President Trump speaking at a podium with Vice President Pence behind him. They are at a press conference to announce the "Opening of America" Plan

President Trump recently claimed “absolute authority” to open the U.S. economy by forcing states to lift restrictions governors have imposed by proclamations and executive orders to combat the spread of COVID-19. A few days later, he shifted from claiming absolute authority to releasing a plan for re-opening the economy that allows Governors to decide how to implement the plan in their respective states. The plan has met with mixed responses. Some Governors have started lifting restrictions. Others have been reluctant to do so until adequate testing and preventative measures are in place. The President has been very vocal about his desire for the economy to re-open. The question is: what will he do if Governors and Mayors continue to leave restrictions in place? To what degree can he force states to lift restrictions and jumpstart the economy?

POWERS OF THE FEDERAL GOVERNMENT, PRESIDENCY, & STATES

There are two checks on presidential power. One is horizontal: checks and balances, between the political branches (and the courts) The other is vertical, through federalism. Article II of the US Constitution confers specified, enumerated powers to the President. Beyond that, he is limited to Congressional delegations of power. Unlike the individual States, which exercise plenary police powers to protect public health and safety, the Federal government is one of limited and enumerated powers. 

The Tenth Amendment further reserves State sovereignty and provides protection against the encroachment of Federal power over State and local actions. But even that is checked in the Constitutional order. The Supremacy Clause to the U.S. Constitution says that Federal law “shall be the supreme Law of the Land . . . any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” However, the Supremacy Clause is widely understood as applying only to areas wherein the Federal government is exercising its constitutionally enumerated and implied powers.

The Supreme Court has established a clear prohibition against attempts by the federal government to commandeer states to further its own agenda. In New York v. United States (1992), Justice Sandra Day O’Connor explained that although “Congress has substantial powers to govern the Nation directly” the Constitution does not “confer upon Congress the ability to require the States to govern according to Congress’ instructions.” Justice O’Connor further wrote:

We have always understood that even where Congress has the authority under the Constitution to pass laws requiring or prohibiting certain acts, it lacks the power directly to compel the States to require or prohibit those acts. The allocation of power contained in the Commerce Clause, for example, authorizes Congress to regulate interstate commerce directly; it does not authorize Congress to regulate state governments’ regulation of interstate commerce.

Thus the constitutional rules are clear: the Federal government cannot directly compel the States to pass certain laws or act in accord with the Federal government’s policy agenda. And this includes, as the Court established in Murphy v. NCAA, a prohibition on Federal laws that forbid States from legislating or acting in a certain way. In Murphy, the Court invalidated a federal requirement that prohibited States from overturning their existent sports gambling prohibition laws — with Justice Alito, writing for the majority, explaining that the Federal government could neither “compel a State to enact legislation” nor forbid “a State from enacting new laws.” As such, regarding the COVID-19 pandemic, the Federal government can neither order those States with stay-at-home orders to repeal those orders nor dictate that States with no such orders refrain from issuing any future stay-at-home orders.

Yet all this case law predominately pertains to the legislative powers wielded by Congress. The Executive Branch is even more constrained in this regard. As noted above, the executive branch receives powers from two places, the Constitution and Congress. In the Youngstown Steel case, Justice Robert Jackson’s famous concurrence outlined Presidential power into three levels:

  1. The President’s authority is strongest when acting on express or implied delegation from Congress. 
  2. It is at its weakest when acting against the express or implied will of Congress. 
  3. Finally, the President is operating in a “zone of twilight” when Congress is silent on the issue. 

For the Youngstown case, the Supreme Court found that President Truman’s seizure of steel mills during the Korean War fell under this last category and exceeded the President’s constitutional authority. Any action by President Trump, without the express or implied authority of Congress, ordering businesses back to work in defiance of State laws would thus be presumptively unconstitutional much in the same way the Court viewed President Truman’s actions in Youngstown.

Thus, while President Trump claims plenary authority to order the States to reopen their economies, reversing stay-at-home orders and business closures, the Constitution and Youngstown say the opposite. The President cannot order the States or their localities around like underlings. Rather power is divided within our Federal system.

While both the President and Congress lack the power to directly order the States to reopen their economies, the Federal government could try directly ordering businesses and individuals out of their homes and back into active commerce. Under Jackson’s concurrence in Youngstown, the President’s power is at its strongest when acting under Congressional authorization. A direct order to individuals and businesses could come from the Commerce Clause power under  Art. 1, § 8, cl. 3, of the Constitution. The Commerce Clause, a legislative power, allows the federal government “to regulate commerce…among the several states.” To invoke this power, the President would need Congressional authorization. In theory, Congress could find that stay-at-home and business closure Executive Orders that Governors have made interfere with interstate commerce. The orders might then be found unconstitutional by a reviewing court.

The problem with the Commerce Clause power? First, given the political realities, with the House in Democratic hands, and the Senate in Republican hands, it is unlikely that Congress will pass a law that would attempt to compel businesses to reopen.  Beyond that, there is the case law. 

Under U.S. v. Lopez (1995) which delineates modern Commerce Clause jurisprudence, state stay-at-home and business closure restrictions certainly substantially affect or substantially relate to interstate commerce. The Lopez test allows the federal government to regulate people or things in commerce, even though the threat may come only from intrastate activity. While purely intrastate activity might seem beyond the scope of the Commerce Clause, the court has upheld regulation in  Wickard v. Filburn (1942) (wheat grown for home consumption) and Gonzales v. Raich (2005) (marijuana grown for home consumption).The outer limit seems to be the situation of economic inactivity that was the subject of the Affordable Care Act case, NFIB v. Sebelius. There the Court found that the federal government cannot regulate inactivity in the market — sanctioning the failure of individuals to purchase health insurance. The Commerce Clause, the Court found, does not give the federal government the ability to force individuals to participate in the market. While Sebelius involved the federal government’s attempt to regulate a single industry, President Trump’s effort to jumpstart the entire economy might also be viewed as an effort to regulate economic inactivity. Additionally, Sebelius involved forcing people to make a purchase, in that case, health insurance. Here, the government would not be forcing people to purchase anything — rather it would be asking them to go back to work as businesses and stores reopen, in order to restart the economy.

Yet even after attempting to meet these hurdles to Commerce Clause power, the President would still need some form of Congressional authorization to compel businesses back to work. One potential source of Congressional authorization is the Defense Production Act (DPA). Under this law, the President is allocated broad authority to manage the economy during times of war and other crises. The pertinent part of the DPA empowers the President with the ability to compel businesses to accept and prioritize contracts “deem[ed] necessary or appropriate to promote the national defense,” as well as “to allocate materials, services, and facilities in such manner, upon such conditions, and to such extent, as he shall deem necessary or appropriate to promote the national defense” (50 U.S. § 4511(a)). Under this text, the President could conceivably issue an order for certain businesses to perform contracts that include provisions requiring certain closed businesses to reopen and return to pre-pandemic activities. 

Yet the DPA closely narrows this power in regards to the “civilian market” — the President can only exercise such powers over the civilian economy if it’s determined that (1) the material being regulated is “scarce and critical material essential to the national defense” and (2) these relevant national defense requirements “cannot otherwise be met without creating a significant dislocation of the normal distribution of such material in the civilian market to such a degree as to create appreciable hardship” (50 U.S. § 4511(b)). So under these limitations, it is very unlikely that the President could use the DPA to order all businesses back to pre-pandemic work activities. However, President Trump has recently invoked the DPA, specifically citing § 4511(b), to order that meatpacking plants remain open during this pandemic. The President argues that having these plants remain closed “undermined critical infrastructure” and negatively impacted the food supply chain. Yet this recent exercise of DPA power seems dubious at best: not only is it not clear why this type of meat production is “scarce and critical” and “essential to the national defense,” but it’s also questionable whether the President’s goals of protecting the food supply chain could not otherwise be met through other means, especially in light of the recent incidence of COVID-19 among workers at these meatpacking plants.

POWER OF THE PURSE: CONDITIONAL SPENDING

In addition to Commerce Clause powers, the Constitution grants Congress “the power to lay and collect taxes…to pay the Debts and provide for the common Defence and general Welfare of the United States,” Art. I. § 8, cl. 1 of the Constitution. Congress, under the Spending Power, could empower President Trump to make conditional grants of funding to the states. The Presidency, through Executive Agencies, plays a role in the execution and administration of funds.

Recently, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a $2 trillion stimulus package creating over $150 billion in funds to states and local governments to aid in battling the effects of COVID-19. When it passed the CARES Act, Congress did not stipulate that states must lift their quarantine restrictions at any point in order to be eligible for funding. President Trump could ask Congress to amend the act to include such conditions or, should Congress issue another stimulus package similar to the CARES act, use a veto threat to force the additional aid package to include stipulations requiring states to lift their stay-at-home orders.

But at the end of the day, the President must act pursuant to Congressional authority under the Spending Power. To act outside of Congressional authority, would be a violation of the constitutional doctrine of separation of powers. Once the CARES Act passed, the President is required to execute it as is. Under the bicameralism and presentment clause, as discussed in Clinton v. City of New York (1998), the President cannot change legislation when it has passed both houses of Congress. He can either accept it as is or reject it and send it back. He has already signed the CARES Act, so he is bound by the requirements in the Act. He cannot add or take away.

Furthermore, any attempts by the Trump administration to condition CARES Act funding on State cooperation with economic reopenings appear even weaker in light of a number of recent federal court rulings striking down the Department of Justice’s effort to condition Byrne Grant funding on State cooperation with federal immigration authorities. In the most recent of these cases, the 7th Circuit made clear, in City of Chicago v. Barr, that States “do not forfeit all autonomy over their own police power merely by accepting federal grants,” and that although the executive branch has significant powers, “the power of the purse is not one of them.” Specifically, the court explained that “the power to wield the purse to alter behavior rests squarely with the legislative branch.” In other words, absent clear Congressional authorization — authorization that has not been granted in the CARES Act and is likely not to be granted in subsequent relief legislation — the President cannot unilaterally add conditions to grant funding for the States.  

Yet even if the President were theoretically granted authorization by Congress under a new COVID-19 relief package to condition funding on the States reopening their economies, the conditional funding in this theoretical relief package would still not likely pass constitutional muster. Such an act would fail the four-pronged test that the Court outlined in South Dakota v. Dole (1987), which found conditional funding constitutional only where:

  1. The funds are spent in pursuit of the general welfare;
  2. The funding conditions are unambiguous so that states are making an informed and knowing choice in accepting or rejecting the funds;
  3. There is a relationship between the federal interest and the conditions imposed on funding; and
  4. No other constitutional provisions bar the states from accepting the conditional provisions.

This theoretical relief package would likely meet the first prong of the test (i.e., addressing the negative effects of COVID-19 would be in the “general welfare”). Yet such legislation would need to be carefully crafted to meet the other prongs of the test. Its conditions must be unambiguous on what is required of the State recipients; for example, the legislation could clearly express that States must remove their stay-at-home orders or business closures in order to receive the Federal funding. Clear conditions like this in a theoretical new relief package would also pass the third prong of the Dole test, as the Federal interest of such legislation (economic revitalization) is strongly tied to the desire for States to reopen their economies. Meeting the final prong of the Dole test would depend more on the specifics of such theoretical legislation. For instance, would such a relief package include conditions requiring or compelling employees back to work? If so, would such an act implicate any constitutional rights? The answer is certainly open for debate.

And yet, even under the extremely unlikely scenario of Congress passing a new COVID-19 relief package that authorizes the President to condition funding on State reopenings, and even if such legislation were to meet the prongs of the Dole test, this theoretical legislation would, at the end of the day, likely fail the anti-commandeering doctrine, as outlined in cases such as Printz v. United States (1997), New York v. United States, and Murphy. As the Court reasoned in Sebelius,  the amount of funds being offered by the Federal government cannot be so coercive as to go beyond pressure and amount to compulsion, thereby, forcing the states to implement federal policy without a choice.

In Dole, the highway funds being withheld amounted to about five percent of the funds otherwise obtainable under specified highway grant programs. The Court did not find this to be coercive. However, in Sebelius, when the federal government conditioned Medicaid funding on states accepting and administering the ACA expansion and all the conditions that came with it, the court struck down the conditional provisions. The Court held that the amount of Medicaid funding being withheld amounted to compulsion and coercion, equating it to holding a gun to the states’ heads, as Medicaid funding made up more than 20% of the average state budget.

If the CARES Act has been any indication, the COVID-19 response will require massive amounts of funds from both the state and the federal government. Further stimulus packages may be necessary as the fight goes on and if they are in the same ballpark as the CARES package withholding money to achieve an extrinsic policy goal would definitely amount to coercion. But even though the Court only looked at the numbers in Sebelius and Dole, it might be worth it to also consider the context. COVID-19 is a global pandemic that has already claimed thousands of lives and counting. Considering the devastating impact that COVID-19 has had on states like New York where supplies such as ventilators are in short supply, very few, if any, of the states that have been heavily impacted are in any position to refuse federal funds. In a situation such as this, at least at this point, it would seem that any conditional grants would be seen as coercion. 

Therefore, despite President Trump’s talk of total authority to force States to reopen their economies, in reality, there are few constitutional avenues available to him to compel them to do so. Neither the President nor Congress can directly compel the States to lift restrictions nor compel businesses to reopen under any existing legislation. Congress would need to pass new legislation delegating to the President clear authority to condition funding to the States on economic reopenings. But with the House currently in Democratic hands, this is extremely unlikely to happen. And even if such theoretical legislation were to be passed, its constitutionality would still be greatly suspect. For, in a time of a global pandemic and economic crisis such conditional funding in any COVID-19 aid package would be nothing short of coercion. It would be, as Chief Justice Roberts described the Affordable Care Act’s conditional Medicare funding in Sebelius, “a gun to the head” of the States — and therefore unconstitutional.

 

Michalette Haywood and William Rice are Student Research Assistants for the Georgetown Project on State and Local Government Policy and Law