The "New Protectionism" and the American common market

Notre Dame Law Review

Volumn 85, Issue 1, 2009, Pages 247-312

  Williams, Norman R ^a,b,c   Denning, Brannon P ^a,d  

^a Department of Law ^*

^b WILLAMETTE UNIVERSITY   (United States)

^c HARVARD UNIVERSITY   (United States)

^d SAMFORD UNIVERSITY   (United States)

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[No Author keywords available]

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EID: 76949099175     PISSN: 07453515     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (421)

1. See Pike v. Bruce Church, Inc., 397 U. S. 137 (1970).
2. See Norman R. Williams, The Commerce Clause and the Myth of Dual Federalism, 54 UCLA L. Rev. 1847, 1929-30 (2007).
3. See Welton v. Missouri, 91 U. S. 275, 281 (1876) (invalidating discriminatory state law and decrying the "evils of discriminating State legislation, favorable to the interests of one State and injurious to the interests of other states") ;
4. see also Gibbons v. Ogden, 22 U. S. (9 Wheat.) 1, 224 (1824) (Johnson, J., concurring) (declaring that such "iniquitous laws and impolitic measures" were "destructive to the harmony of the States" and were therefore unconstitutional).
5. See Brannon P. Denning, Reconstructing the Dormant Commerce Clause Doctrine, 50 WM. & MARY L. REV. 417, 428-48 (discussing doctrinal evolution of the dormant Commerce Clause) ;
6. see also Williams, supra note 2, at 1865-66 & nn. 74, 80 (citing cases pertaining to "state" discriminatory measures).
7. Donald H. Regan, The Supreme Court and State Protectionism: Making Sense of the Dormant Commerce Clause, 84 MICH. L. REV. 1091, 1206-20 (1986).
8. 550 U. S. 330 (2007).
9. 128 S. Ct. 1801 (2008).
10. For convenience sake, we refer to all bonds issued either by state or local governments, or their political subdivisions, as municipal bonds. For additional commentary on United Haulers and Davis, see Dan T. Coenen, Where United Haulers Might Take Us: The Future of the State-Self-Promotion Exception to the Dormant Commerce Clause Rule, 95 IOWA L. REV. (forthcoming 2009) [hereinafter Coenen, United Haulers], available at http://works.bepress.com/dan-coenen/22;
11. Walter Hellerstein & Eugene W. Harper, Jr., Discriminatory State Taxation of "Private Activity Bond" Income After Davis, 123 TAX NOTES 447 (2009) ;
12. Daniel R. Ray, Cosh, Trash, and Tradition: A New Dormant Commerce Clause Exception Emerges from United Haulers and Davis, 61 TAX LAW. 1021 (2008) ;
13. Dan T. Coenen, The Supreme Court's Municipal Bond Decision and the Market-Participant Exception to the Dormant Commerce Clause (2009) (unpublished manuscript), available at http://works.bepress.com/dan-coenen/21/ [hereinafter Coenen, The Supreme Court's Municipal Bond Decision];
14. Edward A. Zelinsky, The False Modesty of Department of Revenue v. Davis: Disrupting the Dormant Commerce Clause Through the Traditional Public Function Doctrine (Benjamin N. Cardozo Sch. of Law Jacob Burns Inst. for Advanced Legal Studies, Working Paper No. 255, Mar. 2009), available at http://ssrn. com/abstract=l 352687. 9 See Davis, 128 S. Ct. at 1815.
15. See id. at 1815-17.
16. Discriminatory measures ar". 'virtually per se'" invalid, Maine v. Taylor, 477 U. S. 131, 148 (1986)
17. (quoting City of Phila. v. New Jersey, 437 U. S. 617, 624 (1978)), and can be upheld only when the state demonstrates that the la". 'serves a legitimate local purpose' and that this purpose could not be served as well by available nondiscriminatory means."
18. Id. at 138
19. (quoting Hughes v. Oklahoma, 441 U. S. 322, 336 (1979)).
20. See Davis, 128 S. Ct. at 1811-14.
21. In United Haulers, the Court subjected the county flow-control ordinances to the so-called "Pike balancing test" from Pike v. Bruce Church, Inc., 397 U. S. 137 (1970). Interestingly, however, in Davis, the Court refused to apply Pike because, as the Court explained, the benefits and costs of Kentucky's municipal bond taxation scheme could not be measured and evaluated by courts in a principled or coherent fashion.
22. See Davis, 128 S. Ct. 1817-19.
23. See Davis, 128 S. Ct. at 1810.
24. Pike, 397 U. S. at 145-46.
25. For cases that provide an example of "cooperation", see BORIS I. BITTKER & BRANNON P. DENNING, BITTKER ON THE REGULATION OF INTERSTATE AND FOREIGN COMMERCE 187 n. 181.2 (2009 Cum. Supp.).
26. See, e.g., Chem. Waste Mgmt., Inc. v. Hunt, 504 U. S. 334, 346-49 (1992) (invalidating protectionist measure adopted for environmental, not economic, reasons).
27. Cf. David Stevenson, The Return of Protectionism, MONEVWEEK, Jan. 16, 2009, http://www.moneyweek.com/news- and
28. See James R. Ramsey & Merl Hackbart, State and Local Debt Policy and Management, in HANDBOOK OF DEBT MANAGEMENT 255, 261 (Gerald J. Miller ed., 1996).
29. 26 U. S. C. § 103 (2006).
30. See id. § 141.
31. See H. R. 425, 111th Cong. (2009) ;
32. H. R. 537, 111th Cong. (2009) ;
33. see also Peter Schroeder & Audrey Dutton, House Eyes Muni, Tax Cut Bills, BOND BUYER, Jan. 16, 2009, at 19 (discussing the muni provisions in the stimulus package).
34. The summaries of United Haulers and Davis draw freely on Bittker & Denning, supra note 16.
35. See Maine v. Taylor, 477 U. S. 131, 138 (1986).
36. See id.
37. Pike v. Bruce Church, Inc., 397 U. S. 137, 142 (1970).
38. See, e.g., Prudential Ins. Co. v. Benjamin, 328 U. S. 408, 427-40 (1946) (upholding both the McCarran-Ferguson Act's delegation to states of power to regulate the insurance business and a discriminatory state law passed in its wake).
39. But see Norman R. Williams, Why Congress Cannot "Overrule" the Dormant Commerce Clause, 53 UCLA L. REV. 153 (2005) (criticizing this exception).
40. See generally Dan T. Coenen, Untangling the Market-Participant Exemption to the Dormant Commerce Clause, 88 MICH. L. REV. 395, 396-405 (1989) (describing the development of the market-participant doctrine).
41. New Energy Co. v. Limbach, 486 U. S. 269, 277 (1988).
42. See generally Coenen, supra note 28, at 409 (providing a history and critique of the market-participant doctrine) ;
43. Norman R. Williams, Taking Care of Ourselves: State Citizenship, the Market, and the State, 69 OHIO ST. L. J. 469, 493-99 (2008) (offering a framework to reconcile competing demands of interstate equality and state autonomy). Though the Court has never explicitly so held, it is generally assumed that states may subsidize in-state businesses in a discriminatory manner. See Dan T. Coenen, Business Subsidies and the Dormant Commerce Clause, 107 YALE L. J. 965, 978 (1998). For more on the market-participant doctrine and Davis, see discussion infra Part IV.
44. 511 U. S. 383 (1994).
45. See id. at 392-95.
46. See id.
47. Id. at 387.
48. See id. at 410-11 (Souter, J., dissenting).
49. See, e.g., Stanley E. Cox, Garbage In, Garbage Out: Court Confusion About the Dormant Commerce Clause, 50 OKLA. L. REV. 155, 185-89 (1997) ;
50. Christine A. Klein, The Environmental Commerce Clause, 27 HARV. ENVTL. L. REV. 1, 47-52 (2003) ;
51. Bradford C. Mank, Are Public Facilities Different from Private Ones?: Adopting a New Standard of Review for the Dormant Commerce Clause, 60 SMU L. REV. 157, 176-78 (2007) ;
52. Paula C. Murray & David B. Spence, Fair Weather Federalism and America's Waste Disposal Crisis, 27 HARV. ENVTL. L. REV. 71, 72, 89-91 (2003).
53. For citations to cases decided after Carbone, see BITTKER & DENNING, supra note 16, at 187 n. 181.2.
54. Compare United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 438 F.3d 150, 161-63 (2d Cir. 2006) (upholding ordinance requiring disposal at municipal authority-owned waste disposal site)
55. with Nat'l Solid Wastes Mgmt. Ass'n v. Daviess County, 434 F.3d 898, 910-12 (6th Cir. 2006) (holding that similar ordinance violated the dormant Commerce Clause).
56. See, e.g., BITTKER & DENNING, supra note 16, at 222-25 (citing cases).
57. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 334-36 (2007).
58. Id. at 335-36.
59. Id. at 335.
60. Id. The evidence was that "without the flow control laws and the associated $86-per-ton tipping fees, they could dispose of solid waste at out-of-state facilities for between $37 and $55 per ton, including transportation". Id. at 337.
61. Id. at 334.
62. See id. at 339-42.
63. See id. at 339-40.
64. See id.; see also id. at 359 (Alito, J., dissenting) (raising this argument).
65. Id. at 340 (majority opinion).
66. Id.
67. Id. at 342.
68. Id. at 343
69. (quoting Wyoming v. Oklahoma, 502 U. S. 437, 454 (1992)).
70. See id.
71. Id.
72. Id. at 344.
73. Id. at 345. Political safeguards, the Chief Justice asserted, would prevent "state control of the economy."
74. Id. at 345 n. 7. In any event, the Chief Justice continued, Congress could step in if a state or municipality abused the exception created here. See id.
75. See id. at 346-47. Justice Scalia concurred (except for the portion of the majority's opinion engaging in Pike balancing).
76. Id. at 348-49 (Scalia, J., concurring). For his part, Justice Thomas concurred, repeating his new position that he will not enforce the dormant Commerce Clause in any cases. He expressly repudiated his vote with the Carbone majority and claimed that the antidiscrimination principle finds no expression in the Commerce Clause. Id. at 349-55 (Thomas, J., concurring).
77. See id. at 356 (Alito, J., dissenting).
78. Id. at 358-59.
79. Id.
80. See supra notes 50-55 and accompanying text.
81. United Haulers, 550 U. S. at 364 (Alito, J., dissenting) (footnote omitted).
82. Id. at 365.
83. Id. at 369. He also pointed out that even if waste disposal was a traditional governmental function, it no longer is. Id.
84. Id. at 370 (citation omitted).
85. Id. at 371 n. 4.
86. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1804-05 (2008) ;
87. Davis v. Dep't of Revenue, 197 S. W.3d 557, 560 (Ky. Ct. App. 2006).
88. See Davis, 197 S. W.3d at 561-65.
89. See Davis, 128 S. Ct. at 1801.
90. See id. at 1807-08.
91. See id. at 1809-10.
92. Id. at 1810.
93. Id. at 1810-11.
94. See id.
95. Id. at 1811 (footnotes omitted).
96. Id.
97. Id. at 1810-11.
98. Id. at 1811.
99. Id. at 1815.
100. Id. at 1815-16.
101. See id. at 1816.
102. Id. at 1817.
103. Id. at 1819.
104. See id. at 1811-14 (plurality opinion). Only Justices Breyer and Stevens joined Justice Souter in this portion of the opinion.
105. z.ast;; id. at 1821 (Roberts, C. J., concurring in part).
106. Id. at 1812 (plurality opinion).
107. Id. For more on this portion of the opinion, see infra Part IV.
108. See id. at 1817-19 (majority opinion). Justice Souter initially questioned whether, when the Court has concluded that an exception to the antidiscrimination principle applies, plaintiffs are entitled to a Pike analysis. See id. at 1819-20.
109. See id. at 1818.
110. See id. We discuss the implications of this grudging approach infra Part V. B.
111. As he has traditionally, Justice Scalia refused to join in the portion of the opinion discussing Pike balancing. See id. at 1821 (Scalia, J., concurring in part).
112. Justice Stevens, who joined both in United Haulers, joined the majority. See id. at 1819 (Stevens, J., concurring).
113. See id. at 1822-23 (Kennedy, J., dissenting).
114. Id. at 1824.
115. See id. at 1824-27.
116. See id. at 1827.
117. Id.
118. Id. at 1828.
119. Id. at 1829.
120. Id. at 1830.
121. That the Court would use United Haulers as the vehicle to launch such a dramatic change in dormant Commerce Clause doctrine was somewhat surprising. The Court's preexisting doctrine provided a sufficient basis for resolving the case as it did. See Norman R. Williams, The Foundations of the American Common Market, 84 NOTRE DAME L. REV. 409, 465-67 (2008). The county waste flow-control ordinances did not explicidy distinguish along state lines, and, because the entities most directly burdened by the measures were private waste processors, most (if not all) of which were in-state companies, it was almost certain that the municipal ordinances were not discriminatory in effect. As a consequence, the Court could have reached the same result by applying traditional dormant Commerce Clause doctrine. See id.
122. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 342-45 (2007) ;
123. discussion supra Part LB.
124. See also Zelinsky, supra note 8 (manuscript at 5) ("Davis has broad and disruptive implications by affirming the centrality of the traditional public function doctrine for dormant Commerce Clause purposes.").
125. Davis, 128 S. Ct. at 1810.
126. Id.
127. (quoting United Haulers, 550 U. S. at 344).
128. Id at 1811.
129. Id.
130. Id.
131. (quoting United Haulers, 550 U. S. at 342).
132. See id.
133. 104 U. S. 592 (1882).
134. Davis, 128 S. Ct. at 1811.
135. Id.
136. See id. at 1815.
137. Id.
138. See Brief for the State of North Carolina et al. as Amici Curiae in Support of Petitioners at 1-4, Davis, 128 S. Ct. 1801 (No. 06-666), 2007 WL 2115445.
139. Davis, 128 S. Ct. at 1815-16.
140. Id. at 1816.
141. See id. (noting that "many single-state funds would disappear if the current differential tax schemes were upset").
142. See id. at 1816-17.
143. Id. at 1816.
144. See id. at 1819 n. 21 ("[P]ractical consequences have always been relevant in deciding the constitutionality of local tax laws.").
145. See id. at 1817.
146. Id.
147. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 343 (2007) ;
148. see also Davis, 128 S. Ct at 1810 (noting that "likely motivation" for governmental favoritism is a "legitimate objective [] distinct from the simple economic protectionism the Clause abhors").
149. See United Haulers, 550 U. S. at 364 (Alito, J., dissenting).
150. To be sure, protectionism inevitably imposes some burden on in-state interests, such as, in Davis, resident taxpayers who own out-of-state municipal bonds. Such instate burdens, however, do not often translate into substantial in-state political opposition because of collective action problems and because the state often finds other ways to mollify in-state opponents. See Williams, supra note 99, at 437-44.
151. United Haulers, 550 U. S. at 366 (Alito, J., dissenting).
152. 437 U. S. 617 (1978).
153. See id. at 625.
154. See id. at 627.
155. See id. at 629.
156. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1816 (2008).
157. See id. at 1810-11;
158. see also id. at 1820-21 (Scalia, J., concurring in part) (discussing the state's alternatives).
159. Cf. Lochner v. New York, 198 U. S. 45, 58-60 (1905) (striking down a restriction on bakers' hours because of disagreement with New York's assessment of the health threat posed by bakery working conditions).
160. 426 U. S. 833, 851 (1976) (holding that Congress's commerce power did not authorize Congress to regulate the "integral governmental functions" of state and local governments).
161. 469 U. S. 528 (1985).
162. See id. at 546.
163. Id. at 539.
164. See id. at 545-46;
165. Zelinsky, supra note 8 (manuscript at 5) ("[T]he 'traditional public function' category, which has become central to the Roberts Court's dormant Commerce Clause analysis, lacks persuasive boundaries and undermines prior case law.").
166. Cf. United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 369 (2007) (Alito., J., dissenting) (noting similarity to Usery).
167. Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1810 n. 9 (2008) (citations omitted).
168. See id. at 1810 ("[T]he issuance of debt securities to pay for public projects is a quintessentially public function....") ;
169. United Haulers, 550 U. S. at 344 ("'[W]aste disposal is both typically and traditionally a local government function. '"
170. (quoting United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 261 F.3d 245, 264 (2d Cir. 2001))).
171. But see Zelinsky, supra note 8 (manuscript at 26) ("[I]t is arbitrary to decide when a particular public practice is old enough to be deemed 'traditional.' Tradition is very much in the eye of the beholder. It is, moreover, equally arbitrary to deem certain governmental activities as 'public' and others as not") ;
172. id. (manuscript at 39) (arguing that the distinction between public and nonpublic functions is so broad as to be "indeterminate").
173. See United Haulers, 550 U. S. at 345.
174. See id.
175. See W. Lynn Creamery, Inc. v. Healy, 512 U. S. 186, 193, 203 (1994).
176. Compare Julian N. Eule, Laying the Dormant Commerce Clause to Rest, 91 YALE L. J. 425, 460-61 (1982) (arguing that judicial review is necessary only when out-of-state interests are disproportionately affected by a measure)
177. with James M. O'Fallon, The Commerce Clause: A Theoretical Comment, 61 OR. L. REV. 395, 413 (1982) ("The presence of adversely affected constituents, even in significant numbers, by no means assures that the balance of interests represented accurately reflects the balance of interests in the nation as a whole.").
178. See Davis, 128 S. Ct. at 1811.
179. See United Haulers, 550 U. S. at 342-43 (noting that the responsibilities of "health, safety, and welfare" for citizens "set state and local government apart from a typical private business").
180. This is implicit in the Court's repeated statements that governmental favoritism is unlikely to be protectionist and the Court's condemnation only of, as it tellingly put it, "private protectionism." See Davis, 128 S. Ct. at 1817.
181. 519 U. S. 278 (1997).
182. See id. at 298-310.
183. Id. at 287-88. GM characterized such discrimination as "facial" or "patent", but the Court's treatment of the case demonstrates that it viewed the relevant discrimination as one "in effect."
184. See id. at 287, 307 n. 15.
185. See id. at 298-99.
186. See id.
187. Id. at 300.
188. Id. at 299.
189. See id. at 307 n. 15.
190. See id.
191. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1816-17 (2008).
192. See id. at 1811;
193. United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 342-43 (2007).
194. As the Court noted in City of Philadelphia, protectionism can manifest itself in the legislative means employed by the state. See City of Phila. v. New Jersey, 437 U. S. 617, 627 (1978).
195. New Energy Co. v. Limbach, 486 U. S. 269, 273-74 (1988) ;
196. see also Davis, 128 S. Ct. at 1808 (identifying the concern addressed by the modern dormant Commerce Clause as regulatory measures designed to benefit in-state interests by burdening outof-state competitors).
197. See, e.g., Davis, 128 S. Ct. at 1811. Besides Kentucky, which is a party to the case, the other forty-nine states signed an amicus brief supporting the consdtutionality of such discriminatory municipal bond taxation. See id.
198. See id. at 1815-16.
199. As the Court noted, forty-one states tax the interest earned on out-of-state municipal bonds while exempting the interest on some or all in-state municipal bonds. Id. at 1806-07 & n. 7. Seven states do not have a state income tax.
200. See id. Only Indiana exempts from its state income tax the interest earned on all municipal bonds regardless of source.
201. See id. at 1807 n. 7;
202. see also IND. CODE § 6-3-1-3.5 (2007 & Supp. 2009) (providing this exemption).
203. See Davis, 128 S. Ct. at 1829 (Kennedy, J., dissenting).
204. Indeed, as the Court itself noted and emphasized, an endre industry dependent upon this system of protectionism has emerged. Id. at 1816 (majority opinion) ;
205. see also id. at 1822-23 (Kennedy, J., dissenting) (describing how such protectionism has "distorted" state and municipal bond markets). It is hardly surprising that this industry now warns both the states and the Court of the disaster that would allegedly befall the nation were municipal bonds treated the same way as and subject to the same constitutional rules as milk (West Lynn Creamery v. Healy) or solid waste (City of Philadelphia v. New Jersey). See, e.g., Amicus Curiae Brief of the Securides Industry and Financial Markets Associadon in Support of Petitioners at 5, Davis, 128 S. Ct. 1801 (No. 06-666), 2007 WL 2115447 ("If the municipal bond tax incentive evaporates, the demand for such bonds may likewise vanish, thus drying up a major source of funding for State projects.").
206. See Davis, 128 S. Ct. at 1828-29 (Kennedy, J., dissendng).
207. See id. at 1815-17 (majority opinion).
208. See id. at 1830 (Kennedy, J., dissendng).
209. See id. at 1815 (majority opinion). The Court dismisses the relevance of this conclusion on the ground that all forty-nine states have consented to such discrimination.
210. See id. For the reasons discussed above, however, that response is entirely inapposite. See supra text accompanying notes 160-65.
211. See Davis, 128 S. Ct. at 1815.
212. Id. at 1816.
213. Id.
214. 486 U. S. 269 (1988).
215. Id. at 274.
216. Davis, 128 S. Ct. at 1816.
217. Kentucky seeks to discourage Kentucky residents from buying out-of-state municipal bonds so as to encourage them to buy the bonds offered by in-state local governments. Yet small Kentucky cities are only better off if Kentucky's protectionist tax scheme produces more native investment in its cities' bonds than they would obtain from nonresidents if the latter were able to purchase Kentucky bonds on a nondiscriminatory basis. For small states with relatively small amounts of private capital held by residents available for such domestic investment, the superiority of the current system versus that of a national common market in public financing (where Kentucky municipalities would be on equal footing with all other municipalities in attracting capital from investors in all the states) is far from certain.
218. One might add that, even if such an exception is desirable, it should be made by Congress pursuant to its authority to authorize discriminatory action pursuant to its commerce power. But see Williams, supra note 27 (criticizing the validity of such congressional power).
219. Baldwin v. G. A. F. Seelig, Inc., 294 U. S. 511, 523 (1935).
220. For a similar discussion of the potential ramifications of this exception, see Coenen, United Haulers, supra note 8 (manuscript at 23-79).
221. See also id. (manuscript at 5) ("[C]ourts must be ever-mindful that United Haulers and Davis reflect a doctrinal amibitiousness that the opinions in those cases tend to understate.").
222. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 345-46 (2007).
223. See id. at 342-47.
224. The value of the preference is greatest in those states with the highest state income taxes.
225. Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1810 (2008).
226. Id. at 1829 (Kennedy, J., dissenting).
227. See Bacchus Imps., Ltd. v. Dias, 468 U. S. 263, 269 (1984).
228. These are not the only examples. State and local governments are engaged in a myriad of activities. South Dakota, for example, used to own and operate a cement factory. See Reeves, Inc. v. Stake, 447 U. S. 429, 446-47 (1980) (upholding state requirement banning out-of-state individuals from purchasing cement from stateowned cement plant). Under Davis, South Dakota could have adopted a regulation requiring all construction projects in the state to use cement from the factory.
229. See, e.g., Pierce v. Soc'y of Sisters, 268 U. S. 510, 534-36 (1925) (holding that state law requiring all elementary school children to attend public schools violated Fourteenth Amendment's Due Process Clause).
230. Cf. United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 345 n. 7 (2007) (noting that Congress may use its commerce power "to limit state use of exclusive franchises").
231. See Duckworth v. Arkansas, 314 U. S. 390, 400 (1941) (Jackson, J., concurring in the result) ;
232. see also infra text accompanying notes 225-26.
233. Davis, 128 S. Ct. at 1810 n. 9.
234. See U. S. CENSUS BUREAU, 2006 STATE AND LOCAL GOVERNMENT EMPLOYEE-RETIREMENT SYSTEMS, at tbl. 5A (2008), available at http://www.census.gov/ govs/retire/2006ret05a.html.
235. See id. at tbl. 4a (3), available at http://www.census.gov/ govs/retire/2006ret 04a-3.html.
236. See CalPERs, Investments, FACTS AT A GLANCE (Cal. Public Employees' Retirement System, Sacramento, Cal.), Oct. 2009, at 1, available at http://www.calpers.ca. gov/eip-docs/about/ facts/investme.pdf.
237. See, e.g., janna J. Hansen, Limits of Competition: Accountability in Government Contracting, 112 YALE L. J. 2465, 2465 (2003) ("Government contracts with private providers for the supply of goods and services have grown in number and magnitude over the last several decades.").
238. See Williams, supra note 30, at 478-79.
239. Peter D. Enrich, Saving the States from Themselves: Commerce Clause Constraints on State Tax Incentives for Business, 110 HARV. L. REV. 377, 397 (1996).
240. Cf. 28 U. S. C. § 1603 (b) (2) (2006) (defining corporations in which a foreign state owns a majority of shares as instrumentalities of the foreign state).
241. See N. Y. STATE COMMON RET. FUND., ASSET LISTING AS OF MARCH 31, 2007, at 22, available at http://www.osc.state.ny.us/retire/word-and-pdf- documents/publications/catr/asset-listings-07.pdf (last visited Oct. 9, 2009).
242. As of March 28, 2008, Exxon Mobil's total market value was almost $456 billion. See Our Annual Ranking of America's Largest Corporations, FORTUNE, May 5, 2008, available at http://money.cnn. com/magazines/fortune/fortune500/2008/snap shots/387.html.
243. Cf. Dole Food Co. v. Patrickson, 538 U. S. 468, 477 (2003) (holding that, in the context of the Foreign Sovereign Immunities Act, a foreign state's indirect ownership of majority of shares of private corporation through several intermediate subsidiaries does not render corporation an instrumentality of the foreign state).
244. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 345 (2007).
245. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 261 F.3d 245, 250 (2d Cir. 2001).
246. C & A Carbone, Inc. v. Town of Clarkstown, 511 U. S. 383, 394 (1994).
247. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1811 (2008) ;
248. United Haulers, 550 U. S. at 343-44.
249. Cf. New Energy Co. v. Limbach, 486 U. S. 269, 280 (1988) (invalidating tax credit for ethanol manufactured in state).
250. See supra Part II. B.
251. See Brief for the National Federation of Municipal Analysts, as Amicus Curiae in Support of Neither Party at 6, Davis, 128 S. Ct. 1801 (No. 06-666), 2007 WL 2115441.
252. See id. at 6-7.
253. See id. at 7 n. 3.
254. Michael J. Stutzer, The Statewide Economic Impact of Small-Issue Industrial Revenue Bonds, FED. RES. BANK OF MINNEAPOLIS Q. REV., Spring 1985, at 2;
255. see also Joel Michael, Kentucky v. Davis: Implications for State Tax Policy and the Dormant Commerce Clause, 45 ST. TAX NOTES 753, 759 (2007) (noting that "with traditional industrial development revenue bonds, the bonds are, in all but name, corporate bonds").
256. Brief of Alan D. Viard et al. as Amici Curiae Supporting Respondents at 25, Davis, 128 S. Ct. 1801 (No. 06-666), 2007 WL 2808465. Prior to the federal Tax Reform Act of 1986, which limited the federal income tax benefit for such private activity bonds, such bonds comprised sixty-eight percent of all municipal bonds. See Michael, supra note 210, at 759 & n. 51.
257. Cf. Rendell-Baker v. Kohn, 457 U. S. 830, 840 (1982) (holding that a private school that received ninety percent of its funding from the state did not constitute a state actor).
258. See Davis, 128 S. Ct. at 1805 n. 2.
259. Id.
260. The proceeds of bonds can be deposited either in a segregated fund that is used for a particular project or in the general fund, which is used to fund legislatively specified appropriations. One suspects that, were the Court to invalidate discriminatory tax treatment for private activity bonds, states and municipalities might try to conceal such bonds by depositing all bond proceeds in the general fund and then providing cash subsidies via appropriation from the general fund to the same private companies. Cf. Cumberland Farms, Inc. v. Tax Assessor, 116 F.3d 943, 944-45 (1st Cir. 1997) (noting that Maine's response to invalidation of a discriminatory milk taxand-rebate scheme was to amend statute to provide that milk tax proceeds were deposited in a general fund, which was then used to fund a subsidy to in-state dairy farmers). Moreover, further complicating matters (and encouraging such formalist responses by state and local governments), such direct cash subsidies are assumed by the Court to raise no dormant Commerce Clause issue.
261. See W. Lynn Creamery, Inc. v. Healy, 512 U. S. 186, 199 & n. 15 (1994) ;
262. Williams, supra note 30, at 478-81.
263. See, e.g., United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 335 (2007) (noting that private companies were used to "pick up citizens' trash").
264. See generally Stutzer, supra note 210, at 400-05 (discussing the use and impact of such bonds).
265. See, e.g., Westinghouse Elec. Corp. v. Tully, 466 U. S. 388, 400-01 (1984) (invalidating tax exemption for companies that expanded in-state operations with regard to foreign exports).
266. W. Lynn Creamery, 512 U. S. at 204-05 & n. 20.
267. 28 U. S. C. § 1602 (2006).
268. See id. § 1603 (b) (2) ;
269. Dole Food Co. v. Patrickson, 538 U. S. 468, 471 (2003).
270. See Regents of the Univ. of Cal. v. Doe, 519 U. S. 425, 429-31 (1997) ;
271. Pastrana-Torres v. Corporacion de P. R. Para la Difusion Publica, 460 F.3d 124, 126-27 (1st Cir. 2006) ;
272. Aguon v. Commonwealth Ports Auth., 316 F.3d 899, 901 (9th Cir. 2003) ("In the Eleventh Amendment context, we employ a five-factor test to determine whether an entity is an arm of the state: (1) 'whether a money judgment would be satisfied out of state funds,' (2) 'whether the entity performs central governmental functions,' (3) 'whether the entity may sue or be sued,' (4) 'whether the entity has the power to take property in its own name or only the name of the state' and (5) 'the corporate status of the entity.'"
273. (quoting Mitchell v. L. A. Cmty. Coll. Dist., 861 F.2d 198, 201 (9th Cir. 1989))).
274. See 28 U. S. C. § 1603 (b) (2).
275. Id.
276. See, e.g., Peninsula Asset Mgmt. (Cayman) Ltd. v. Hankook Tire Co., 476 F.3d 140, 143 (2d Cir. 2007) (noting that test requires analysis of following factors: "' (1) whether the foreign state created the entity for a national purpose; (2) whether the foreign state actively supervises the entity; (3) whether the foreign state requires the hiring of public employees and pays their salaries; (4) whether the entity holds exclusive rights to some right in the [foreign] country; and (5) how the entity is treated under foreign state law'" (alteration in original)
277. (quoting Filler v. Hanvitt Bank, 378 F.3d 213, 217 (2d Cir. 2004))) ;
278. Kelly v. Syria Shell Petroleum Dev. B. V., 213 F.3d 841, 847 (5th Cir. 2000) (noting that, while these factors "provide a helpful framework, we will not apply them mechanically or require that all five support an organdetermination").
279. Compare Pastrana-Torres, 460 F.3d at 128 (holding that Public Broadcast Corporation of Puerto Rico is not arm of commonwealth, despite substantial governmental control)
280. with Villegas Davila v. Pascual, 631 F. Supp. 919, 921-22 (D. P. R. 1986) (holding that corporation was arm of state, despite commonwealth statute expressly providing that corporation was distinct from commonwealth and that debts of corporation were not that of commonwealth).
281. See, e.g., Kelly, 213 F.3d at 847;
282. Joseph W. Dellapenna, Refining the Foreign Sovereign Immunities Act, 9 WILLAMETTE J. INT'L L. & DISP. RES. 57, 65 (2001).
283. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 345 n. 7 (2007).
284. See U. S. CENSUS BUREAU, LOCAL GOVERNMENTS AND PUBLIC SCHOOL SYSTEMS BY TYPE AND STATE: 2007 (2008), available at http://www.census.gov/govs/cog/GovOrg Tab03ss.html.
285. Duckworth v. Arkansas, 314 U. S. 390, 400 (1941) (Jackson, J., concurring in the result).
286. INS v. Chadha, 462 U. S. 919, 957-58 (1983) (requiring that all legislative action satisfy bicameralism and presentment requirements).
287. See Brannon P. Denning, Is the Dormant Commerce Clause Expendable? A Response to Edward Zelinsky, 77 Miss. L. J. 623, 646-50 (2007).
288. See, e.g., infra note 235.
289. See Hillside Dairy Inc. v. Lyons, 539 U. S 59, 66-67 (2003) ;
290. W. Lynn Creamery, Inc. v. Healy, 512 U. S. 186, 204-05 (1994) ;
291. Sporhase v. Nebraska, 458 U. S. 941, 957-58 (1982) ;
292. Hughes v. Alexandria Scrap Corp., 426 U. S. 794, 810-14 (1976).
293. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1821-22 (2008) (Thomas, J., concurring in the judgment) ;
294. H. P. Hood & Sons, Inc. v. DuMond, 336 U. S. 525, 551 n. 2 (1949) (Black, J., dissenting) (noting that he had "acquiesced" in the
295. See, e.g., Davis, 128 S. Ct. at 1810-11;
296. id. at 1821 (Scalia, J., concurring in part) ;
297. id. at 1822 (Thomas, J., concurring in the judgment).
298. See id. at 1813-18 (majority opinion) ;
299. United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 343-47 (2007).
300. See Davis, 128 S. Ct. at 1824 (Kennedy, J., dissenting).
301. See United Haulers, 550 U. S. at 345 n. 7.
302. See Best & Co. v. Maxwell, 311 U. S. 454, 455-56 (1990).
303. See Davis, 128 S. Ct. at 1811-17 (reflecting that Justices Breyer and Stevens joined Justice Souter's market-participant exception and all other Justices disagreed with its reasoning) ;
304. Coenen, The Supreme Court's Municipal Bond Decision, supra note 8 (manuscript at 10) (terming the plurality's recharacterization, in Davis, of United Haulers as a market-participant case "a radically revisionist treatment of the decision").
305. See Hughes v. Alexandria Scrap Corp., 426 U. S. 794, 810-14 (1976) (upholding state program to encourage recycling of abandoned automobiles, where paperwork requirements on out-of-state scrap processors were more onerous than those imposed on in-state competitors) ;
306. see also White v. Mass. Council of Constr. Employers, 460 U. S. 204, 214-15 (1983) (upholding executive order requiring city residents to compose one-half of work force on all city-funded or-administered construction projects). For scholarly commentary on the exception
307. see BORIS I. BITTKER, BITTKER ON THE REGULATION OF INTERSTATE AND FOREIGN COMMERCE §§ 7.01-7.07 (Brannon P. Denning ed., 1999 & 2008 Supp.) ;
308. Coenen, supra note 28;
309. Williams, supra note 30.
310. See Reeves, Inc. v. Stake, 447 U. S. 429, 446-47 (1980).
311. The market-participant doctrine is of a piece with the assumed exception to the dormant Commerce Clause for discriminatory cash subsidies. See, e.g., New Energy Co. v. Limbach, 486 U. S. 269, 278 (1988) ("Direct subsidization of domestic industry does not ordinarily run afoul of [the dormant Commerce Clause]....").
312. But cf. W. Lynn Creamery, Inc. v. Healy, 512 U. S. 186, 199 n. 15 (1994) ("We have never squarely confronted the constitutionality of subsidies, and we need not do so now.").
313. See generally Coenen, supra note 30 (exploring the constitutionality of, and creating an analytic structure for, business subsidies after West Lynn Creamery).
314. 467 U. S. 82 (1984).
315. See id. at 85.
316. See id. at 97-98 (plurality opinion).
317. Id. at 97.
318. Id. at 99.
319. See, e.g., Hillside Dairy, Inc. v. Lyons, 539 U. S. 59, 65-66 (2003) (preventing state from regulating milk prices in connection with its regulation of labeling and composition of milk) ;
320. C & A Carbone, Inc. v. Town of Clarkstown, 511 U. S. 383, 403 (1994) (O'Connor, J., concurring) (listing cases where the Court has embraced such a limitation) ;
321. Wyoming v. Oklahoma, 502 U. S. 437, 458 (1992) (declining to extend state ratemaking authority to related areas of regulation).
322. See New Energy Co. v. Limbach, 486 U. S. 269, 280 (1988). The Ohio statute also extended its tax credit to ethanol produced in other states that granted a similar credit for Ohio-produced ethanol. As the Court has long made clear, however, such reciprocal tax or regulatory favoritism is discriminatory and subject to strict judicial scrutiny.
323. See Sporhase v. Nebraska, 458 U. S. 941, 957-58 (1982) ;
324. Great Atl. & Pac. Tea Co. v. Cottrell, 424 U. S. 366, 370-81 (1976).
325. New Energy Co., 486 U. S. at 277.
326. 520 U. S. 564 (1997)
327. Id. at 594 ("Maine's tax exemption... must be viewed as action taken in the State's sovereign capacity rather than a proprietary decision to make an entry into all of the markets in which the exempted charities function. ").
328. Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1811-12 (2008).
329. Id. at 1812.
330. Id.
331. See id. at 1808-10.
332. 426 U. S. 794 (1976).
333. 447 U. S. 429 (1980).
334. 460 U. S. 204 (1983).
335. See Alexandria Scrap, 426 U. S. at 812-14.
336. See Beeves, 447 U. S. at 443-47.
337. See White, 460 U. S. at 214-15.
338. See, e.g., New Energy Co. v. Limbach, 486 U. S. 269, 277-78 (1988).
339. Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1813-14 (2008).
340. Id. at 1814 n. 17.
341. Id.
342. (quoting S.-Cent. Timber Dev., Inc. v. Wunnicke, 467 U. S. 82, 100 (1984)).
343. In particular, it seems preposterous to argue (as the plurality does) that United Haulers could be explained as resting on this ground. The Court in United Haulers said no such thing-and for good reason: the county was not trying to induce residents to use the municipally owned processing facilities through some financial incentive; it was mandating it. Unlike the counties, private companies lack the ability to force consumers to purchase services from a single supplier-at least not without drawing the attention of the Department of Justice. The counties' waste flow-control ordinances were manifestly regulatory in nature, which is why Oneida and Herkimer Counties abandoned their market-participant exception argument. Cf. United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 363-64 (2007) (Alito, J., dissenting).
344. See Camps Newfound/Owatonna, Inc. v. Town of Harrison, 520 U. S. 564, 593-95 (1997).
345. See S.-Cent. Timber Dev., Inc. v. Wunnicke, 467 U. S. 82, 85 (1984).
346. See Camps Newfound/Owatonna, 520 U. S. at 568.
347. See New Energy Co. v. Limbach, 486 U. S. 269, 271 (1988).
348. Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1814 (2008).
349. See White v. Mass. Council of Constr. Employers, 460 U. S. 204, 220-21 (1983).
350. See, e.g., Camps Newfound/Owatonna, 520 U. S. at 592-93 (stating that the Court's cases "stand for the proposition that, for purposes of analysis under the dormant Commerce Clause, a State acting in its proprietary capacity as a purchaser or seller may 'favor its own citizens over others'"
351. (quoting Hughes v. Alexandria Scrap Corp., 426 U. S. 794, 810 (1976))) ;
352. Wunnicke, 467 U. S. at 93 ("Our cases make clear that if a State is acting as a market participant, rather than as a market regulator, the dormant Commerce Clause places no limitation on its activities.") ;
353. White, 460 U. S. at 208 (reading Reeves and Alexandria Scrap as standing "for the proposition that when a state or local government enters the market as a participant it is not subject to the restraints of the Commerce Clause") ;
354. Reeves, Inc. v. Stake, 447 U. S. 429, 436-37 (1980) (characterizing Alexandria Scrap as turning on the characterization of the State as a participant, not as a regulator, endorsing the distinction as "mak[ing] good sense and sound law"; and arguing that "[t]here is no indication of a constitutional plan to limit the ability of the States themselves to operate freely in the free market").
355. As Larry Tribe put it, "Central heating is a marvelous thing, but it makes little sense in a house without walls." LAURENCE H. TRIBE, AMERICAN CONSTITUTIONAL LAW 1095 (3d ed. 2000).
356. See New Energy Co., 486 U. S. at 277. Dan Coenen shares our concerns, writing that Justice Souter's argument posed three dangers to the market-participant exception: First, that analysis involves a deeply problematic recrafting of the basic rhetoric of market-participant analysis. Second, there exists a serious risk that this new rhetoric will reshape dormant Commerce Clause decisionmaking in undesirable ways. Third, an embrace of Justice Souter's methodology would at least inject new and far-reaching doctrinal uncertainties into this field of law.
357. Coenen, The Supreme Court's Municipal Bond Decision, supra note 8 (manuscript at 15-16).
358. See New Energy Co., 486 U. S. at 277 (holding that simply because a discriminatory tax subsidy "has the purpose and effect of subsidizing a particular industry" it does not therefore become "a form of state participation in the free market") ;
359. id. at
360. ("Ohio's assessment and computation of its fuel sales tax, regardless of whether it produces a subsidy, cannot plausibly be analogized to the activity of a private purchaser.") ;
361. see also Davis, 128 S. Ct. at 1829 (Kennedy, J., dissenting) ("Taxation is a quintessential act of regulation, not market participation. ") ;
362. Camps Newfound/Owatonna, 520 U. S. at 593 ("A tax exemption is not the sort of direct state involvement in the market that falls within the market-participation doctrine.") ;
363. id. at 594 ("Maine's tax exemption-which sweeps to cover broad swathes of the nonprofit sector-must be viewed as action taken in the State's sovereign capacity rather than a proprietary decision to make an entry into all of the markets in which the exempted charities function. ").
364. 468 U. S. 263 (1984).
365. See id. at 271.
366. Id.
367. Id.
368. Id. at 273.
369. Id.
370. The last case to do so appears to be Edgar v. MITE Corp., 457 U. S. 624, 643-46 (1982).
371. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 345-47 (2007). Dan Coenen views the willingness of the Court to apply balancing in United Haulers as an ameliorating feature of what he calls the "state-selfpromotion exception. "
372. Coenen, United Haulers, supra note 8 (manuscript at 27) ("The key point is that the state-self-promotion 'exception' provides an exception only to the antidiscrimination component of the dormant Commerce Clause analysis. It does not provide a wholesale exception that negates dormant Commerce Clause scrutiny altogether.").
373. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1818-20 (2008) ;
374. see also Coenen, United Haulers, supra note 8 (manuscript at 28) ("But wait again! In Davis, the Court identified a new and potentially sweeping limit on the operation of Pike balancing analysis" by questioning the institutional capacity of courts to weigh benefits and burdens (footnote omitted)).
375. See Regan, supra note 5, at 1105-07.
376. See Davis, 128 S. Ct. at 1817. Justice Souter might have added that Pike balancing is not a feature of the Complete Auto test, which assesses the validity of state and local taxes under the dormant Commerce Clause.
377. See Complete Auto Transit, Inc. v. Brady, 430 U. S. 274, 279 (1977). While Davis does concern a tax exemption, the Court treats it more like a non-tax regulation. In any event, the antidiscrimination principle is a feature of the Complete Auto test.
378. Justice Souter added that "Kentucky ha[d] not argued that Pike is irrelevant." Davis, 128 S. Ct. at 1817.
379. Id.
380. Id. at 1817-18
381. (quoting Brief for Respondents at 9, Davis, 128 S. Ct. 1817 (No. 06-666)).
382. Id. at 1818.
383. Id.
384. See id.
385. Id. (emphasis added).
386. See id. at 1818-20.
387. See id. at 1818.
388. Cf. James B. Thayer, The Origin and Scope of the American Doctrine of Constitutional Law, 7 HARV. L. REV. 129, 139-52 (1893) (arguing that courts should invalidate measures only when unconstitutionality is clear).
389. See Davis, 128 S. Ct. at 1817 ("[T]he current record and scholarly material convince us that the Judicial Branch is not institutionally suited to draw reliable conclusions of the kind that would be necessary for the Davises to satisfy a Pike burden in this particular case." (emphasis added)).
390. Id. at 1818.
391. Mark L. Mosley, The Path out of the Quagmire: A Better Standard for Assessing State and Local Taxes Under the Negative Commerce Clause, 58 TAX LAW. 729, 739 (2005).
392. See Davis, 128 S. Ct. at 1818-19.
393. One of us believes that this is the normatively correct approach to the review of nondiscriminatory taxes.
394. In one of our views, that is not fatal to this interpretation. The litigants had not sought such review, and, more importantly, the Kentucky measure so clearly satisfied Complete Auto that there was no point in the Court expressly subjecting the measure to such review.
395. See Davis, 128 S. Ct. at 1817 (calling the applicability an "open question" and noting that market-participant cases do not engage in Pike analysis once the exception is deemed to apply).
396. Id. at 1821 (Scalia, J., concurring in part).
397. See supra note 286 and accompanying text.
398. See Regan, supra note 5, at 1212-20.
399. See, e.g., Yamaha Motor Corp., U. S. A. v. Jim's Motorcycle, Inc., 401 F.3d 560, 570-74 (4th Cir. 2005) (striking down provision of Virginia franchise law) ;
400. PSINET, Inc. v. Chapman, 362 F.3d 227, 239-47 (4th Cir. 2004) (striking down Virginia Internet statute) ;
401. Union Pac. R. R. Co. v. Cal. Pub. Util. Comm'n, 346 F.3d 851, 871 (9th Cir. 2003) (holding that California train safety rules on interstate commerce are a "clearly excessive" burden when compared to local benefits) ;
402. Fla. Transp. Serv., Inc. v. Miami-Dade County, 343 F. Supp. 2d 1315, 1333-34 (S. D. Fla. 2008) (finding that stevedore permitting scheme in operation protected entrenched groups of stevedores and prevented award of permits to new companies and thus imposed an "undue burden" on interstate commerce).
403. See, e.g., Island Silver & Spice, Inc. v. Islamorada, 475 F. Supp. 2d 1281, 1292-94 (S. D. Fla. 2007) (concluding that formula retail ordinance failed Pike balancing as well as heightened scrutiny).
404. See Cooley v. Bd. of Wardens, 53 U. S. (12 How.) 299, 319 (1851) (distinguishing national and local subjects).
405. See Denning, supra note 4, at 437-40 (discussing the rise of the direct/indirect test) ;
406. see also Barry Cushman, Formalism and Realism in Commerce Clause Jurisprudence, 67 U. CHI. L. REV. 1089, 1146-48 (2000) (discussing Chief Justice Stone's criticism of the direct/indirect test a". 'too mechanical'"
407. (quoting Parker v. Brown, 317 U. S. 341, 362 (1943))).
408. See Di Santo v. Pennsylvania, 273 U. S. 34, 44 (1927) (Stone, J., dissenting) ;
409. see also So. Pac. Co. v. Arizona, 325 U. S. 761, 783-84 (1945) (adopting balancing) ;
410. S. C. State Highway Dep't v. Barnwell Bros., 303 U. S. 177, 189-90 (1938) (using the terms "burden" and "benefit").
411. See United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U. S. 330, 346-47 (2007).
412. Cf. Planned Parenthood of Se. Pa. v. Casey, 505 U. S. 833, 854-55 (1992) (joint op.) (discussing factors in deciding whether to overrule precedent).
413. See, e.g., Motor Vehicles Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U. S. 29, 49-52 (1983).
414. See, e.g., Herring v. United States, 129 S. Ct. 695, 700-03 (2009) (balancing need for criminal justice enforcement against individual's Fourth Amendment right to be free from unreasonable searches).
415. Compare Denning, supra note 4, at 453-58 (arguing that Pike balancing should be abandoned)
416. with NORMAN R. WILLIAMS, THE AMERICAN COMMON MARKET 42-43 (forthcoming 2011) (manuscript on file with author) (arguing for retaining Pike).
417. See Dep't of Revenue v. Davis, 128 S. Ct. 1801, 1815-17 (2008).
418. See, e.g., Bush v. Gore, 531 U. S. 98, 109 (2000) (per curiam) ("Our consideration is limited to the present circumstances, for the problem of equal protection in election processes generally presents many complexities.") ;
419. see also Grutter v. Bollinger, 539 U. S. 306, 343 (2003) (limiting endorsement of affirmative action in education to twenty-five years from decision).
420. Cf. United States v. Darby, 312 U. S. 100, 124-26 (1941) (upholding Fair Labor Standards Act, which prohibited manufacture of goods for interstate commerce in violation of act). Our reference in the text to "protectionist taxes or regulations" serves to exempt the market-participant exception from congressional prohibition.
421. Cf. South Dakota v. Dole, 483 U. S. 203, 211-12 (1987) (upholding such conditional grants to states).