed intrastate cannot be differentiated, and federal control of intrastate incidence of the traffic in controlled substances contributes to the effective control of interstate drug traffic.  So that's the clash.

Viet is going to speak first, and John is going to speak second, but I thought I would just frame the questions that it seems to me they both have to answer.  Viet: quoting Judge Sentelle, in a case involving interstate commerce, said it's neither interstate nor commerce.  As only Judge Sentelle could say it, he quoted the old chestnut, "If we had some ham, we could fix some ham and eggs, if we had some eggs."22

[Laughter.]

John, the dilemma you face is equally daunting because, under this California statute, you need a prescription of some kind, oral or written.  As I watch television, getting prescriptions, say for Viagra, is not exactly the hardest thing in the world.  Doesn't this really amount to the proposition that anyone who wants to use marijuana, who is in possession of marijuana, if they've gotten a wink and a nod from a physician, is in the clear?  And isn't it a fact that we're really talking about possession of marijuana in California as coming outside the ambit of federal law as a consequence of this compassionate use statute?

MR. DINH:  I'm not sure I am completely 100% on board with the government's position.  I will start by articulating the government's position, and in some respects, advocating it.  But I’ll also offer you a first cut at evaluating its merits, and then turn it over to John Eastman to give us the natural implications of the government's position in Commerce Clause jurisprudence.

The dissent below by Judge Beam and the primary argument in the Department's petition and the brief relies heavily, if not exclusively, on Wickard v. Filburn.  And the argument goes, heck, if poor Filburn were growing marijuana instead of wheat, there's no question that the Court would validate the restrictions on his activity.  I don't think that that is going to be a particularly persuasive argument, especially after Lopez.  I read Lopez as basically restricting Wickard v. Filburn to its facts.  I think the fact that it is marijuana and drugs in this case will sway at least one important vote in the court.  But the argument is much more refined, and I think it will come out much more clearly in oral argument.

The rejoinder to the Wickard v. Filburn line of argument is, “That's fine, but there Congress was trying to regulate interstate commerce.  Here, there is no interstate commerce in marijuana because of the effect of governmental regulation.  There is no market for marijuana, and so therefore there's no corresponding impact on the national market from subsistence production as there was in Wickard v. Filburn.”

I actually think that argument works the other way.  If Congress has the ability to restrict trade all together, and therefore to prohibit the black market, if you will, of marijuana, then it is a stronger argument than, say, in Wickard, in which Congress arguably can be characterized as trying to prevent a gray market that would work to diminish its regulation of the primary market.  Here, what Congress is trying to do is prohibit all together, and so therefore the prohibition of intrastate production for subsistence purposes should be prohibitable.  Here the argument is very, very subtle.  It is the same argument that the government has made in the child pornography context, and it is primarily one of enforcement.

If Congress has the power—which it undoubtedly does—to prohibit outright interstate movement and production of marijuana, and marijuana is an international and national product that is fungible in nature, it is impossible for the government to enforce this prohibition by allowing for a vibrant or any black market in marijuana.

In the child porn context, especially over digital pornography, the defense is that this does not use an actual live child, but rather just a pixalation by computer programmers.  And since there are no primary effects to the use of minors, it is pure speech and therefore should not be prohibitable under the traditional child pornography statutes.  That's a very difficult problem to get over, and so the Department argues to Congress that we have to be able to create some sort of rebuttable resumption in order to get at the true problem of child pornography using an actual child.  Of course, the argument is strengthened in this context because you do not have an independent operation of a constitutional protection, like the 1st Amendment, to protect against the overbreadth.  Here, it is just a straightforward exposition of congressional power under Article I, Section 8.  But I think analytically the argument remains the same.

If the Necessary & Proper Clause means anything, it must give Congress the additional power to institute enforcement measures in order to regulate pursuant to substantive authority under the Commerce Clause of Article I, Section 8.  And so the Necessary & Proper Clause, allowing for the proper enforcement of the admittedly permissible regulation of interstate movement of marijuana is, at the end of the day, probably the best argument that the government can make.

It is the best argument.  It is not, however, necessarily an analytically clean argument because the natural question is, why can't you make everything a movement in interstate commerce?  You recall the Chief's opinion in Condon23 a couple of years back where he said driver information is "a thing" in interstate commerce, and so Congress properly regulates that thing in interstate commerce—so with cereal, so with wheat, so with anything, any product that can be a thing in interstate commerce.  If government then seeks to ban such products, then the argument would go, Congress would have the enforcement power to ban interstate production and consumption of that product, also.

I guess the rejoinder to that is simply a structural one.  It's one thing to regulate, but it's quite another thing to ban a product outright together, and the political process works best when such a ban is instituted.  It is not an entirely persuasive argument to distinguish between regulation and banning, but there is some practical reality to the fact that the electorate would rise up much more in response to an outright ban of a particular product than to its simple regulation.

Whatever the outcome of this analysis is, one aspect of the case and of the Ninth Circuit opinion is troubling to the analysis for the respondent: two of the plaintiffs here are people who grow marijuana in order to distribute to the admittedly very sick and very sympathetic plaintiff who actually needs it for medical purposes, and the Ninth Circuit injunction is to permit such distribution also.  So it's not just simply the production and immediate consumption for personal use, but the actual distribution of marijuana across the economic units.  So there is “commerce,” in a way.  It depends on what the dying patient gives in reciprocity to such distribution, but one can imagine love and affection being able to be an adequate compensation.

MR. WARREN:  A smile?

MR. DINH:  Exactly, free love for such a distribution.  And so there I think the argument is much harder; that is, it is a commercial transaction, with respect to distribution, and the only thing that justifies it is this so-called medical necessity.  But you’d have to explain why is there is a medical necessity exception to what normally would be the ordinary Commerce Clause analysis.  I think that the case would be much stronger had it been just one plaintiff for consumption without any distribution.  The way it is phrased, I think that it may well give the Court an easy way out without deciding the central issue that we have in this case.  The really interesting issue is, what if Filburn were growing marijuana instead of wheat?

MR. EASTMAN:  I want to add a few things to your description of the case.  Not only were the perfect plaintiffs here, but I think we also had the perfect judge.  That this comes from Harry Pregerson I think really defines a little bit of the dynamic of the case.  The jokes about the Alt 9 macro of the Supreme Court are true: “This case comes from the Ninth Circuit, and there are three other reasons it ought to be reversed.”  Your description of the statute I think is also good, but it leaves out something.  We can have oral or written prescriptions.  But I think even prescriptions by smoke signal would be permissible.

[Laughter.]
I want to take up your challenge directly: with prescriptions being so easy, isn't this really legalized possession and doesn't that make it a much tougher case for me?  I actually don't think it does.  I don't think the fact that this was a medical exception in the California statute matters one iota to the constitutional argument.  If California wanted to go further and legalize simple possession, without any connection with interstate commerce, it would be allowed to do so.  I think that's part of the reason Mike has brought me in here.  I'm from California.  I even wore my Jerry Garcia tie to defend this position.

[Laughter.]
But let me make a disclaimer.  I never have smoked, and I'm not a fan of the California policy.  I think it's terrible policy, but I also am a big fan of California's right to do this.  As you get into the opinion, what's most interesting to me is that I think both Judge Pregerson in the majority, and Judge Beam in dissent, are absolutely correct--both of them.

Judge Pregerson goes through a very careful, thoughtful, and analytically accurate application of the four factors in Lopez—unlike most other courts in the country that have been looking at Lopez challenges to a variety of federal statutes.  And the majorities in all of these Commerce Clause challenges are ducking the careful Lopez analysis that Judge Pregerson engages in here.

If you go through that analysis, this is not economic activity.  We're talking about homegrown marijuana, for personal use.  There's nothing economic about it.  There is no jurisdictional hook.  (A lot of the courts in the country, when they admit that there is no jurisdictional hook, they then go in and say, the courts will substitute their own jurisdictional hook when the statute lacks it and just completely write that element of Lopez out.)   There are also no specific findings on this particular subject.  The courts have been ducking that issue, too.  Generic findings are good enough—even though the Supreme Court in Morrison came back and said they’re not good enough.  The same ignoring of the Supreme Court's rules has existed since Lopez and Morrison.  And the lower courts, almost uniformly, except for Judge Pregerson here, have been just ignoring the rules from those cases.

And then, of course, there’s the notion that this is too attenuated.  You can't read the government's brief, its five-step analysis to get to some connection to the Commerce Clause, without understanding the joke that the attenuated prong of Lopez has become.  Judge Pregerson doesn't permit that.  He engages in a very serious application of the Lopez factors and comes out and says, "Therefore, I've got to uphold California's law and strike down the federal Commerce Clause statute."

Now, why does he do that?  Is Judge Pregerson a big defender of the Lopez line of cases?  I don't think there's anybody in this room, certainly not me, who thinks that.  This is an "in your face" gauntlet to the Supreme Court.  Unfortunately, I think because of the facts of this case, because we're talking about the Controlled Substances Act and the law and order crowd, I think Judge Pregerson may have called the Court's bluff.  As a result, we're not going to get the Court embracing Richard Epstein's view that Wickard's got to go.  We're going to get the Court watering down what little remains of Lopez and Morrison, I fear.  I hope I'm wrong about that, but that's my prediction.

Now, I said that both Judge Pregerson and Judge Beam were equally correct, and they're on opposite sides of the case.  How can that be?  Well, Judge Beam says persuasively, correctly, that Judge Pregerson's decision absolutely conflicts with Wickard.  He's absolutely right.  And I think what he's demonstrated to us is what the court in Lopez and again in Morrison was not willing to admit: taken seriously, taken logically, the holdings in both of those cases amount to an overruling of Wickard.  The majority has gone out of its way to say, "We're not touching Wickard." That is simply dishonest.

Now, Wickard is still on the books.  So Judge Beam, in dissent, says you can't do this without striking down Wickard, and the Court says we can't do that.  But you also can't apply the Lopez holding faithfully, consistent with Wickard.  So they're both right, and they have presented to the Court the utter conflict in its reasoning in both Lopez and Morrison: How can you have a Commerce Clause that has any limits at all but keeps Wickard v. Filburn on the books? 

Wickard is not economic activity, really.  True, I’ve argued before the D.C. Circuit that it’s economic and Morrison says it was economic in a way that carrying a gun to school for sale in Lopez was not.  But the real problem here, and I think Justice Thomas in Lopez had his finger on it, is that the substantial effects test, when combined with the aggregation principle, taken seriously (and not even to their logical extreme) mean that there is absolutely nothing that Congress cannot regulate.  That's the challenge presented to the Court with this case, and Judge Pregerson knows it.  And he, I think rightly, suspects that the Justices not going to be up to the task.

Look at a couple of broader issues that this case also presents to us.  We've gotten to the world now where nobody in Congress takes seriously their constitutional obligation before they vote on a statute and where the Executive signs statutes, combined with a signing order that says, "I believe this to be unconstitutional."  And when we get to the Court, the Court is now deferring to the constitutional judgments of the political branches with such a degree of deference that none of the three are ever engaging in the constitutional inquiry.

What's most striking to me about this case is the government's vigorous defense, not just how this is consistent with Lopez, but with a much broader understanding of Wickard than even the Wickard Court put out.  And this is coming from a conservative administration.  They're taking a position in their brief that is a broader understanding of the commerce power and the federal government's authority under the commerce power, than any brief I recall having been filed by the Clinton Justice Department.

The broader question I have is, whose oaths are being followed and whose are not?  Does the executive have any independent obligation to make assessments of constitutionality either in its enforcement decisions or in the positions it takes before the Court?  And if it doesn't think it has any independent obligation to assess constitutionality, is it appropriate for the Court to be giving such a level of deference to the positions taken by the Department of Justice?

I think, first, executive officials do have an obligation, and they need to revisit that.  There is a way to do this without completely throwing off the obligation to represent your agency.  We could have two-tiered briefs.  You could have a brief that says, “Under existing precedent, such as Wickard v. Filburn, this statute is applicable or it can be upheld.  But Wickard v. Filburn was called into question in Lopez, and in fact a faithful application of the Constitution, which we are independently obligated to advance, says that Wickard v. Filburn was probably wrongly decided.  And, in fact, the Court at the time that it rendered that decision was in the habit of really not paying much attention to the Constitution at all.  So we ought not to take the fact that the Court in Wickard has said this is okay as a carte blanche.  Now, we'll continue to rest on the argument that Wickard is there, but encourage you to revisit that.” 

I would think that would be a more appropriate role for the Department of Justice in a case such as this.  It has taken that role in the past, but it has not done so in the last four years, and I hope we get to the point where it will start doing so again.  Otherwise every single decision of the Court that is not grounded in the Constitution becomes a carte blanche, forever more, with nobody ever challenging it and nobody taking the independent obligation of their oath to the Constitution seriously.

That, it seems to me, is the more critical challenge presented by this and a lot of other cases that have come down since Lopez.  Is Lopez just going to be the anomaly that scholars all over the country that didn't like it have claimed it was and that those of us who really liked it but couldn't get cert in any of the 100 cases following have feared that it is?  Judge Pregerson is fairly confident that his little case here is going to make Lopez just that anomaly.

This is not a regulation of commerce.  You cannot look at the findings by Congress and think anything other than that this is a raw exercise of police power using a Commerce Clause hook.  Finding number two: “The illegal importation, manufacture, distribution, and possession and improper use of controlled substances have a substantial and detrimental effect on the health and general welfare of the American people.”  That's a police power purpose.  That's not a Commerce Clause purpose. 

It's not like these little marijuana plants, even in commerce, are going to blow up and destroy whatever other commodity is sitting next to them; It’s rather, the feds say, that we can't differentiate possession by Ms. Raich and possession by somebody who’s actually brought their marijuana across state or international borders.  Well, so what?  If not aimed at regulating commerce, it doesn't matter whether we can differentiate or not.  If marijuana is possessed in California, it's subject to California's police power not to the federal government's police power, because they don't have one.  So that claim, as well, is one aimed at a police power purpose, not a Commerce Clause purpose.

The one purpose that is arguably a commerce clause purpose is actually 180 degrees opposite of the argument that was made in Wickard v. Filburn: that by not buying wheat on the interstate market, Farmer Filburn depressed the interstate market in wheat.  Well, here, it's that by home-growing their own marijuana, they are swelling the interstate market in marijuana.  You can't have it both ways.  Again, the purpose that they have articulated, in defense of this Commerce Clause hook, is so pretextual I think you've got to conclude that this is a reach to a police power purpose that is improper.

You don't get there with the Necessary & Proper Clause either, however much the Department of Justice wants it to.  When the end is not a commerce purpose but a police power purpose, you can't use the means to get to the illegitimate end.  McCulloch decided that a long time ago.  It would be the solemn duty, and painful duty, of this Court to say that that's a pretext and to strike down that statute.  I think that's the right result here.  I fear we're not going to get there.

MR. DINH:  I think John misunderstands my argument.  The end is the regulation of interstate movement or nonmovement of marijuana, and the means is the prohibition of domestic or intrastate production and distribution because the product is fungible.  In the end there is clearly legitimate interest in the ban on interstate movement of goods, and the fear is that the domestic production would make that ban unenforceable.  So it's not as easy as McCulloch v. Maryland.

With respect to the Department of Justice, you make a very good point.  However, the analysis is a little bit more subtle.  Let's take a case in point--the Campaign Finance Reform Act.

MR. EASTMAN:  That's what I was thinking of.

MR. WARREN:  As was I.

MR. DINH:  It doesn't take a genius to request an opinion from the Department of Justice on the constitutionality of McCain-Feingold.  And it doesn't take a genius to say that the Department of Justice is taking its time in order to respond to such requests for the constitutionality.  Why?  Because once Congress passes a statute, then it has that presumption of constitutionality, and the Department of Justice has a duty to defend that statute subject to its obligation to the Court to present only reasonable arguments.  Also you don't want to tie the hands of the president for political purposes by opining prematurely on the constitutionality of a pending bill.  If you have only an unreasonable position, your duty to the Court is not to defend that statute, which, by the way, Ted Olson has done several times with respect to one statute, portions of which I argued in favor of: the Family Medical Leave Act.  Ted sent a letter to Congress saying, “We will not defend X, Y, and Z, in light of this case, that case and the others.”  So he has exercised that authority.

But in presenting its arguments to the Court, the DOJ has to weigh whether or not this argument is reasonable in light of this precedent.  So it meets this competing duty that is independent of the duty to adjudicate, as an initial matter, whether or not it's constitutional because, in that position, the SG is both advocate and tenth justice.  And the best articulation of this problem is probably Seth Waxman's articulation of how he dealt with the 30-501 problem in that context.

MR. EASTMAN:  I think the presumption of constitutionality goes out the window when the authors of the bill are admitting on the floor that it's unconstitutional.  They just don't know how many parts of it the Court is going to strike down.  And I think it goes out the window when the president, in signing, has his signing statement that acknowledges its unconstitutionality as well.  I don't think you get a presumption of constitutionality out of such thing.  And I think the independent oath, both of the solicitor general and the president, doesn't allow you to do those kind of things.  The law has got to be faithfully executed not just executed no matter what.

MR. WARREN:  But let's bring it back to marijuana--

[Laughter.]

I could get going on campaign finance, and we would never stop.  Let me pose to you both this question.  First of all, if I read Judge Pregerson's opinion, one of the two plaintiffs, Monson, the one whose marijuana plants were confiscated, actually grows her own marijuana.  So there is no distribution in that case.

With Raich, I think there's no compensation, other than a smile and a thank you, I think, from Raich to the people that are growing the marijuana for her.  I think, even in her case, that it would be a great extension of the Oakland Cannabis24 case to see this as distribution.  But Oakland Cannabis raises the question that I want to pose for both of you: it seems to me that affirming the Ninth Circuit is easy, but are we going to get an opinion from the Court?  Because we had three justices in the Oakland Cannabis case who basically said this is Lawrence v. Texas.  This is personal privacy rights.  Justice Breyer did not participate in the case.  He may very well go along with that.

I mean, are we going to get an opinion from the Court in this case?

MR. EASTMAN:  I hadn't thought through the full implications of that until just now, and it hits me like a brick.  I would much rather have them sell us out on Wickard v. Filburn than to find a constitutional right to smoke pot along the Lawrence v. Texas.

MR. WARREN:  I'm only presupposing there's four votes.  There are four justices who are reluctant to go down the Lopez-Morrison road, but, on the other hand, are very sympathetic to the plaintiffs and are likely to say, "Affirm on these grounds."  And so then the question is, do you really have five votes to get an opinion from the Court?

MR. EASTMAN:  No, but you're right.  Because there is nothing in the lower court's opinion that addresses it on those terms, and I don't think it's within the—

MR. WARREN:  Parties talk about it in the briefs.

MR. DINH:  Both issues are presented, right?

MR. EASTMAN:  Yes.

MR. DINH:  At the end of the day, as I've said, the government's argument merges into the medical necessity argument, and they can go one of two ways.  I think the medical necessity argument is utterly incomprehensible, except if you find a personal right to smoke pot.

MR. WARREN:  I think that it's a little different than the medical necessity argument, though, because it seems to me the medical necessity argument goes by the by with Oakland Cannabis.  It seems like to me the argument is more, look, this is in your home, marijuana which you have grown.  This is privacy at its essence, and if you can do certain other things in your home, why can't you do this?

MR. EASTMAN:  I think this just shows how wrong Lawrence was.  Leave the states to regulate their own health, safety, welfare and morals free of the federal hand, and you'll get some states that make crazy decisions and other states that make sound decisions, and over time the sound decisions will prevail.  You won't get all of that debate and experimentation with a single federal rule.

MR. WARREN:  Let me ask one more question.

Viet, as I listen to you, and honestly as I read the SG's brief, I say this sounds like a field preemption case.  They're really basically saying we've got this comprehensive statute, and we've got all of these findings, and there's just no business for the states to get into this.  And yet this isn't a preemption case at all.  It's a Commerce Clause case.  And once you start posing the question in terms of commerce, then I think Judge Sentelle's description of the problem is apt.

MR. DINH:  You are absolutely right.  You put your finger on the weakest point of the argument, both in terms of the failure of a pervasive federal regulation in order to justify a core Section 8 authority and also the fact that the preemptive scope of CSA is not as clear as one would think.

I think that's why, ultimately, it will have to rise or fall on this question of an attack on federal enforcement authority, which, as I articulated, may well argue too much.  I'm sure Richard will comment on this, but frankly, we've seen this Court, and particular justices who shall remain nameless simply really change their minds on the advent of these cases.

MR. EASTMAN:  The one thing that I hold out on that question, and that I think is good in the Department of Justice brief, is they are taking more seriously than has been taken in a long time the line between the direct commerce power and the means power in the Necessary & Proper Clause.  And they actually cite them separately, which is fairly rare.

What I think that's going to tap into is a discussion that we get out of a majority of the court in Printz v. United States, when Justice Scalia, striking down the Brady bill, makes that distinction.  And then he engages in the two-part inquiry that the Necessary & Proper Clause actually asks us to engage in: is it necessary, as broadly or loosely as we want to define that?  And there's lots of ways you could do your enforcement mechanism shy of regulating all possession or banning all possession—greater border enforcement, both interstate and international border.

But even if you accept a broader—

MR. DINH:  Wait.  Except in the most populist state in the union, you know, there's free love.

MR. EASTMAN:  But that means it's no longer about the commerce, but it's about people actually using marijuana in the state, and that's the police power and not the commerce power.  And then it seems to me the second part of that inquiry, which Scalia elaborates well in Printz: is it proper to so intrude on a state's own exercise of their police power?  And I could see “necessary” being a close call.

MR. WARREN:  I think it's about time to let some of the actual participants in the audience participate officially.  So who would like to be first in the audience?  Richard?

[Laughter.]

MR. EPSTEIN:  Let me just go back again to the history.  If you're trying to figure out where John is coming from, and it's a place that I'm sympathetic with: I assume your argument necessarily predicates that the old lottery case, Champion v. Ames25 was wrongly decided.

MR. EASTMAN:  That's correct.

MR. EPSTEIN:  If it's rightly decided, then, in effect, everything that you have said disappears on that ground.

MR. EASTMAN:  Yes.

MR. EPSTEIN:  For those of who don't remember what Champion v. Ames was, it was the question of whether or not, when you ship lottery tickets from one state to another in interstate commerce, Congress could ban the shipment notwithstanding the fact that they weren't going to leak pollution on the tracks of trains running in interstate commerce.  And the issue then became, did it make a difference whether these tickets were illegal in the place from which they went or the place to which they were going, or did it not matter at all?  The Eastman position—which I have a lot of sympathy for, mainly because I think it's correct—is that it doesn't matter what's happening at either end.  Congress can't touch it.  If it's illegal in the place in which it is shipped, then they can punish you.  If it's illegal in the place to which it's going, then they can punish it, but the feds are essentially out.  There is no general federal police power.  If that's the case, then it seems to me that the federal government doesn't have the power to stop trafficking in marijuana unless and until you can show that it has damages to the vehicles that are carrying the marijuana.  So your argument was, well, the feds can still stop the stuff at the border.  If you really believe in Champion v. Ames, they can't.

MR. EASTMAN:  They can help Nevada stop it at the border if Nevada doesn't want it coming over.

MR. EPSTEIN:  I don't believe that.  Where do they get the auxiliary police power if they don't have the independent police power?  If Champion is wrong, it seems to me the government is out of the anti-trafficking business.

MR. EASTMAN:  All right.  You've convinced me.

[Laughter.]

MR. EPSTEIN:  I think that's right, but understand this is not undoing Wickard.  You're undoing Champion v. Ames, which was a five-four decision and was wrong.  I mean, you make me look like a timid conservative.

MR. EASTMAN:  I've been trying, you know.

[Laughter.]

MR. DINH:  He makes you look like a liberal.  Nobody can ever make you look timid, Richard.

[Laughter.]

MR. EPSTEIN:  But don't shrink from it.  It's probably right.

MR. EASTMAN:  I think it's right and it goes back to, What's the purpose?  McCulloch insists that we ask this question:  Is it a police power purpose for which they're using a Commerce Clause hook as a pretext?  Then they don't get to do it.  If it's a commerce purpose, then they get to do it.

MR. DINH:  The question here, because now we're talking about trafficking, is the exact same question that pervades the entire Commerce Clause analysis, which is why I have some sympathy for Justice Thomas's denunciation of the effects test.  On the one hand, John's position is separate from the fact that he is arguing against Champion v. Ames.  But there is no clear line all the way to the position where I said was the weak point of the  Department of Justice's argument—where they can ban anything that can potentially move in interstate commerce.  The only restriction on it is a structural political one, and anywhere within that spectrum, you really can't have a principled line, unless Richard has a flash of brilliance.

MR. EPSTEIN:  I do.

[Laughter.]

JUDGE WILLIA