Letter from Attorney General William Mitchell to President Herbert Hoover

OF Uffice of theAtturney General COMINA JUSTITIA xipil November 21, 1931. The President, The White House. My dear Mr. President: I have your letter of November twentieth asking me for an off- hand opinion as to whether an act of Congress obliging employers of labor to establish unemployment insurance systems would be consti- tutional. There are two questions which arise at the outset. The first is whether power to establish such systems, if the power exists, rests with Congress or with the state legislatures, and the second is whether the legislative authority which has power to deal with the subject, whether state or national, may constitutionally force such systems on the employers. Considering the first aspect of the matter, I think it is clear that an act of Congress which attempted to compel employers of labor generally to establish unemployment insurance systems would be unconstitutional for the reason that except in very limited fields the police power to deal with such a matter rests with the states. There is no clause inlthe Federal Constitution which I can think of which gives to the national Congress power generally to regulate the relations between employer and employee throughout the United States. Congress has police power to deal with such matters in the District of Columbia and in those areas like the territories where it exercises exclusive sovereignty, but within the boundaries of the states it has no general police power and no power generally to regulate the relations of employer and employee, and it could only do so where such action is justified by some express power contained in the Constitution such as the commerce clause. Under the commerce clause Congress has power to regulate the relations between interstate railroads and their employees because the rail- roads are instrumentalities of commerce.