Price Controls

Rent and Price Controls (Constitution at Home in Wartime)

Even at a time when the Court was using substantive due process to void economic regulations, it generally sustained such regulations in wartime. Thus, shortly following the end of World War I, it sustained, by a narrow margin, a rent control law for the District of Columbia, which not only limited permissible rent increases but also permitted existing tenants to continue in occupancy provided they paid rent and observed other stipulated conditions.1 Justice Holmes for the majority conceded in effect that in the absence of a war emergency the legislation might transcend constitutional limitations,2 but noted that “a public exigency will justify the legislature in restricting property rights in land to a certain extent without compensation.” 3

More about Price Controls

During World War II and thereafter, economic controls were uniformly sustained.4 An apartment house owner who complained that he was not allowed a “fair return” on the property was dismissed with the observation that “a nation which can demand the lives of its men and women in the waging of . . . war is under no constitutional necessity of providing a system of price control . . . which will assure each landlord a 'fair return' on his property.” 5 The Court also held that rental ceilings could be established without a prior hearing when the exigencies of national security precluded the delay which would ensue.6

Price Controls: Developments

But, in another World War I case, the Court struck down a statute that penalized the making of “any unjust or unreasonable rate or charge in handling . . . any necessaries” 7 as repugnant to the Fifth and Sixth Amendments in that it was so vague and indefinite that it denied due process and failed to give adequate notice of what acts would violate it.8

Resources

References

This text about Price Controls is based on “The Constitution of the United States of America: Analysis and Interpretation”, published by the U.S. Government Printing Office.

[Footnote 1] Block v. Hirsh, 256 U.S. 135 (1921).

[Footnote 2] But quaere in the light of Nebbia v. New York, 291 U.S. 502 (1934), Olsen v. Nebraska ex rel. Western Reference and Bond Ass'n, 313 U.S. 236 (1941), and their progeny.

[Footnote 3] Block v. Hirsh, 256 U.S. 135, 156 (1921).

[Footnote 4] Yakus v. United States, 321 U.S. 414 (1944); Bowles v. Willingham, 321 U.S. 503 (1944); Lockerty v. Phillips, 319 U.S. 182 (1943); Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111 (1947); Lichter v. United States, 334 U.S. 742 (1948).

[Footnote 5] Bowles v. Willingham, 321 U.S. 503, 519 (1944).

[Footnote 6] 321 U.S. at 521. The Court stressed, however, that Congress had provided for judicial review after the regulations and orders were made effective.

[Footnote 7] Act of October 22, 1919, 2, 41 Stat. 297.

[Footnote 8] United States v. L. Cohen Grocery Co., 255 U.S. 81 (1921).

Tables of Contents

• Price Controls and other Topics in the Contents – Article 1 of the U.S. Constitution
• U.S. Constitutional Law Category
• List of amendments to the U.S. Constitution
• Price Controls and other Topics in the Constitution Contents
• Interpretation of the U.S. Constitution (Table of Contents)
• Clauses of the Constitution (Table of Contents)