The Myth of Laissez-Faire Constitutionalism: Liberty of Contract during the Lochner Era

The Article examines the U.S. Supreme Court\u27s protection of liberty of contract as a fundamental constitutional right during the forty-year period from 1897 until 1937, the so-called Lochner era, named for the Court\u27s best-known liberty-of-contract decision in 1905, Lochner v. New York. The Article shatters many myths about this era, particularly the notion that the Court was engaged in so-called laissez-faire constitutionalism, which was derived from Justice Oliver Wendell Holmes\u27s famous dissent in Lochner. Although Holmes\u27s characterization of the majority\u27s decision in Lochner as activist has shaped the orthodox view, both Holmes and the orthodox view are clearly wrong-unfair caricatures of what the Court was really doing in its liberty-ofcontract jurisprudence. It is the constitutional law equivalent of a modem urban legend. Among other things, the Article explains liberty-of-contract jurisprudence on its own terms, distinguishing it from true laissez-faire constitutionalism, and showing that, rather than engaging in judicial activism, the justices were adhering to objective, wellestablished principles of constitutional law