Monopolies and the Constitution: A History of Crony Capitalism

By Calabresi, Steven G.; Leibowitz, Larissa C. | Harvard Journal of Law & Public Policy, Summer 2013 | Go to article overview

Monopolies and the Constitution: A History of Crony Capitalism


Calabresi, Steven G., Leibowitz, Larissa C., Harvard Journal of Law & Public Policy


III. MONOPOLIES AND STATE CONSTITUTIONAL LAW

Though the federal Constitution does not have an explicit antimonopoly provision, such provisions are included in nineteen state constitutions today. (516) Only two states had antimonopoly provisions at the Founding. (517) By 1868, five states included antimonopoly provisions, and several others included prohibitions on the granting of exclusive privileges or immunities. (518) Provisions were also added in state constitutions after 1868, including in the Progressive Era. (519) Some of the more recently added provisions appear to be primarily, or even exclusively, concerned with prohibiting private monopolies; (520) however, many states use similar language to that found in the provisions between the time of the Founding and 1868, when a ban on monopoly meant only a ban on a government grant of privilege. (521)

Some of the state constitutional provisions banning monopoly are broadly worded to prohibit any unequal grant of privileges or immunities to certain citizens or classes of citizens. (522) Others, however, are more narrowly worded and prohibit only the grant of monopolies or of exclusive privileges. We will focus here on the narrower state provisions, which expressly ban monopolies and exclusive privileges.

This Part discusses the roots of the state constitutional tradition of bans on monopolies, which derives in part from the Jacksonian aversion to monopolies and grants of special privilege discussed below. (523) We then discuss the adoption of state constitutional provisions in three distinct periods: (1) at the Founding, (524) (2) during the nineteenth century, (525) and (3) during the progressive era. (526) Next, we will discuss the interpretation of these state constitutional provisions in state courts during the twentieth century and the influence of federal constitutional law and treatment of economic liberty cases on state court decisions. (527) Finally, this section concludes by discussing potential reasons not all states have included provisions prohibiting monopolies and grants of special privilege today. (528)

A. A Tradition Rooted in Jacksonian Democracy and Changes in Corporate Law

State constitutional prohibitions on monopolies and the granting of exclusive privileges are closely tied to the States' traditional prohibition of partial and special laws which developed during the antebellum era, (529) as discussed in Part II.C above. During this period, state courts routinely struck down laws granting special benefits or imposed special burdens on persons or classes of people. (530) Prohibitions on partial or special laws in some form were included in nearly every state constitution during the first half of the nineteenth century. (531) This state constitutional tradition was closely tied to the Jacksonian conception of democracy.

A central tenet of Jacksonian democracy was that the state should not establish monopolies or grant special privileges to particular individuals or classes of people. (532) President Jackson opposed the second Bank of the United States in part because it had monopoly powers. Jackson argued that "'great evils to our country and institutions ... might flow from such a concentration of power in the hands of a few men irresponsible to the people.'" (533) One of Jackson's journalists wrote that "'[a]ll Bank charters, all laws conferring special privileges, with all acts of incorporations [sic], for purposes of private gain, are monopolies, inasmuch as they are calculated to enhance the power of wealth, produce inequalities among the people, and subvert liberty."' (534) Another wrote, "'To have the land scattered over with incorporated companies, is to have a class of privileged, if not titled, nobility.'" (535)

However, President Jackson's opposition to corporations in the 1820s and 1830s should not be viewed by modern readers as an opposition to corporations as they exist today. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Monopolies and the Constitution: A History of Crony Capitalism
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.