State v. Greeson – Tennessee, 1939 (124 S.W.2d 253); Buckstaff Bath House Co. v. McKinley – Arkansas, 1939 (127 S.W.2d 802), affirmed, ___ U.S. ___ (____); Noble v. Davis – Arkansas, 1942 (161 S.W.2d 189)

• Unemployment compensation laws, first proposed in the United States in 1920, gained traction during the Depression.  In some regions employers challenged unemployment fund assessments, arguing that the assessments deprived them of property without due process of law, but most challenges faded away after the U.S. Supreme Court upheld Alabama’s law in Carmichael v. Southern Coke & Coal Co. (1936) and in Buckstaff, decided three years later, Arkansas’s supreme court held that such laws were well within the state’s police power.

• It was an article of faith among New Deal-era economists that falling prices and rising unemployment were largely due to predatory competitive practices and that those problems could be solved by enacting fair trade practice codes for major industries, including statutory price restrictions.   Franklin Roosevelt implemented the theory in the National Industrial Recovery Act, and after the U.S. Supreme Court upheld a milk dealer fair-competition code, including price restrictions, in Nebbia v. New York (1934), many states followed suit. 

• The laws were unsuccessful, and during their heyday they generated much legal controversy.  Relatively few such laws were enacted in the mountain South, and the region’s courts eyed the laws critically.  In Greeson and Noble, the Tennessee and Arkansas supreme courts struck down laws fixing the prices barbers could charge; they reasoned that the price-fixing provisions did not promote public health or safety and were not justified under the police power. 

Up from poverty:   industrial development laws

Azbill v. Lexington Manufacturing Co. – Tennessee, 1949 (221 S.W.2d 522); Faulconer v. City of Danville – Kentucky, 1950 (232 S.W.2d 80); Halbert v. Helena-West Helena Industrial Development Corp. – Arkansas, 1956 (291 S.W.2d 802)

• During the Depression, Mississippi devised a “Balance Agriculture with Industry” (BAWI) law, which helped provide a short-term boost to its economy and soon caught on in other Southern states.  BAWI laws created local agencies to build plants for use by industry and give financial incentives for companies to use the new facilities, thus creating a new local industry and new jobs.

• BAWI laws were challenged as impermissible state intrusions into private enterprise, laws that interfered with market forces and were not sufficiently related to public welfare to come within the police power.  Mississippi’s supreme court upheld its state’s BAWI law in strong terms (§ ___), reasoning that desperate economic times required a broad view of the scope of state’s police power and a tolerant view of experimental laws.  Courts in the mountain South divided.  In 1949, Tennessee’s supreme court took a narrower view of public purpose and struck down a law permitting ___ to build and lease a new factory, but in the 1950s, in Faulconer and Halbert, Kentucky’s and Arkansas’s supreme courts sided with Mississippi’s liberal view of public purpose noting that such laws were now becoming common throughout the United States.  

“The promotion of the interests of individuals, … although it may result incidentally in the advancement of the public welfare, is, in its essential character, a private and not a public object.  However certain and great the resulting good to the general public, it does not, by reason of its comparative importance, cease to be incidental.” – Ferrell v. Doak -  Tennessee, 1925 (275 S.W. 79), relied on by the court in Azbill 

“The consensus of modern legislative and judicial thinking is to broaden the scope of activities which may be classed as involving a public purpose.  (cite) It reaches perhaps its broadest extent under the view that econ welfare is one of the main concerns of the city, state and the fed governments.  This is manifested by the great bulk of recent social security programs of the nation and the state.” – Justice __, in Faulconer