NLRB v. Jones & Laughlin Steel

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In this case, the Supreme Court abandoned the restrictive "stream of commerce" doctrine, which had previously been used by the Court to limit Congress's power under the commerce clause. In its place, the Supreme Court adopted a broader view of Congress's power under the commerce clause, and began the development of what is now commonly referred to as the "substantial effects" doctrine. Under this doctrine, any activity, regardless of whether the activity is wholly intrastate, that has a substantial effect on interstate commerce may be regulated by Congress. In previous years, the Supreme Court had struck down work and safety regulations, child labor laws, and much of FDR's New deal legislation, including the National Recovery Act and the Agricultural Adjustment Act. However, in this case the Court for the first time upheld an important part of FDR's New deal, the National Labor Relation's Act because the Court concluded that Congress had acted within its power to regulate interstate commerce.

This decision, made under pressure from FDR's court packing plan (sometimes called the "switch in time that saved nine"), marked the end of the "Lochner Court" so named after the Lochner case which was the first in a long line of Supreme Court decisions that had invalidated progressive legislation on constitutional and federalism grounds. The commerce clause was then interpreted to give Congress almost unlimited power to regulated in almost any subject matter until the Rehnquist Court limited that authority. For example, most civil rights legislation regulating private conduct was enacted on the strength of the commerce clause powers of Congress.

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