Today in 1952: SCOTUS invalidates President Truman’s seizure of steel mills

June 2, 2016

Today in Legal HistoryAs those familiar with early 20th century constitutional jurisprudence may be aware, the Supreme Court had often carved out exceptions to constitutional rights in situations where national security was at risk.  The most prominent of such cases is, of course, 1944’s Korematsu v. U.S., in which the Court upheld the U.S.’s Japanese internment policies.  1919’s Schenck v. U.S. may also come to mind, in which the Court essentially suspended one man’s freedom of speech rights under the First Amendment during World War I.

However, contrast those two rulings with Youngstown Sheet & Tube Co. v. Sawyer. This landmark case, which is marking its 64th anniversary today, invalidated President Truman’s actions in seizing most of the country’s steel mills.

Youngstown was decided on June 2, 1952, in the middle of the Korean War.  The facts of the case are rooted in that conflict: The outbreak of the conflict in 1950 caused a surge in the demand for steel.  While profits for steel companies also saw a commensurate increase, the wages of steel workers did not.  In November 1951, United Steel Workers called for a 35 cent per hour increase in the workers’ wages.  When negotiations failed,  the union leaders stated that a strike would begin on December 31.

President Harry Truman’s advisors were alarmed at this prospect, informing the president that such a occurrence would be a serious threat to national security.  On December 22, 1951, Truman referred the matter to the Wage Stabilization Board for resolution, and convinced the union to postpone a strike until April 8, 1952.  The board had a number of hearings between January and March of 1952, when on March 20, it proposed a 26 cent per hour wage increase for the workers.  The workers were amenable to this proposal, but the companies were not – unless, of course, they were permitted by the government, which had instituted price controls for steel, to charge an additional $12 per ton of steel.  The government refused, and further negotiations failed once more.

On Tuesday, April 8, 1952, the day of the planned strike, President Truman announced his signing of Executive Order 10340, which directed the Secretary of Commerce to seize nearly 90 of the nation’s steel mills, which would continue operating as normal except under ownership of the U.S. government.  The union promised to cooperate with the government (under whom they believed the workers would receive a wage increase), and called off the strike.

The steel mill owners, on the other hand, were incensed, likening Truman’s actions to Hitler’s and Mussolini’s.  They complied with the government’s actions under protest, and within the next two weeks, seven steel companies filed suit requesting a preliminary injunction.  The government lost at the trial court on April 29, and the unions immediately declared a strike.  The trial court further denied the government’s request to stay the injunction pending appeal.

The D.C. Circuit Court of Appeals, on the other hand, granted a 48-hour stay (which also specifically barred the government from increasing worker wages), and the union called off the strike on May 1.

The Supreme Court then granted certiorari, with oral arguments set for May 12, also extending the stay of the court of appeals.

Oral arguments were not kind for the government.  The solicitor general was bombarded with questions from the justices, while the attorney for the steel companies was only asked one.

Nonetheless, Truman would have never believed that the Court would side against him on the case.  Many of the justices were personal acquaintances or political allies – or both.  What’s more, the Court at the time had been very deferential to the executive on most matters, especially those concerning national security.

By a vote of 6-to-3, however, the Court did rule against Truman, not only upholding the injunction but going even further than most observers believed the Court would by declaring the executive action to be unconstitutional.

The majority disjointed, though, with four justices writing separate concurrences.  Although there is no clear theory to be relied on as precedent, most legal scholars rely on Justice Robert H. Jackson’s concurrence, which explained the limits of executive authority thusly:

  1. “When the President acts pursuant to an express or implied authorization of Congress, his authority is at its maximum.”
  2. “When the President acts in absence of either a congressional grant or denial of authority, he can only rely upon his own independent powers, but there is a zone of twilight in which he and Congress may have concurrent authority, or in which its distribution is uncertain.”
  3. “When the President takes measures incompatible with the expressed or implied will of Congress, his power is at its lowest ebb, for then he can rely only upon his own constitutional powers minus any constitutional powers of Congress over the matter.”

As expected, Truman was stunned by the decision.  Regardless, he ordered the mills to be returned to their owners almost immediately after the ruling was announced.  And the union announced its strike shortly thereafter, which lasted 50 days and was only ended when Truman threatened to seize the mills once more, this time under another legal theory that may have had more credible legal grounding.

Although the ultimate outcome of the case wouldn’t really surprise anyone today, Truman had every reason to be shocked, since it truly marked a turning point for the Court in its jurisprudence on executive powers.

Apparently, the temporary seizure of steel mills to keep production going during an armed conflict was just going too far, whereas forcibly relocating 110,000 Japanese-Americans and stripping them of all property wasn’t nearly as reprehensible to the Court.