Patel v. Texas Department of Licensing & Regulation


Differing Levels of Scrutiny for Economic Regulations: “Anything Goes” Rational Basis v. Rational Basis “With Bite”

Jarrett Dieterle April 26, 2017

Recently, the South Carolina Supreme Court issued a decision striking down a state law that limited the number of liquor retail outlets that a single owner could operate within state boundaries. The Court held that the law’s sole justification was economic protectionism, which made it an improper use of the state’s police powers to regulate alcohol. R Street Institute fellow Jarrett Dieterle takes an in-depth look at case in this three-part blog series.

The first part of the series analyzed the reasoning used by the South Carolina Supreme Court in reaching its decision. Part two will explore the differing levels of constitutional scrutiny that economic regulations have received during our nation’s history.

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The fight over how to treat economic liberty under the Constitution has been as lengthy as it has been acrimonious. Under current constitutional jurisprudence, certain types of recognized rights—so-called “fundamental rights”—receive more robust judicial protection (known as “strict scrutiny”) than other rights. In order for a government to infringe upon these “fundamental” rights, it must have a compelling interest and adopt the least intrusive means to advance that interest. This requires an inquiry into both the goals of the infringing law and the means the law adopts to achieve those goals. [Read More]


Don’t Thread on Me

Anthony Sanders, Nick Sibilla July 13, 2016

A landmark decision against bureaucratic browbeating has advocates for limited government, free markets, and shapely eyebrows celebrating. One year ago, in Patel v. Texas Department of Licensing & Regulation, the Texas Supreme Court ruled against a state agency that forced eyebrow threaders to complete 750 hours of training before they could legally work.[1] This decision on a little-known beauty practice is actually one of the most significant rulings in favor of economic liberty since the New Deal. The ruling by the Texas Supreme Court can both defend entrepreneurs from an ever-encroaching regulatory state and reinvigorate a languishing tradition of protecting honest enterprise under state constitutions. [Read More]