3 - Protection of Economic Liberties

Summary

The Constitution was essentially an economic document based upon the concept that the fundamental private rights of property are anterior to government and morally beyond the reach of popular majorities.

– Charles A. Beard

[A] constitution is not intended to embody a particular economic theory.…It is made for people of fundamentally differing views.

– Justice Oliver Wendell Holmes Jr.

WHEN THE HISTORIAN CHARLES BEARD WROTE IN 1913 that “[t]he Constitution was essentially an economic document,” he claimed too much. The founders intended the Constitution to protect many values, not just property. Nevertheless, property and contract rights ranked high among those that the Constitution was initially designed to safeguard. Prominent framers and ratifiers worried particularly about legislation excusing debtors from obligations to their creditors. They viewed such legislation as immoral because it violated the sanctity of promises and as imprudent because it discouraged commercial lending. (If the legislature could excuse promises to repay money, banks would be less willing to loan money in the first place.) In one of the rare provisions of the original Constitution that creates rights enforceable against the states (rather than the federal government), Article I, Section 10, provides that “[n]o State shall…pass any…Law impairing the Obligation of Contracts.” The Fifth Amendment forbids the federal government from taking “private property…for public use, without just compensation.” The Fourteenth Amendment, which was added to the Constitution in 1868, forbids state and local governments, as much as the national government, to deprive anyone of property without due process of law.