William_T._Bianco,_David_T._Canon]_American_Polit

The evolving concept of federalism 81

clause powers. In a series of cases in the late nineteenth and early twentieth

centuries, the Supreme Court endorsed a view of laissez-faire—French for “leave

alone”—capitalism aimed at protecting business from regulation by the national

government. To this end, the Court defined clear boundaries between interstate

and intrastate commerce, ruling that Congress could not regulate any economic

activity that occurred within a state (intrastate). The Supreme Court let some

national legislation that was connected to interstate commerce stand, such as

the Sherman Antitrust Act (1890), which placed limits on monopolies. However,

when the national government tried to use this act to break up a cartel of four sugar

companies that controlled 98 percent of the nation’s sugar production, the Court

ruled that Congress did not have this power. The Court’s decision argued that the

commerce clause allowed Congress to regulate the transportation of goods, not

their manufacture, and the sugar in question was made within a single state. Even if

the sugar was sold throughout the country, this was “incidental” to its manufacture.^5

On the same grounds, the Court struck down attempts by Congress to regulate

child labor.^6

Cooperative Federalism

From the early years of the twentieth century through the 1930s, a new era of

American federalism emerged in which the national government became much

more involved in activities that were formerly reserved for the states, such as

transportation, civil rights, agriculture, social welfare, and management–labor

relations. At first, the Supreme Court resisted this broader reach of national power,

clinging to its nineteenth-century conception of dual federalism.^7 But as commerce

became more national, the distinctions between interstate and intrastate commerce,

and between manufacture and transportation, became increasingly difficult to

sustain. Starting in 1937 with the landmark ruling National Labor Relations Board

After the Supreme Court struck down

the 1875 Civil Rights Act, southern

states were free to impose Jim Crow

laws. These state and local laws led to

complete racial segregation, even for

public drinking fountains.

Full_04_APT_64431_ch03_070-101.indd 81 16/11/18 1:29 PM