View Full Version : U.S. Historians--What was the constitutional basis of Nixon's wage-price freeze?
Spectre of Pithecanthropus
04-25-2001, 09:56 AM
I was 13 years old in 1971, when Nixon decreed the wage price freeze in an effort to stop inflation by fiat. Having just been a kid I don't remember what the constitutional basis for that action was. Since when can the President order price or wage restrictions in any sphere except that of Executive Branch operations? Since when would a conservative Republican presume to dictate to private firms whether or not they could grant raises to their employees?
Can you imagine a CEO of those months telling his staff, "We were going to give merit raises this year, but the Prez has forbidden it?"
04-25-2001, 12:56 PM
Title II of the Defense Production Act Amendments of 1970, 84 Stat. 799, as amended, provided temporary authority for wage and price controls, a power which the President subsequently exercised. E.O. 11615, 36 Fed Reg. 15727 (August 16, 1971). Subsequent legislation expanded the President's authority. 85 Stat. 743, 12 U.S.C. Sec. 1904 note. http://supreme.paxtv.findlaw.com/constitution/article01/41.html I believe the authorization lapsed in 1974 and was not renewed by Congress.
Court distinguished Fry v. U.S., which upheld Nixon's wage and price controls, on the grounds that there was an emergency, the action benefited the states, was well tailored, and it didn't force the states to do anything, but only made them not change what they were doing. This is an important point of view: self-promotion is more of a basic liberty than freedom to start an advertising business. http://law.upenn.edu/~jpyle/notes/conout/
Fry v. United States 421 US 542 (1975) (http://caselaw.lp.findlaw.com/scripts/getcase.pl?navby=case&court=us&vol=421&invol=542)
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