GOVERNORS, PRESIDENT SPAR OVER BUSINESS RESUMPTION
April 14, 2020
Dear Friends and Colleagues:
One should be dismayed that so many have forgotten their junior high school history lessons and thus question the president’s authority to reopen the economy, even over the disagreement of the governors of some states.
Those junior high school history lessons taught us about interstate commerce and the reasons for federal jurisdiction over it. Here’s something so simple that maybe even a talking head from CNN might understand it. Let’s say that the State of Michigan wants to restart the auto industry in the Detroit area but that neighboring Ohio, where the tires are made in the Akron area, decides that businesses in Ohio must remain closed and their workers must continue to hibernate. So Detroit can manufacture cars but can’t complete them to make them sale-worthy because they have no tires to put on them. No way!
Parts of nearly everything we purchase from GE or Ford or whomever are made by smaller businesses that specialize in unique subsystems. The hospital ventilators, for example, are made by major manufacturers that require subcontractors in other parts of the country to provide the custom plastic tubing, the rubber wheels that fit into the bottom of the machine, and even the sheet metal that comprises the outer shell is made in steel plants in other states. So that, folks, is why the oversight of interstate commerce is a federal responsibility.
Before this was the case, some states competed with others in applying tariffs – similar to import duties – on goods produced by a neighboring state. But since this is the UNITED States of America, such practice could not be tolerated, or there would be no federal union.
States should be and will be consulted about “reopening,” and no one size fits all. The effects of the pandemic are uneven. And the administration is approaching the reopening cautiously and empaneling committees of industry and science and consulting the states to determine the best mix of where and when and how. But in the end, the president does have the authority to oversee the interstate commerce that will be vital to restarting the economy and putting folks back to work.
Old Frank