April 14, 2015

The First Amendment, Commercial Speech, and Adam Smith

Robert Post and Amanda Shanor, both of Yale Law School, have published Adam Smith's First Amendment at 128 Harvard Law Review Forum 165 (2015). Here is the abstract.

From the time of the New Deal, it has been black letter constitutional law that purely economic regulations should be subject to review under the deferential rational basis standard. This was the meaning of consigning Lochner v. New York to the anticanon. In recent years, however, this constitutional principle has come under severe strain because plaintiffs have begun using First Amendment protections to challenge basic economic regulations. They have sought to transform the First Amendment into a powerful engine of constitutional deregulation.

In this article, we argue that using the First Amendment for this objective contradicts the Amendment’s fundamental democratic purpose. First Amendment freedoms create a protected space in which citizens can discuss and decide how they wish to govern themselves, including how to regulate their economy. Ascribing to the First Amendment a particular social or economic policy contradicts this function. The First Amendment vests the People with the power to choose or reject policies, including policies of libertarian economic deregulation.

The Supreme Court that created the commercial speech doctrine — now the key site of dispute in this constitutional conflict — was well aware of this potential contradiction. The Court therefore defined the doctrine to protect the rights of listeners to receive information rather than to safeguard the autonomy of speakers. Some recent court decisions have lost track of this basic distinction, and have used the First Amendment to shield the undisturbed operation of the laissez faire market. Astonishingly, they have even cited Adam Smith to justify their decisions. This approach is inconsistent with the architecture and history of the commercial speech doctrine as well as with the First Amendment’s most basic role in safeguarding democratic governance.

Commercial speech advocates justify their position by arguing that the First Amendment must protect speech in the marketplace because it protects all speech, wherever and however it occurs. But this contention does not survive even the most casual scrutiny. It would lead to the absurd result that constitutional protections extend to those who commit crimes with speech, such as conspiracy or violations of the antitrust laws; to doctors, lawyers, and bankers who commit malpractice or fraud; or to the contracts that make up our commercial transactions. Speech is in fact everywhere. If all speech were to receive the same protections as public discourse, the country would become, literally, ungovernable. Were the First Amendment to extend in such an undifferentiated way, it would simultaneously authorize democratic deliberation and render powerless the government produced by that deliberation.

We argue that the First Amendment can continue to serve as the guardian of our democracy only if it is regarded as plural. Different forms of speech must receive different forms of constitutional protection. Unless this principle is clearly kept it mind, First Amendment decision-making threatens to revive the long-lost world of Lochner and to destroy the very democratic governance the First Amendment is designed to protect.

Download the article from SSRN at the link.

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