The Constitution Is Not a Suicide Pact

On Saving the Federal Reserve Board

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“The Constitution is not a suicide pact,” it is sometimes said.

It is worth keeping that idea in mind, because it helps to illuminate a number of Supreme Court decisions, including Trump v. Cook, which upheld Congress’ authority to create an independent Federal Reserve Board.

The phrase comes from the great Justice Robert Jackson, who wrote this:

“There is danger that, if the Court does not temper its doctrinaire logic with a little practical wisdom, it will convert the constitutional Bill of Rights into a suicide pact.”

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Okay then. The case was Terminiello v. Chicago (1949), and it involved an angry, even enraged speech in front of a large crowd that was “angry and turbulent.” As the Court put it, “Petitioner, in his speech, condemned the conduct of the crowd outside and vigorously, if not viciously, criticized various political and racial groups whose activities he denounced as inimical to the nation’s welfare.”

He was convicted of breach of the peace.

The Court held that the breach of the peace ordinance was unconstitutional, because it prohibited constitutionally protected speech. The Court said that the ordinance “permitted conviction of petitioner if his speech stirred people to anger, invited public dispute, or brought about a condition of unrest. A conviction resting on any of those grounds may not stand.”

Justice Jackson dissented. He thought that the Court ignored reality. In his view, the Court paid too little attention to the consequences. He said that the lower court “was dealing with a riot, and with a speech that provoked a hostile mob and incited a friendly one, and threatened violence between the two.” He offered a lot of details about what Terminiello actually said. It’s pretty rough stuff. Jackson thought that it would predictably cause violence.

Thus his words: “The choice is not between order and liberty. It is between liberty with order and anarchy without either.” With a “little practical wisdom,” we must temper “doctrinaire logic.”

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Now turn to the independence of the Federal Reserve Board.

In Trump v. Slaughter, the Court insisted that the Constitution creates a unitary executive, with the president entitled to remove all high-level officials in charge of implementing federal law. It follows that the Federal Trade Commission, the Federal Communications Commission, and many others must be subject to presidential control.

But what about the Federal Reserve?

In Trump v. Cook, the Court went out of its way to say that the independence of the Federal Reserve is permissible. It pointed to history, saying that members of the founding generation “knew from experience (and Hamilton reminded them) of the calamities that could arise from even the ‘suspicion’ of political manipulation of monetary policy. So when they established the First Bank of the United States, they guaranteed its independence from Presidential control. Their successors did the same for the Second Bank.”

Hmmm.

Here’s the problem. As the Court well knew, the First and Second Banks were not a lot like the modern Federal Reserve. They did not have anything like its functions. So is history really authoritative here?

The Court hedged:

It is true, of course, that this tradition has not stood still; as Justice Thomas notes, the Federal Reserve is more powerful than its predecessors, managing a vastly more complex economy in a vastly more complex world. We see no reason, however, why our central bank ought to be “trapped in amber” any more than any other aspect of our constitutional scheme. What matters is that the Federal Reserve remains “consistent with the principles that underpin” the First and Second Banks—namely, that monetary policy should not be subject to political interference. In our view, the Federal Reserve maintains the “balance struck by the founding generation” under “modern circumstances.” We thus look to history not as an end in itself, but (as we often do) to give “essential content to undefined provisions in the frame of our government.”

Maybe, but also gosh. The Constitution is not “trapped in amber”? Other aspects of our constitutional scheme are not “trapped in amber”? Are we speaking of a living Constitution? Do we invoke broad “principles” and look to history only to inform the content of “undefined provisions”? Is that what we do?

The broad idea “that monetary policy should not be subject to political interference” is not something that you can just read off the founding era. The founding generation did not embrace that large idea (though its members did not also reject it).

What the Court is doing is producing a broad principle that is not incompatible with the history — but that cannot be found, as a kind of fact, in anything that the founding generation said or did.

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I suggest that a plausible justification of what the Court is doing here is simple. It is recognizing a particular danger — the “danger that, if the Court does not temper its doctrinaire logic [about the unitary executive] with a little practical wisdom, it will convert [Article II of the Constitution] into [something like] a suicide pact.”

In other words, the historical precedents for the modern Federal Reserve are not that strong, and they are not really motivating the Court. To identify a likely motivation, consider this question: Does the Constitution forbid Congress from immunizing monetary policy from presidential control? If you have a little practical wisdom, that question answers itself. (The answer is NO.)

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Thar is a speculative suggestion, to be sure. But consider these words from the majority opinion, which support the speculation: “We see no reason to leave the public in limbo, or to sow doubt as to the status of one of our Nation’s (and the world’s) most important financial institutions.”

Or consider Justice Kavanaugh’s highly pragmatic argument:

Leaving that question open would create significant uncertainty about whether the Court might soon eliminate the Federal Reserve’s independence, and thereby expose the Federal Reserve to political influences and jeopardize the efficacy of U. S. monetary policy. Even temporary uncertainty about the status of the Federal Reserve could spark political upheaval, including confusion about whether the President could immediately remove multiple Governors at will, as well as turmoil in the U. S. and world economies. I would not go down that road. I would not risk destabilizing the U. S. economy just so that we can further mull over an issue that, in various permutations, we have been thinking about for many years. As the Court’s opinion explains and the Government agrees, the Federal Reserve occupies a unique role in the U. S. Government and maintains critical responsibility for the stability and success of the U. S. and world economies.

Justice Kavanaugh does not speak of suicide pacts. But he comes pretty close, referring explicitly to “turmoil in the U. S. and world economies.” He’s making an argument about practical necessities.

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It would be unfair, and excessive, to say that the use of the First and Second Banks, in Trump v. Cook, is pretty desperate, the equivalent of a port in a storm. But it would not be unfair to say that the Court’s analysis is brisk and thin, and that it seems motivated by a sense of what’s essential.

Justice Jackson’s plea - for tempering doctrinaire logic with practical wisdom - is sometimes being heeded in opinions that seem the most doctrinaire. Practical wisdom, or what majorities on the Court take to be that, sometimes runs the show.

Archibald Cox, the great law professor and Solicitor General, was once asked what made him such an effective lawyer before the Supreme Court. He answered: “First you have to make them want to agree with you. Then you have to show them how.”