Legislation is proper under the Commerce Clause if, aggregating all the effects of the legislation, the regulation has a substantial effect on interstate commerce. (Wickard v. Fullburn; Heart of Atlanta Motel)
Developed (added) rule in Gonzales v. Raich:
- It is irrelevant if the regulated activity is (1) purely local, or (2) not regarded as commerce.
- If failure to regulate the activity would undercut the regulation of the interstate market in the commodity, the congress can do so
It is established in Lopez and Morrison. The Congress can regulate:
- Channels of interstate commerce
- Instrumentalities of interstate commerce, or persons or things of interstate commerce
- actvitivies that substantially affect the interstate commerce
Test for finding “Substantial effect” to the interstate commerce:
(1) Economic activity: is there a direct link between the activity and the interstate commerce? The connection to economic activity cannot be too attenuated (Lopez)
(2) Jurisdictional element: is there a jurisdictional limitation (judicial hook) limiting the (challenged congress regulation) from reaching to activities in interstate commerce
(3) Congressional findings: whether the congress has findings of a substantial effect to the interstate commerce (however, in Morrison, the congressional findings in supporting its regulation has been limited — the final call should be subject to the Court)
(4) Provnice of the states: whether the statute affects areas traditionally left to the states.
The Economic Inactivity Rule
Per NFIB v. Sebelius, Congress can not regulate economic inactivity.
Ginsberg (in her dissent) argued that there are substantial effect from the mandatory insurance to the interstate commerce (they are not annuated). Ginsberg also argued that even the economic inactivity rule applies, there Congress is not regulating inactivity in this case, as everyone will eventually participate in the health care market.