By Richard A. Epstein
Richard A. Epstein strains the previous Court's therapy of federalism and monetary liberty and indicates how early 20th-century progressives prevailed ultimately in undermining these ideas, supplanting aggressive markets with government-created cartels and monopolies
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Individual control over one’s labor and property should be governed, therefore, by the principle that competition and aggression are polar opposites. Competition enhances social welfare. Aggression diminishes it. This emphasis on freedom of choice and freedom of contract shows the close parallels between libertarian and classical liberal thought. But one must also attend to the differences, while noting that the Constitution is unambiguously in the classical liberal camp. The pure libertarian ﬁnds it difficult, perhaps impossible, to accept any forced exchanges initiated by the state for the common good.
In time, this view led to the adoption of the dormant commerce clause jurisprudence whose explicit, built-in procompetitive bias lasts to the present day. It quickly became established that—even when Congress chose not to act—the states could not enter areas that were reserved to the federal government, except with respect to local affairs. In Brown v. ’’46 The creation of a national market free from state impediments seems an inexorable implication of a fundamental truth. Yet once again the free-trade motif counts as only one of two themes.
But state-created monopolies and cartels are worse because they are not subject to erosion by new entry by outsiders and cheating by cartel members. Thus, the classical liberal allows greater scope for government action than the hard-line libertarian. As a result, the classical liberal escapes the vulnerabilities of the libertarian line by accepting that private action (excluding only force or fraud) may lead to destructive results. But that said, the classical liberal joins the libertarian in a full-throated condemnation of state 18 The Classical Liberal Synthesis power used to create or perpetuate economic monopolies and private cartels in what would otherwise be competitive industries.