Context:

During the Korean War, President Truman did not want to set the same type of price controls that were set during World War II, so he created the “Wage Stabilization Board” to stabilize prices and wages and avoid labor disputes. The Board failed to accomplish this task when the United Steel Workers of America threatened a strike after rejecting wage increases with no price increase. The Truman administration was avidly against the strike from occuring, so the president issued an executive order that required the Secretary of Commerce to seize many steel mills in the country and operate them. Steel companies complied under protest and then sued on the grounds that the president overstepped his powers. The court agreed with the steel companies, claiming that there was no constitutional statute or Congressional backing that would allow the president to usurp private property in this manner. The powers that are granted to the president as Commander in Chief cannot and do not extend into the economy to this extent. Chief Justice Vinson dissented, claiming that the context in which the president used his powers. This case is known for rejecting a president’s use of an emergency power, but the dissent leaves the door open for other interpretations on presidents’ use of executive orders and powers not normally granted to the executive in dire times.

Youngstown Sheet & Tube Co. v. Sawyer

343 U.S. 579

(1952) (Presidential Power)


Facts:

In the latter part of 1951, a dispute arose between the steel companies and their employees over terms and conditions that should be included in new collective bargaining agreements. Long-continued conferences failed to resolve the dispute. On December 18, 1951, the employees' representative, United Steelworkers of America, C. I. O., gave notice of an intention to strike when the existing bargaining agreements expired on December 31. The Federal Mediation and Conciliation Service then intervened in an effort to get labor and management to agree. This failing, the President on December 22, 1951, referred the dispute to the Federal Wage Stabilization Board to investigate and make recommendations for fair and equitable terms of settlement. This Board's report resulted in no settlement. On April 4, 1952, the Union gave notice of a nation-wide strike called to begin at 12:01 a. m. April 9. The indispensability of steel as a component of substantially all weapons and other war materials led the President to believe that the proposed work stoppage would immediately jeopardize our national defense and that governmental seizure of the steel mills was necessary in order to assure the continued availability of steel. Reciting these considerations for his action, the President, a few hours before the strike was to begin, issued Executive Order 10340. The order directed the Secretary of Commerce to take possession of most of the steel mills and keep them running. The Secretary immediately issued his own possessory orders, calling upon the presidents of the various seized companies to serve as operating managers for the United States. They were directed to carry on their activities in accordance with regulations and directions of the Secretary. The next morning the President sent a message to Congress reporting his action. Twelve days later he sent a second message. Congress has taken no action.

Obeying the Secretary's orders under protest, the companies brought proceedings against him in the District Court. Their complaints charged that the seizure was not authorized by an act of Congress or by any constitutional provisions. The District Court was asked to declare the orders of the President and the Secretary invalid and to issue preliminary and permanent injunctions restraining their enforcement. Opposing the motion for preliminary injunction, the United States asserted that a strike disrupting steel production for even a brief period would so endanger the well-being and safety of the Nation that the President had "inherent power" to do what he had done -- power "supported by the Constitution, by historical precedent, and by court decisions." The Government also contended that in any event no preliminary injunction should be issued because the companies had made no showing that their available legal remedies were inadequate or that their injuries from seizure would be irreparable. Holding against the Government on all points, the District Court on April 30 issued a preliminary injunction restraining the Secretary from "continuing the seizure and possession of the plants . . . and from acting under the purported authority of Executive Order No. 10340." On the same day, the Court of Appeals stayed the District Court's injunction. Deeming it best that the issues raised be promptly decided by this Court, we granted certiorari on May 3 and set the cause for argument on May 12. 

Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952)

Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952)

Issue:

Whether the President was acting within his constitutional power when he issued an order directing the Secretary of Commerce to take possession of and operate most of the Nation's steel mills. 

Two crucial issues have developed: First. Should final determination of the constitutional validity of the President's order be made in this case which has proceeded no further than the preliminary injunction stage? Second. If so, is the seizure order within the constitutional power of the President?

Reasoning:

I

Prior cases in this Court have cast doubt on the right to recover in the Court of Claims on account of properties unlawfully taken by government officials for public use as these properties were alleged to have been. Moreover, seizure and governmental operation of these going businesses were bound to result in many present and future damages of such nature as to be difficult, if not incapable, of measurement.

II

The President's power, if any, to issue the order must stem either from an act of Congress or from the Constitution itself. There is no statute that expressly authorizes the President to take possession of property as he did here. Nor is there any act of Congress to which our attention has been directed from which such a power can fairly be implied.

Moreover, the use of the seizure technique to solve labor disputes in order to prevent work stoppages was not only unauthorized by any congressional enactment; prior to this controversy, Congress had refused to adopt that method of settling labor disputes.

It is clear that if the President had authority to issue the order he did, it must be found in some provision of the Constitution.

The order cannot properly be sustained as an exercise of the President's military power as Commander in Chief of the Armed Forces. We cannot with faithfulness to our constitutional system hold that the Commander in Chief of the Armed Forces has the ultimate power as such to take possession of private property in order to keep labor disputes from stopping production. This is a job for the Nation's lawmakers, not for its military authorities.

Nor can the seizure order be sustained because of the several constitutional provisions that grant executive power to the President. The President's power to see that the laws are faithfully executed refutes the idea that he is to be a lawmaker. The Constitution limits his functions in the lawmaking process to the recommending of laws he thinks wise and the vetoing of laws he thinks bad. And the Constitution is neither silent nor equivocal about who shall make laws which the President is to execute. The first section of the first article says that "All legislative Powers herein granted shall be vested in a Congress of the United States . . .." After granting many powers to the Congress, Article I goes on to provide that Congress may "make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."

Justice Black decides Youngstown Sheet & Tube Co. v. Sawyer

Holding:

The Founders of this Nation entrusted the lawmaking power to the Congress alone in both good and bad times.

Jackson’s Concurrence

Presidential powers are not fixed but fluctuate, depending upon their disjunction or conjunction with those of Congress. We may well begin by a somewhat over-simplified grouping of practical situations in which a President may doubt, or others may challenge, his powers, and by distinguishing roughly the legal consequences of this factor of relativity.

1. When the President acts pursuant to an express or implied authorization of Congress, his authority is at its maximum, for it includes all that he possesses in his own right plus all that Congress can delegate. In these circumstances, and in these only, may he be said (for what it may be worth) to personify the federal sovereignty. If his act is held unconstitutional under these circumstances, it usually means that the Federal Government as an undivided whole lacks power. A seizure executed by the President pursuant to an Act of Congress would be supported by the strongest of presumptions and the widest latitude of judicial interpretation, and the burden of persuasion would rest heavily upon any who might attack it.

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. Therefore, congressional inertia, indifference or quiescence may sometimes, at least as a practical matter, enable, if not invite, measures on independent presidential responsibility. In this area, any actual test of power is likely to depend on the imperatives of events and contemporary imponderables rather than on abstract theories of law. 

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. Courts can sustain exclusive presidential control in such a case only by disabling the Congress from acting upon the subject. Presidential claim to a power at once so conclusive and preclusive must be scrutinized with caution, for what is at stake is the equilibrium established by our constitutional system.


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Key Takeaway

Vital industries may be seized during war, but it must be done by Congress, not the president.

There are two places to look if President has prescribed power: (1) Act of Congress – no statutory authority existed. In fact, Congress explicitly rejected such a provision in the Taft-Hartley Act. The President in times of emergency that would threaten national security must go to a District Court judge to seek an injunction under the Taft-Hartley Act. Truman did not do this. (2) Constitution – Commander in Chief power does not have that broad of a scope, and no military activity is taking place. Also, the President only has the “take care and enforcement” power. Congress passes laws; the President enforces them. Here the President is legislating and making law. The government argued that there is a historical argument. Even historical precedent does not take away Congress’s power to make laws necessary and proper to carry out the enumerated powers of the Constitution.

Jackson’s concurrence became the standard for evaluating presidential power in relation to Congress.


Court Syllabus:

To avert a nation-wide strike of steel workers in April 1952, which he believed would jeopardize national defense, the President issued an Executive Order directing the Secretary of Commerce to seize and operate most of the steel mills. The Order was not based upon any specific statutory authority but was based generally upon all powers vested in the President by the Constitution and laws of the United States and as President of the United States and Commander in Chief of the Armed Forces. The Secretary issued an order seizing the steel mills and directing their presidents to operate them as operating managers for the United States in accordance with his regulations and directions. The President promptly reported these events to Congress, but Congress took no action. It had provided other methods of dealing with such situations and had refused to authorize governmental seizures of property to settle labor disputes. The steel companies sued the Secretary in a Federal District Court, praying for a declaratory judgment and injunctive relief. The District Court issued a preliminary injunction, which the Court of Appeals stayed. 

Held:

1. Although this case has proceeded no further than the preliminary injunction stage, it is ripe for determination of the constitutional validity of the Executive Order on the record presented.

(a) Under prior decisions of this Court, there is doubt as to the right to recover in the Court of Claims on account of properties unlawfully taken by government officials for public use..

(b) Seizure and governmental operation of these going businesses were bound to result in many present and future damages of such nature as to be difficult, if not incapable, of measurement.

2. The Executive Order was not authorized by the Constitution or laws of the United States, and it cannot stand.

(a) There is no statute which expressly or impliedly authorizes the President to take possession of this property as he did here.

(b) In its consideration of the Taft-Hartley Act in 1947, Congress refused to authorize governmental seizures of property as a method of preventing work stoppages and settling labor disputes.

(c) Authority of the President to issue such an order in the circumstances of this case cannot be implied from the aggregate of his powers under Article II of the Constitution.

(d) The Order cannot properly be sustained as an exercise of the President's military power as Commander in Chief of the Armed Forces.

(e) Nor can the Order be sustained because of the several provisions of Article II which grant executive power to the President.

(f) The power here sought to be exercised is the lawmaking power, which the Constitution vests in the Congress alone, in both good and bad times.

(g) Even if it be true that other Presidents have taken possession of private business enterprises without congressional authority in order to settle labor disputes, Congress has not thereby lost its exclusive constitutional authority to make the laws necessary and proper to carry out all powers vested by the Constitution "in the Government of the United States, or any Department or Officer thereof."


How the Justices Voted

Majority: Black, joined by Frankfurter, Douglas, Jackson, Burton

Concurrence: Frankfurter

Concurrence: Douglas

Concurrence: Jackson

Concurrence: Burton

Concurrence: Clark

Dissent: Vinson, joined by Reed, Minton