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THE RIGHT TO EARN A LIVING

Cato Institute

Chapter One

This book is intended as a general overview of the legal status of the right of individuals in the United States to engage in gainful trade, whether as entrepreneurs, investors, corporate directors, or otherwise. It is not intended as a thorough explanation or defense of that right in philosophical terms; that task has been undertaken by many others. For our purposes, it suffices to say that the right to earn a living through trade or labor is as much a legitimate aspect of one's liberty as the freedom from bodily restraint, the right to marry, to study, to raise one's children, to travel, or to worship as one chooses; indeed, courts of an earlier generation frequently grouped these rights together when listing examples of constitutionally protected freedoms. But a brief look at that right will help us understand its nature and why it is imperative to defend it in the nation's courts.

In 1848, a free black man named Willie Winfield appeared before the Tennessee Supreme Court. Winfield had been jailed under a Memphis ordinance that prohibited blacks from being out in public after 10 o'clock at night. Arrested as he walked home from work, Winfield was fined $10, but he appealed, arguing that the law he had been arrested under was unconstitutional and void. Surprisingly for a slave state in the decades before the Civil War, the court agreed with him. In a decision by Justice William B. Turley, the court observed that if such a law had been enforced "against a free white person, public indignation would have been aroused, and the [city] would not only have been sued to recover back the fine, but also for false imprisonment." And although free black people were "not, it is true ... citizen[s] of full privileges in our state," it was still unjust to subject them to such laws:

The lot of a free negro is hard enough at best, resulting from necessity arising out of the relation in which he stands to his brethren who are in servitude, and it is both cruel and useless to add to his troubles by unnecessary and painful restraints in the use of such liberty as is allowed him. He must live, and, in order to do so, he must work. Every one knows that in cities, very often, the most profitable employment is to be found in the night, loading and unloading steamboats and other craft, waiting about hotels, theaters, places of amusement, both public and private, wood-cutting, fire-making, shoe and boot-cleaning, not to mention the various handicraft employments, such as that of the barber, etc. All these things are sources, in large cities, of much profit to the free man of color, and you necessarily deprive him of them entirely if you compel him, like a wild beast, to hide his head in his den from ten o'clock till daylight, under the penalty of being pursued by watchman and constables for the purpose of being imprisoned and fined as if he had been committing a crime against society.

Justice Turley and his colleagues cited no cases in reaching their conclusion. Instead, they stood on what they saw as the commonsense proposition that a person has the right to earn an honest living for himself and his family, and as long as he doesn't harm anybody in doing so, no third party—and no government—should interfere with that right. This conclusion was not based on any economic theories but on simple moral philosophy and a long-standing tradition about what it means to be free—a tradition they evidently considered so pervasive that providing citations and arguments to support it would have been superfluous. In short, the justices recognized that the right to earn a living is a central component of the liberty that makes a free person free. Just as liberty means the right to speak one's opinions or to pray in accordance with one's religion, so free people have the right to engage in productive enterprises to support themselves.

Turley was right. As a legal matter, the right to earn an honest living can be traced far back in the English common law. Almost two and a half centuries before the Winfield decision, England's chief justice, Sir Edward Coke, wrote that the Magna Carta and the common law protected the right of "any man to use any trade thereby to maintain himself and his family." A century later, that right, which Coke saw as a traditional right of Englishmen, was among those that America's Founders regarded as the natural rights of all humanity. The right to "pursue and obtain happiness and safety," as Virginia patriot George Mason wrote in 1776—or the right "to pursue happiness," as his friend Thomas Jefferson would put it only months later—is fundamental to human life. Pursuing happiness, of course, means more than the right either to possess things or to engage in those pursuits that make us happy—such as educational or recreational projects or spending time with friends and family. It also means the right to take steps to provide a better life for oneself through work, trade, and commercial enterprise.

A contemporary of Willie Winfield put a very human face on this right in his memoirs. Born a slave, Frederick Douglass recalled how he escaped the home of his master Hugh Auld, reaching New York on the Underground Railroad in 1838. Walking the streets of Rochester, looking for a job, Douglass came across a house where a pile of coal had just been delivered. He had an idea that he might make some money, and he knocked at the door, offering to move the coal inside for the woman who answered. "I was not long in accomplishing the job," he wrote, "when the dear lady put into my hand two silver half dollars. To understand the emotion which swelled my heart as I clasped this money, realizing that I had no master who could take it from me—that it was mine—that my hands were my own, and could earn more of the precious coin—one must have been in some sense himself a slave.... I was not only a freeman but a free-working man, and no Master Hugh stood ready at the end of the week to seize my hard earnings."

Like Justice Turley, Douglass understood the moral case for the individual's right to earn a living: All human beings face certain obstacles in their existence, including limited time and resources, and the need to obtain subsistence and shelter. Nature does not give these things to man; he must earn them through his own effort, or obtain them from others who have expended effort. Either way, his survival and that of his children depend on the creation of wealth, through the productive work of his mind and body. And if morality is to be a guide for human survival, it must place special emphasis on those productive virtues by which such wealth is created. When Master Hugh took away the fruits of Douglass's labor, he was asserting the power to control the essence of Douglass's humanity—his creative faculty—and thus treating him as a tool or as an inanimate object instead of as a fellow human deserving of freedom. As Douglass's friend, the abolitionist and U.S. senator Charles Sumner explained, the "ever present motive power" of slavery was "simply to compel the labor of fellow-men without wages," by "excluding them from that property in their own earnings, which the law of nature allows, and civilization secures.... It is robbery and petty larceny under the garb of law," which presumed "that for his own good," the slave "must work for his master, and not for himself."

The existence of slavery in America—an institution whose essential moral corruption Abraham Lincoln described as "the same old serpent that says you work and I eat, you toil and I will enjoy the fruits of it"—was an intolerable contradiction from the nation's beginning. That contradiction manifested itself socially and economically in the difference between the industrious, enterprising North and the class-structured, static South. Another contemporary of Douglass, Alexis de Tocqueville, remarked on this difference in his Democracy in America when he noted that in the slave states "one might say that society has gone to sleep ... man is idle," but in free states "a confused hum proclaims from afar that men are busily at work, ... man appears rich and contented; he works.... On the left bank of the Ohio work is connected with the idea of slavery, but on the right with well-being and progress; on the one side it is degrading, but on the other honorable." Thus, from an early age, the practical consequences of economic freedom were clear—but they were consequences of a moral challenge faced by all humans: whether to devote themselves to earning a living through productive enterprise, or to subsist off the compelled labor of others.

Although the legal institution of slavery was swept away with the Civil War, many of its political and cultural legacies remained. One important step toward fixing that problem came in 1868, when the Constitution was amended to protect the "privileges or immunities" of all Americans, including their common-law right to earn a living. Where southern states had enacted discriminatory laws to limit the economic opportunities of former slaves, Congress enacted the first national Civil Rights Act to ensure that all people "shall have the same right ... to make and enforce contracts," and to "purchase" and "sell ... real and personal property." Only a few years later, Supreme Court Justice Stephen J. Field would explain that the right to go into business without being stopped by "disparaging and partial" laws is "the distinguishing privilege of citizens of the United States. To them, everywhere, all pursuits, all professions, all avocations are open without other restrictions than such as are imposed equally upon all others." This right, he concluded, "is the fundamental idea upon which our institutions rest." Government may regulate businesses to protect the general public, of course, but Field contended that when laws served simply to protect one business against competition by another, or interfered with the right to earn a living without actually protecting the public welfare, such laws violated "the right of free labor, one of the most sacred and imprescriptible rights of man."

Myths about Economic Liberty

But flash forward to 1992, a century and a half after the Winfield decision, and we find a prominent legal scholar writing the following:

I do not count the Supreme Court decisions defending contract or property rights from state regulation as Bill of Rights decisions. None of these cases represents a defense of civil liberties. The Court merely used libertarian philosophy to protect the wealthy from progressive legislation. The Court eventually rejected these economic liberty decisions because they were not connected to the text of the Constitution or any philosophy with roots in the history and traditions of our nation and its democratic process.

This statement is unfortunately typical of the attitude of the present-day legal academy toward the right to earn a living—a right that Justice William O. Douglas once called "the most precious liberty that man possesses."

In fact, most modern legal academics who have discussed the history of American law have contended that judicial decisions upholding contract and property rights were in some way a betrayal of constitutional values. These academics have forged a consensus view that economic liberty was, in fact, concocted by ideologically biased 19th-century judges who acted as "a de facto arm of the capital-owning class," and who "invented, through a flash of revelation known only to them, the notion that due process of law ... protected corporations against social legislation." Nineteenth-century judges, claims one prominent legal historian, "recognized only the 'liberty' of powerful corporations and sweatshop owners." Still another charges that Field and his colleagues were concerned only with rights such as "property and economic liberty," because these are the "freedoms that matter most to people at the top of the heap." These tool-of-capitalist judges allegedly used "constitutional legerdemain" to incorporate the "root-hog-or-die theory of capitalist enterprise" into the Constitution, thus replacing the "originally humanistic doctrines of liberal democracy." Only with the great judicial shift of the 1930s, when the courts dramatically turned away from protecting economic liberty, was "true" democracy restored to the American political system. In fact, this theory continues, economic liberty is not actually liberty at all. The right to engage in trade is simply a privilege that deserves little or no judicial protection. Legislatures and administrative agencies should be free to regulate economic matters in virtually any way they wish.

This book challenges that consensus and documents some of the legal and historical issues surrounding the right to earn a living. Although I presume that free markets tend toward greater economic efficiency and more just outcomes than do centrally organized or government-controlled economies, and that free individuals make wiser economic decisions than do government bureaucrats, this is not primarily a book on economics, and it is important to emphasize that point. A great many of the writers who have criticized the economic liberty decisions in American law—and particularly the decisions associated with the so-called Lochner era—have claimed that the judges in such cases were motivated by a commitment to certain "economic theories" and to the writings of Adam Smith, Herbert Spencer, and John Stuart Mill. The term "economic substantive due process" was coined to describe these decisions, as though the judges who wrote them were focusing on questions of supply and demand, or inflation, surplus, trade balances, and the like. A parallel accusation is that the judges in the "laissez-faire period" were "social Darwinists" who believed that the poor ought to be left alone to suffer and die off, thus ridding society of (in Ebenezer Scrooge's immortal words) "the surplus population."

Doubtless there were some social Darwinists in the 19th century. But the judges who decided the economic liberty cases—whether they be Sir Edward Coke in the Case of Monopolies or Justice Turley in Winfield, or Justice Field in his many decisions, or Justice Rufus Peckham in Lochner v. New York—were not among them. Hardly a word of social Darwinism appears in their writings, and it seems likely that the only Supreme Court justice of his day who was familiar with the doctrine was Oliver Wendell Holmes Jr., who famously dissented in Lochner. Indeed, modern historians have questioned whether "social Darwinism" is even a meaningful term; the phrase was devised by leftist historian Richard Hofstadter, who used it as an epithet against free-market economists and sociologists he disliked, whether or not those thinkers actually had any affinity for Darwin, and it is often used to describe people who stood on different sides of ideological issues. In fact, as Louis Menand explains, "What looks like Social Darwinism" during this era "was generally just a Protestant belief in the virtues of the work ethic combined with a Lockean belief in the sanctity of private property. It had nothing to do with evolution."

Nor were the judges who supported economic liberty writing from an "economic" perspective. Although many of them were well versed in the economic literature of their day, these judges rarely relied on or cited such books. In fact, in the years before the New Deal, the Supreme Court cited Adam Smith in only four cases, one of which was merely as a historical note about a law to which Smith had referred. More to the point, the decisions modern historians describe as "economic substantive due process cases" were not about economics but about legal, moral, and political philosophy. They involved questions about the definition of the word "liberty," about the meaning of justice and the limits of rights, and about whether government interference with economic choices was legitimate, given certain constitutional protections. So, too, this book is based on two propositions: (a) the freedom to make one's own economic decisions is not primarily rooted in economics but in political philosophy and (b) a free society is not a matter of efficiency but of justice.

In his book The Return of George Sutherland, Hadley Arkes emphasizes this point in reference to the 1932 case of Adkins v. Children's Hospital. When it was decided, Adkins became the focus of a battle over the Constitution's protections for economic liberty, and that case's reputation has sunk in the years since. Supreme Court Justice David Souter even claimed that Adkins bore "the echo of Dred Scott," the infamous case that precipitated the Civil War. But no libel could ever be more misplaced.

(Continues...)

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Excerpted from THE RIGHT TO EARN A LIVING by TIMOTHY SANDEFUR Copyright © 2010 by Cato Institute. Excerpted by permission of Cato Institute. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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