This past Friday, Judge Janice Rogers Brown of the D.C. Circuit Court of Appeals voted to uphold a blatantly protectionist law designed to prevent competition in the dairy industry. As a matter of judicial doctrine, the case is unremarkable — such laws are upheld all the time. And that — as Judge Brown explained — is the problem.
The case concerned a 2005 federal law designed to prevent dairies that both produce and process milk from having a competitive advantage over dairies that only produce milk. More precisely, the law was written to hamstring a specific Arizona dairy business whose competition had led to a 20-cent drop in the regional price of milk.
The three-judge panel unanimously upheld the law. But Judge Brown, in a scathing concurrence joined by Chief Judge David Sentelle, made clear that she wasn’t happy about it. Her vote, she explained, was compelled by decades of bad U.S. Supreme Court precedent.
Since the 1930s, the Supreme Court has ordered lower courts to review economic regulations with an extremely deferential “rational basis test,” which requires only that such regulations be “rationally related” to a “legitimate government interest.” In practice, this amounts to no meaningful review at all.
With that kind of precedent, it is no surprise the D.C. Circuit upheld a law primarily designed to subsidize milk producers by forcing consumers to pay artificially inflated prices for milk. As Judge Brown aptly put it, the Supreme Court has “abdicated its constitutional duty to protect economic rights.”