Are the rights of states unfairly impacting commerce?

August 30, 2001 10:28 AM

Are the rights of states unfairly impacting commerce? It isn't just Ford selling used cars that is being curtailed, kafkaesque laws regarding the direct shipment of alcohol across state lines also result in less consumer choice. Where is the middle ground?
posted by machaus (12 comments total)

Why are you unfairly imputing a fine member of this site? :-]

But seriously, as a UK person this looks just like the EU, with the ammount you can take duty free between countries set at a certain ammount. Not sure if that's a good or bad thing really.
posted by nedrichards at 10:42 AM on August 30, 2001

machaus: Not as long as states have to pay for roads, no. Alcohol, you can talk all you want about -- it's mostly a taxes and morality thing, although so much, if not most, violence does involve alcohol use in some fashion. But the states are asked to pay for roads, and they of course police the highways, etc. Certainly the states have interfered plenty with interstate commerce throughout the nation's history - combined with the handling of racial issues in the post-Civil War-to-Civil-Rights-Movement era it's the biggest strike against federalism - but you're mostly barking up the wrong tree here.
posted by raysmj at 11:14 AM on August 30, 2001

I totally disagree. The internet broke open every other barrier to trade for electronic services, so why must we continue to live in a world of decreased competition and enforced monopolies, thanks to backroom deals by state trade lobbyists. The genie is out of the bottle, and failing to see the hypocrisy is detrimental to our economy. There are two situations going on here. One is the large corporation that wishes to expand its market share. That may not always be good for the consumer, granted. The other side of things is the consumer (especially in rural areas) that wishes to have more choice in the goods and services they purchase, but are hamstrung by state laws. Let me give you an example. In Virginia, I cannot purchase a bottle of wine from a California vineyard that does its own distributing. If I want to buy a similar bottle of wine, it will be purchased by my retailer from a distributor that has an enforced monopoly on selling that brand of wine in my region. Why should a business with a competitive internet advantage be unable to sell their product to people in their own country? Competition is good.
posted by machaus at 11:51 AM on August 30, 2001

I don't see where a negative impact on commerce should be the determining factor on whether or not I can have California wines shipped to my apartment in New York. In fact, I'm painfully tired of the scarecrow of "bad for the economy" and "harmful to commerce" being reasons I'm encouraged to support, or not to support, anything. There are too many inter-related factors for commerce to be the final factor that determines whether we, as a people, are for or against anything. Cash in hand is not, and should not, be the way I judge good or bad.

"Harmful to commerce" is not the natural, negative opposite to any trade regulation, just the same way as "consumer choice" is not the natural postive, beneficial opposite of a monopoly (or, again, any trade regulation); and "states' rights" are not the natural negative, harmful opposite of Federal government (or, once more, any Federal regulations).
posted by Mo Nickels at 12:04 PM on August 30, 2001

machaus: The lobbying thing is an entirely separate issue from the effects of federalism. Auto manufacturers and others have lobbied Congress to get state environmental laws preempted, etc., but lobby state legislators when it's too their advantage. In any case, lobbying can be just as corrupt, if not more so, at the federal level, or so rumor has it.
posted by raysmj at 12:20 PM on August 30, 2001

*categorically denies any responsibility*


good lookin' out, ned!
posted by Kafkaesque at 12:28 PM on August 30, 2001

"bad for commerce" actually means "bad for the retailer". Certainly, in both the Ford case and the wine case (bad pun, sorry) the real reason the situation exists is purely and simply retailers in the varous States of the products lobbying the crap out of their State legislators. Mind you, would I be too cynical in suggesting that for "lobbying" you could substitute the word "bribing"?

Interesting one of the issues that was fought over when Australia was federated was free-trade between the States. Fortunately, in that case the free-traders won and the States don't have the same powers to restrict trade between States. Nor do they have the power to level taxes.

I don't understand why the US persists in acting more like a conglomeration of independent States rather than a nation. Actually, with the power exercised by local government authorities, the term independent States is possibly too generous. A better description might be independent City States - wierd.
posted by Option1 at 12:52 PM on August 30, 2001

Option1,

Not sure if you're American or not, but the reason it acts liek a conglomeration of independent states is because, constitutionally, it *is* a conglomeration of independent states. Local control of certain things makes people happier with what they recieve from a government.
posted by Kevs at 1:36 PM on August 30, 2001

Whether you like it or not, when Prohibition was repealed by passage of the 21st amendment, the new rule was this:

The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited

So the states can do whatever they want in this regard.
posted by Steven Den Beste at 1:39 PM on August 30, 2001

Hi Kevs, I'm an Australian now resident in the US. I understand the that it's because of the constitution, but I still think it's weird. Especially when you take into account the costs of a triple layered level of taxation.

Not having the ability to tax doesn't mean that the States in Oz have given up control on everything.
posted by Option1 at 1:41 PM on August 30, 2001

Option1: Local governments in the United States have only the powers that states grant them in their own constitutions, or feel like giving them via delegation. Dillion's Rule, an early federal court ruling, is still the law here: What the states giveth, they can taketh away. However, there is still a tradition of local autonomy in the U.S. The case is much the same in Switzerland. Some local governments still have power in some states than others, nevertheless. It is interesting to note, meantime, that "home rule" charters for local governments are strongly advocated by progressive urban policy activists and the most au courant wonks these days.
posted by raysmj at 2:08 PM on August 30, 2001

To defederalize the United States you'd have to write a new Constitution. The political climate right now, however, would dictate that the new one would end up with a weaker central government, closer to the Confederate States of America constitution, and there are those who'd love to go all the way back to the Articles of Confederation -- mainly because it would take away the right of the central government to tax. So realistically, that ain't gonna happen.

I don't quite understand what Texas's beef is here. The website acted as a referral device; the legal sale took place through a dealer. I think the objection is on behalf of non-participating dealers, somehow, but it's definitely a sandcastle legal effort. Centralized sales and referral systems are going to take over the role of local dealerships, and certified pre-owned vehicles are a new and modestly booming category. The real problem is that almost all of the US manufacturers have more dealers than they need, and Ford especially has a goal of cutting dealerships by something like 25% nationally over a period of years. So this is really more of a proxy fight for that dispute than it is a hallmark of legal trends.
posted by dhartung at 6:22 PM on August 30, 2001