LAW AND ECONOMIC DEVELOPMENT: THE STATE AND PUBLIC LAW

I. Introduction: the new historical wisdom, the years from c. 1815 to 1860 as the creation of a market society with exchanges, prices, and cash transactions (the rules of capitalism) as the governing principles--what, if anything, was the role of law in creating or sustaining a commercialized market society--J.W. Hurst, law and the release of "creative energies" in the service of the "people"--Morton Hurwitz and law as the servant of capitalism or those with the most money and property--all related to the old Anatole France irony about what he labeled "bourgeois law."

Law as constitutive; law as reflective--judges as law-makers or law-finders--common law vs. positive law--public law vs. private law, and how both of the latter relate to economic development.

And also the essential and vital ingredient of creating a new nation that works and endures.

1. From Hamiltonianism to American Plan: Tariffs, Banks, Internal Improvements.

2. The Separate States and the Promotion of Economic Growth: Turnpikes, Canals, Railroads, Chartered and Corporate Monopolies

1. The New York Steamboat Monopoly (Gibbons v. Ogden)--the issues involved and how they are resolved--Chancellor Kent and the state's power to serve the public interest by privileging the rights of investments of risk-takers--the split opinion on New York's highest court and a reversal, and the logic behind it: what really serves the public interest?--John Marshall speaks for the Supreme Court and federal supremacy in the arena of interstate commerce--part of Marshall's will to create a truly effective, and also sovereign national state.

2. The Charles River Bridge Case and its Resolution (1837)--compare to steamboat monopoly case--what leads both the Massachusetts court and the Supreme Court to find against the original chartered monopoly? Again "free enterprise" liberated in the service of the public interest or commonwealth--why commonwealth principle so salient in the case of Massachusetts!

3. The Bank of the United States and McCulloch v. Maryland (1819)--summarize the complicated history of the Bank of the U.S. and its role in the economy--what the state of Maryland attempted to do, tax the bank out of existence--the double-edge of Marshall's finding: an elastic constitution adaptable to changing times, and the supremacy of national authority--states may not use their reserved powers to destroy the federal power.

4. Courts and the Law of Eminent Domain--what is the principle of eminent domain? How does the principle clash with the Constitution? The "takings clause," due process, and just compensation--How does the principle clash with the common law heritage? Undiminished or undiluted enjoyment and use of one's own property--why eminent domain so important to the creation of a marketplace, or capitalist, society: building an economic infrastructure: turnpikes, canals, railroads, and urban development--private property rights v. public benefit or community welfare--the favored resolution--and Wednesday we'll see how all this also relates to the private law of torts, liabilities, and negligence.

1. Andrew Jackson, the Bank War, and a Different View of Constitutionalism--another sort of release of creative energies, this time a new rule or law of unintended consequences.

2. The Depression of 1837, State Default, and Restrictive State Constitutions

3. General Incorporation Laws--explain the importance of corporations to economic development and the case for general laws.

4. Popular Election of State Appellate Judges--law-makers and the principle of popular sovereignty.

V. Conclusion: The Realities of a Marketplace Society--Most economic transactions occur in the private arena, not the public sphere, between private parties, not public officials, or the state and private parties--hence the common law becomes the central battleground in accommodating law to capitalism.