Acta Universitatis Nicolai Copernici. Nauki Humanistyczno-Społeczne. Prawo, z. 18 (106), 1979

A C T A U N I V E R S I T A T I S N I C O L A I C O P E R ,N I C I 


PRAWO 


XVIII 


LAW 
xVIIi 
PRACE AMERYKANISTYCZNE 


AMERICAN P APERS 


Nauki 
Humanistyczno-Społeczne 


Zeszyt 106 


/ 


T O R U N 1979
>>>
Recenzent 


LONGIN P ASTUSIAK 


Redaktor naukowy 


JAN GŁUCHOWSKI 


Redaktor 


Agnieszka Bojarska 


Redaktor techniczny 


Jadwiga Gosieniecka 


Korektor 


Henryk Zieliński 


UNIWERSYTET MIKOŁAJA KOPERNIKA W TORUNIU 


Wydanie 1. Nakład 400+70 egz, Ark. wyd, 9,44, Ark, druk. 9,5, Pa- 
pier druk. III kl. 80 g, 70X100, podpisano do druku w grudniu 1979 r, 
Druk ukot'!czono w grudniu 1979 r, Zam. nr 732. Cena zł 39,- 


ZAKŁAD PpLIGRAFIl UMK
>>>
FOREWORD 


Reciently iSocialist countries we have witnessed a growing interest 
in a set oj American rproblems. 
In the Soviet Union sCientijic endeavars cbncerning these American 
topics are carried out first oj all, by The Institute oj U.S. and Canadian 
Studies oj the Academy of Sciences of the U.S.S.R., which publihes es 
a monthly journal "U.S.A. Economics Politics Ideology". 
In Poland, The Institute of State and Law, The Polish Academyof 
Sciences used to deal with these topics. At present the research in the 
area of American problem is pursued by The Polish Institute of Inter- 
national Affairs, The Institute of History of the Poli;sh Academy of 
Sciences and The ResefLrch Institute of Contemporary Capitalist Problems. 
The authors oj the papers included' in this collection are mainly 
forme1' and present scholars oj the faculty of Law and Administration 
at Nicholas Copernicus University. In additionhowever W. J. Wagner is 
a professor at the University oj Detroit, and K. Norek is an assistent 
at the Technical and Agricultural Academy of Bydgoszcz. The majority 
of authors pursue their scientific endeavors in the U.S. 
This publication reflects among other things the, scholarly production 
of the Toruń Law Faculty in the area of research on selected American 
problems. 


Editor-in-chief 
Jan Gluchowski
>>>
A C T AU N IV E R S I T A T I S NICO LAI C O P E R N I C I 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT '106 - 1979 


Department of International Law 
and International Economic Relations 


Janusz Gilas 


LEGAL INSTRUMENTS FOR THE UNITED ST ATES FOREIGN TRADE 


C o n t e n t: Statutory Law Instruments for the United States Foreign Trade. 
International Agreements on International Trade Binding the United States. Lega! 
Instruments for Trade Relations. between the United States and the Socialist Coun- 
tries. Conc1usions. 


StatisTICS made it known that the participation of the United States in 
the international trade both in import and export is systematically exten- 
de.d. In the last years the volume óf the United States export to a:1l 
geographical and political regions have risen, and the same has occurred 
in- import,although its volume was sharply reduced in 1975 1. In the light 
of these observationsaffirming the position of the United States in inter- 
national trade it is understandable that the aspectsof the legal instru- 
ments for the participation of the United States in international trade are 
of interest in other countries. 


STATUTORY LAW INSTRUMENTS FOR THE UNITĘD STATES 
FOREIGN TRADE 


After the second world war the United States legislation on foreign 
trade was modelled accoTding to the principles of free trade doctrine, 
although foreign trade with socialist countries according tocontainement 
theory was curbed in order "to prevent Communist penetration". In the 
United States tendency to adopt a new doctrinal directive of protectio- 
nism in fO!l'eign trade legislation has grown since 1970. This tendency was 
seen in TTade Act of 1970, known as Mi1ls Bill, which was however 
blócked in Senate and was not backed by the acłministration in 1971. 3 


1 The World Alamanc 1978, New York 1977, p. 108-109. 
· K. Grzybowski, V. Rud, G. Stepanyenko, Towards integrated ma- 
nagement of international trade 
 The U.S. Trade Act ot 1974, The International 
and Comparative.Law Quarterly, 1977, v. 26, part II, 4th S.eries, p. 285.
>>>
6 


Janusz Gilas 


Unsucessful were also praposals ta praceed with the Fareign Trade and 
Investment Act of 1972, known as Burke-HaTtke Bill, which went inta 
the direction of protect10nism through the mediums af mandatory quatas, 
curtailing of certain preferential tariff treatment, refarm af the antidump- 
ing and countervailing duty laws. However the palicy was not changed, 
and rathel' free t!radeposition was taken, when in 1973 the Trade Refarm 
Act was prepared by the Nixon administration, which aft er Congress 
deliberatians became known a,s Public Law 93-618, which was signed by 
President Ford 'On January 3,1975. 3 
The Trade Act of 1974 deals with such topics as negotiating authority, 
trade with cauntrie:s currently not receiring nan-d1iscriminatory treatment, 
generalized system af preferences, :relief fram injury caused by impart 
'campetitian, relief from unfair trade practices. The Act is adresśed bath 
to friedly natians, as well as ta oompetitive naUons. Howeverr one must 
admit that the MFN c1ause can be negotiated with socialist states on 
canditians af freedom af emigratian.This link is unacceptable in fareign 
tracie and C8n he questioned in the light af principles laid down in inter- 
national trade documents, as GATT, Geneva Final Act of 1964 and New 
Economic Order principles. 
It is important that in the Trade Act af 1974 far the first time Con- 
gress accepted United States membe:rship in GATT, which inf1uences 
highly the position of the individual cauntry toward practically all impor- 
tant countries on the scene af international trade, with exc1usian of the 
sacialist countries, which in majarity k not beoome members of this 
internatianal organization. 4 Under the Act the President abtained the 
autharity to negotiate changes in the GATT structUire and to harmonize 
legislative principles with internatianal agreements negotiated under 
GATT auspieces. 5 
The Act established the principles of management of foreign trrade 
policy in the United States. The most important naturally are prerogatives 


· Ibid., p. 288-291. 
« Sec. 121 (d) of the 1974 Act. 
5 The aims of the authority of the President to revise the GATT are folIowing: 
(1) revision of decision mak ing procedures of the GATT, (2) expansion of the 
safeguard provision (Article XIX) to cover all forms of import restraints countries 
use in response to injurious competition, (3) extension of the Agreement to matters 
not presently covered to move toward fair trade practices, (4) the adoption of 
international fair labor standards, (5) revision of the Agreement with respect to the 
treatment of border adjustments for internal taxes, (6) revision of the Agreement to 
recognize import surcharges as the preferred response to balance of payments deficits, 
(7) strenghtening of the Agreement in respect of impositons of export controls, the 
denial of the fair and equitable access, (8) the establishment of sanctions with respect 
to su ch countries which deny fair and. equitable access to supplies of food, raw ma-
>>>
Lega! Instruments for the United States Foreign Trade 


7 


of the President. He is entitled to enter into tracie agreements aimed at 
elimi:nating tarlif and nan-tariff baITieI"is and simi1ar distOirtions, agre- 
ements aimed at effecting GATT revisians, agreements extending non- 
discriminatory (MFN clause) treatment, agreements which aim to p['ovid e 
relief from injury catised by impart campetition. This autho\rity usually 
was given to the President f 'Ol' five years, butcan be extended far an 
additional tWQ years. When the p,resident enter s in trade agreements 
aiming at eliminating nan-tariff bauiers and similar distartions he must 
cansult Cangress, same oi Senate and Hause af Representatlves cammit- 
tees. The reservation far the Cangress its right of final approval with 
respect ta mast, but not a11, of the activities authorised bythe 1974Act 
can be seen in the whole Act. 6 
The President is auth'Orized t'O proc1aim modificatians in !l'ates of 
duties in connection with trade agreements when he determines that 
existing duties af a foreign cauntry or af the United States have restri- 
ctive effect 'On the fareign ttade of the United States. He 1S authorized to 
decrease duties belaw the rates in effect on January 1, 1975 far 5% ad 
valorem ar less withbut any limitations and over 5% ad valorem on 
reservatian that reductions may nat exceed 60% ofthe existing duties. 
Whenever duty reductions exceed 10% af the prior rate they would be 
staged aver a period of time at an annual rate not exoeeding 3% ad 
valorem Ol' 1/10 af the total reduction. The Presiderrt is alga authorized 
in connection with negatiation af trade agreements to increa5e rates of 
duties, however the increase cannot be higher than 50% 'Of the specific 
duties, or 20% ad valorern abave the rate existing on January 1, 1975. 
The President is also authorized totake extraardinary steps in situa- 
tions of large and serious U.S. balance af payments deficits ar significant 
depreciation of the do11ar, orwhen it is necessary tQ correct internatianal 
balance af payments disequilibria. In such situations the Pre'Sident cal1 
proc1aim import surcharges, but not exceeding 15% ad valorem. The 
reverse situation occurrs when the United States has expe!l'ienced large, 
persistent, trade surpluses, which require an increase in U.S. imports. In 
this situatian the President can reduce tempora1rily duty, but not mare 
than 50/0 ad valorem. 7 It is also necessary to stress that the Trade Act 
terials, semi-manufactured and manufactured commodity, (9) establishment of the 
system of regular consultations and the resolution of commercial disputes, (la) re- 
visions intending to apply principles of reciprocity and non-discrimination and 
elimination of special preference and reverse preferences, (11) revisions of the 
procedure for ,the subsidy to industrie s products for export and to attract foreign 
investment, and '(12) negotiation to establish within the GATT an international 
agrement on particular articles (inclu;1ing footwear). TitleI, Ch. 2 of the Act. 
fi K. G r z y b o w s k i, V. R u d, G. S t e p a n ye n k o, op. cit., p. 321. 
7 Title I, Sec. 122.
>>>
8 


Janusz Gilas 


af 1974 established within the Executive Office of the President the Office 
of the Special Representative far Trade Negotiations. 8 
Many provisians of the Trade Act 'Of 1974 deal with relief measures 
from unfair trade practices. There were inc1uded provisi!ons authorizing 
administratian to cope with foreign import res1:Jrictions, export subsidies, 
dumping 
d other unfair trade practices. As 'l'etalia tion against foreign 
import restrictionsaffecting the United States foreign trade the President 
can order retaliatiQn duties and o1Jhe!l' unfriendly steps on s'elective basis 
against those states which impase unjustifiable Ol' unreasonable restric- 
tians against the United States goods, services, inc1uding shipping, avia- 
tion and insurance industries. Any interested party can petitian the 
Special Representativefar Trade Negotiations ta conduct a review, with 
public hearings af practices and policies characterized as unfair trade 
practices. 
Impo,rtant municd.pal instrument in the United States is Antidumping 
Act of 1921. 9 On this basi s special procedure is adopted when the Se- 
cretaryof the Treasury determines that a c1ass Ol' kind af foreign mer- 
chartdise is being, 'OT is likely ta be, sold in the United States at less than 
its fair value. The Secretary of the Treasury cooperates in thisfield with 
the United States Tariff Commissian. When any imported merchandise 
is believed Ol' surspected by the Secretary of the Treasury on the basis of 
invoice, other papers Ol' firm infurmation to be sold on price less than the 
foreign market value the Secretary shall pu:blish the natice in the Fede- 
raI Register. He may prescribe the withholding 'Of appraisement reports 
as t'O such merchandise entrance, and withdrawirig it from warehause OT 
consumpti'On. Specialantidumping duty in am'Ount equal to dumping 
margin can be levied on merchandise sald 'On price less than the foreign' 
value. However, foreign market value i8 established by the U.S. authari- 
ties accarding to the p!l'inciple that by it 'One understands the price at 
the time ofexportation of such merchandise t'O the United States at which 
such oc simiłar merchandise is sold a!l' offered foc sale in the principal 
markets of the country from which it is exported. Such practice is 
unfair, because it daesnot take into cansideration that internal and 
fareign trade prices alre different, the latter being usually higher. The 
antidumping pracedure in the United States is 'One af the abstac1es to 
the East-West internatianal trade, because the socialist merchandises are 
usually labelledas dumping ones. 10 


8 Title I, ch. 4. 
· Title II of Public Law 67-10, amended in 1954, 1958 and 1970. 
10 There ls quoted in the Soviet economic literature an. example of the contract 
for selling of 10000 cars "Moskvich", which was terminated because the United 
States authorities wanted from the Soviet Union information dealing with the costs
>>>
Legal Instruments for the United States Foreign Trade 


9 


In some :respects the antidumping prooedure was changed in the Trade 
Act of 1974. It provides that not 'Only United State:s manufacturers, 'P ro - 
ducers, Ol' whalesalers 'Of the merchandise but also foreign manufacture rs , 
e
porters and domestic importer s have the same right toO appear at 
hearlngs before the Secretary 'Of the Treasury ar the United States Tarlff 
Commission. Under the resolution oi the Commissian the Secretarry of 
the Treasury can postpone an antidumping procedure if the first resolves 
that the Un'ited Stłltes industry is not injured by the import s of dumping 
merchandise. The Act also adopted new terms for the antidumping pro- 
cedure which must be closed within 6 manths or 9 months in especially 
com'Plicated cases. The decisian oOf the Secretary must be published within 
30 days from the receipt af infarmation. The new pravisians are anes 
dealing with dumping ipractices af the multinatianal corporations opeTa- 
ting in several foreign cauntries which dump their merchandises in 
the U.S. markets beeause the are subsidized by high-priced sales in other 
foreign cauntries. The Ad also provides that the United States manufac- 
turers and praducers have stand in the U.S. customs caurts with respect 
ta negat'ive antidumping decisions by the ,Secretary of the Treasury. 
The countervailing duties are anather instrument af the foreign trade 
policy. Ac,eording to the sectian 303 of the Tarlff Act af 1930 the Secreta- 
ryaf the Treasury had the auth'Ority to impose such duties upon impor- 
ted merchandise if this merchandise, produdion, Ol' eXp'I't benefi
ed from 
a bounty or a grant. The Foredgn Trade Ad af 1974 changed in many 
re
cts provisions dealing with cauntervailing duties. The main respon- 
sibility in this area was conferrred on the Secretaryaf the Treasury. The 
petition that the imported merchandise benefits fram a bounty ar grant 
is. piresented ta the Secretary af the Treasury. It is published in the 
Federal Register. The Secretarry'has the autharity ta make investigations 
in this respect for the first six months and during next six months to 
negotiate with the particular foOreign country in an attempt ta obtain 
elimination af the subsidy. 1£ the negotiati'Ons faU the Secretary of the 
TreasU'ry is required to issue a final countervailing duty order. 
The Foreign Trade Act af 1974 contains nat only provision:s dealing 
with discriminatory instruments 'Of the foreign trade policy but also 
provisians authorizing the President to manipulate the gene!l'alized system 
of preferences. The Bresident has privilege tlO extend duty-free treatment 
to certain eligib1e products impoOrted into the United States from bene- 
ficiary developing countries for a ten-year period. The foHowing groups 
af countries are excluded from the generaUzed system af preferences: 


of production and margin of profits. J. S. S h e r s h n i e v, SShA: tamoshennyj p1'O- 
tekcionism, Moskva. 1970 [USA: customs protectionism], p. 62-63.
>>>
10 


Janusz Gilas 


a) aU communist countries, except those which receive MFN treatment, 
are members ofthe GATT and IMF and are not dominated by the inter- 
national communism, b) countries which are members of OPEC, c) coun- 
tries whichexpropriated the property oI the U.S. national without pro- 
mpt adequate and effective compensation, d) countries which had not ta 
ken adequate steps to cooperate with the United States to prevent nar- 
cotics and other controlled substances from unlawfully entering the 
United States, e) countries using system of reverse preferences. and 
f) eountries which do not recognize arbitral awards. 
The United States is the greatest agricultural products eX'porter in 
the world. The, problem wa
 regulated in Agricultural Trade Development 
an.d Assistance Act of 1954. 11 The aims of the Act wete follbwing: expans- 
iOńs of international trade and of export markets for Umted States agri- 
cultural commodities and use the abundant agricultural productivity of 
the United States to combat hunger and malnutruition and to encourage 
economic development in the developing countries. 12 Under the provisions 
of the Act the President ha!? the authority to negot:iate and car'I'Y out 
agreements with friendly countries to provide for the sale of agl'icultural 
commodities for dollars on credit terrD.S 0'1' for foreign currencies. For the 
purpose of credit the Commodity Credit Col'poration was established. 
However this Act is administered not on unprofitable and charitable basis 
but as an instrument of generai foreign policy and agreements are nego- 
tiated and credit is given to the "f,riendly countries to help themselves 
towaro a greater degree of self-l'eliance, inc1uding effoiI"ts to meet their 
problem s of food production and population growth".ł 3 


INTERNATIONAL AGREEMENTS ON INTERNATIONAL TRADE BINDING THE 
UNITED ST A TES 


According to article VI, point 2 of the United Statels Con:stitution the 
treaties "shall be the Supreme Law of the Land". It is interpreted as 
a guarantee of the supe!l'iority of the treaties oyer State law but the 
doctrine assures that aocording to the maxim lex posterior de!l'ogat legt 
priori a federal treaty does not enjoy any supremacy in its domestic 
applicatlon over subsequent inconsistent federal legislation. 14 In the field 


11 Public Law 480, many times amended, last time on 10 August, 1973. 
12 Sec. 2. 
18 Sec. 103, a. 
14 P. H a y, An lntroduction to the United States Law, Amsterdam-New 
York-'Oxford 1976, North
Holland Publishing Company, p. 3. The problem is also 
discussed by W. S z y s z k o w s k i,. Traktaty a prawo wewnętrzne w systemie praw-
>>>
Legal Instruments for the United States Foreign Trade 


11 


of foreign trade the review of the substance of the treaties made it elear 
that the treaties are instrument s led by the provisions of the United Sta- 
tes statutory law concerning foreign trade. That is evident also in the 
position of GATT in the United States law, the participation in which 
was only accepted by Congress after 26 years of membership. 
The most important international treaty affecting foreign trade of the 
United States is generał agreement on tariffs, and trade of 1947, which 
entered into force for the United States on January 1, 1948. It provides 
basis for the foreign trade with every other member state, only Czecho- 
slovakia is excluded toward which the United States suspended its 
'Jbligations on September 29, 1951.1 5 GATT provłdes general multilateral 
most-favoured-nation treatment and intends to suspend tariff and non- 
Łariff ,trade barriers, under which provisions rounds of negotiations, as 
Kennedy round Ol' Tokyo round had taken place. The philosophy of 
GATT is that of free trade and that is why International MonetaryFund 
is so important, because it assures free exchangibility of money. The 
United States is member of the founding instrument whrich is effective 
for this country from December 27, 1945.1 6 This international agreement 
introduced exchange stability and intended to eliminate money barriers. 
After revision this agreement for the stabilization of money liquidity 
established special drawing rights. In implementation of Artic1e V of the 
GATT there was adopted international antidumping code, which was 
negotiated at Geneva on June 30, 1967 and entered into force for the 
United States on July 1, 1968.17 In tbis instrument thell'e was contained 
determination of dumping, determination of, material injury, threat of 
materiał injury and material retardation and adopted investigation and 
administration procedur es dealing with the coHection of anti-dumping 
duties. 
Nowadays, international agreements on raw materials have become 
more and more important. The United States is a party to most important 
raw materials instruments founding particułar international organizations 
and regulating the markets foll' particular raw material and its substitutes. 
The most prominent instrument s of the regulation of international market 
for singular raw material are floor and ceiling prices and buffer stoeks. 
The United States is a member of the International Coff.ee Organization 


nym Stanów Zjednoczo,,!-ych Ameryki Północnej [International Agreements and Mu- 
nicipa1 Law in thę United States], Toruń 1964, p. 134-135. 
15 Text: Legislation on Foreign Relations with Explanatory Notes. Committee 
on Foreign Affairs. U.S. House of Representatives. Committee on Foreign Relations. 
United States Senat e, Washington 1974, p. 1536-1593. 
1e Ibid., p. 775 ff. 
17 Ibid., p. 1601 ff.
>>>
12 


Janusz Gilas 


as m'0st impartant importing member,18 International C'0tt'0n Advis'0ry 
Committee;19 Internati'0nal Lead and Zinc Study Group,20 Internati'0nal 
Rice Commission,21 International Rubber Study Group,22 International 
Wheat Council in which posseses 280 votes of exporting members for 
1000 vótes in general,23 and Internati'0nal Wool Study Group.24 Uniortuna- 
tely, although the place was reserved for the United States it ts not 
a member af such important organizations in the field of raw materials 
as International Sugar Organization and International Tin Council. 
The important element oi the foreign 1Jrade structure of the United 
States are food and agricultural trade agreements. ,The number of these 
agreements is very high. It was examiued that only during five years 
peri'0d beginning with 1963 as many as 480 agreements were c'0ncluded. 
Some of them were conc1uded in contradiction to the FAO principles of 
"unrestr'icted tied sales", by whidh was meant that food aid is made 
contingent upon a given level '0f commercial imports from the don Ol' not 
limited t'0 the normai imports from the supplying country and with'0ut 
pr'0vision for safeguarding the norma l commercial trade of other export- 
ing countries. However tied agreements were concluded, the number of 
them in the United States practice mounted from 12 to 18 annually. One 
must stress that over two-thirds of tied agreements involved vegetable 
oils, cotton and tobacco which have no direct influence on food aid 
programmes. 25 
On the other hand the United States negotiated import agreements 
with many countries for textile and meat. These agreements were con- 
cluded for one year period and stabilized markets for these goods by 
providing export oountries with annual quotas. The ex ample of this sO'rt 
agreement can be found in exchange of notes between Costa Rica and the 
United States of 1 and 11 March 1971.2 6 


18 A. J. P e a s l e e, InternationaZ GovernmentaZ Organizations. ConstitutionaZ 
Documents, rev. third edition, Part II, The Hague 1975, p. 167 ff. 
l' Ibid., p. 243. 
20 Ibid., p. 290-291. 
11 Ibid., p. 359. 
22 Ibid., p. 367 ff. 
u Ibid., p. 452 ff. 
u Ibid., p. 538 fi. 
n R. L. B a r d, Food Aid and IntternationaZ AgricuZturaZ Trade. A StUdy in 
Legal and Administrative Control, Toronto 1972, Lex:ington Books p. 215. Su ch 
agreement was concluded for instance between the USA and Lebanon 'on 11 June 
1970 (UNTS 1971, v: 763, no 1(908). 
28 UNTS 1971, v. 800, no 11397. The most important article 2 stated that the 
government of Costa Rica "will limit ex:ports of the aforementioned meats so that 
the quantity of such orignating in Costa Rica and dUl'ing the calendar year 1971
>>>
Legal Instruments for the United States Foreign Trade 


13 


In the treaty practice of the United States the most important are 
natura11y trade and navigation treaties. This instrument lost its value in 
the relations between the United States and many capitalist count!l'ies, 
because they are members oi the integration .structures, but maintained 
its important character in relations between the United States and the 
developing countries and in the relations with some of the sodalist 
countries. It provides MFN daUise in a11 matteI"ls oi trade, customs, navi- 
gation and the settlement of aliens. Aceording to the provisions of the 
treaty conc1uded between the United States and Chinese Republic of 
November 4, 1946 the treatment of aliens, both natural persons and jU!Ti- 
dical persons was foundęd on national clause. It stated that in the matters 
of navigation there was guaranteed right of access far national ships 
with cargo ta a11 ports opened for internatianal navigation, right for 
treatmentin matters of port duties and customs duties, formalities and 
navigation documents, towing and pilotage according to national standard, 
and the right of loading and unloading export and import cargoes was 
also p!Tovided. 27 


LEGAL INSTRUMENTS FOR TRADE RELATIONS BETWEEN THE 
UNITED STATES AND THE SOCIALIST COUNTRIES 


Mter the secQnd world war the trade relationsbetween the United 
States and the sodalist countTies were limited under emergency export 
controllegislation. In 1949 Congress passed the Export Control Act, which 
gave to the President the right to postpone foreign trade with the socialist 
oountries on the ground of national sec\Jrity of the United States. This 
Act was extended periodically and governed the foreign tradeof the 
United States for two decades. Thils legislation inf1uenced highly the 
foreign trade policy of the allies of the United States and under the 
Mutual Assistance Cantrol Act of 1951, known 
s the Battle Act pcr:-actice 
of embargo for 50 called strategic commodities was adopted by Western 
countries toward the sodalist states. 28 


entered or withdrawn from warehouse for consumption in the United States do es 
not exceed 31.1 milion pounds or such higher figu:re as may result trom adjust- 
ments pursuant to 
 4". 
27 Text: American Journal of International Law, 1949, v. 43, Suppl. ott. Doc., 
p. Z7 ff. Commentary on the United States trade and navigation treaties see J. G i- 
I a s, Prawne problemy rynku międzynarodowego. Zarys problematyki prawa pu- 
bticznego [The Legal Problems ot thę International Market. Outline of the Public 
Law Problems], Warsaw 1975, p. 94-99. 
28 A. P. P a r s o n s, Recent Developments in East- West Trade: The U.S. Perspec- 
tive, [in:] East- West Trade, 00. by K. G r z y b o w s k i, Leiden 1973, A. W. Sijthoff, 
p. 159.
>>>
14 


Janusz Gilas 


The United States polłcy of embargQ on tracie with the sQcialist caunt- 
ries dld nQt pastpQne the industrial develQpment af these countries and 
that was the reason why it was terminated in late sixties. 29 The change 
of the palicy of the United States was seen in the Expocrt Administratian 
Act af 1969, which dec1ared that it is in the interests of this cauntTY "tQ 
encaurage trade. with all countrie:s", however the President had the 
privilege to supress the fareign trade "which wauld make a significant 
cQntribution ta the military patential of any natiQn" 01' which "prave 
detrimental to the national security". However this does nat mean that 
restrictive practices toward impart caming from the socialist countries 
were terminated. AIsa because ai payments reasons it was necessary to 
take into consideratian that internatianal trade can nat be treated as one 
way street, e.g. bath expart and import interests af the sacialist countries 
in the same mament should be taken inta consideration. This point af 
view was taken lnto accaunt by Miller Committee appainted in 1965 and 
subsequent1y praposed by the administration in the East-West T:rade 
Relatians Act af 1966 and Recipracal Trade Agreements Act introduced 
in the Senate in 1968. Unfartunately this proposaIs became abolished. 30 
The major change ai the foreign trade policy ai the United States was 
promated in the proposed Tracie Reform Act .ai 1973 and negatiated 
between the United States and the Saviet UniOltl in series of bilateraI 
trade agreements. The Trade Reforms Act of 1973 prapased ta extend the 
mast favaured c1ause taward Saviet trade and ather cammunist countries 
(with exception ai Yaugaslavia and Poland which received such treatment 
befare). The pravisiQn af the prapQsed Act meant lifting af the trade 
barriers, especially custams and taxbal'riers which under former condi- 
Hans made U.S. market unaccessible far the Soviet goods. On the ather 
hand United States-Soviet Union 1972 agreements camprised agreement 
on principles, settlement af American claims from the lend-lease agre- 
ement, trade and maritime agreements. These agreements w€re drafted 
on MFNclause basis and they farmed lIITutual fareign trade structur€ 
cQnsisting of cammercial cammission, Soviet trade representatian in 
Washington and U.S. Commercial Office in Mascaw and at last trade 
organizations which had the right under agreement and internal law af 
bath cauntries to make cantracts and handle cammercial transactions. 31 


29 In 1954 there was one-third reduction in the number of items under embargo 
but the United States maintained more extensive list than its allies. The United Sta- 
tes Role in East-West Trade. Problems and Prospects, Washington 1978, The U.S. 
Department of Commerce. 
ao Ibid., p. A-6. 
31 K. G r z y b o w s k i, United States-Soviet Union Trade Agreement of 1972, 
[in:] East-West..., p. 3-12.
>>>
Legal Instruments for the United States Foreign Trade 


15 


The Tracie Reform Act 1973 was passed by Congress, but aforementioned 
agreements were blocked by palitical reservatians and the linrkage policy 
of emigration prablems and foreign trade because it was not possible for 
the Soviet Unian ta praceed with the agreements 'On the c'onditians pul 
into the Trade Act of 1974. 32 TiUe IV af the Act provided that na country 
cauld receive undiscriminatory treatment if the President discovers that 
such country denies its citizens the right Ol' oppartunity to emigrate ar 
imposes mOTe than nominal tax 'On emigratian ar on the visas ar on otherr 
'documents require9 for emigratian ar athercharge on any citizenas 
a cansequence of the desire of such a citizen to emigrate to thecauntry 
of his choice. However, agreements between the governments of the 
United States and the Soviet Unian 'On the supply oi grain and oil trade 
between the aiarementianed countries were cancluded and were executed, 
because they were so called executive agreements, and as such no. con
 
gressional action was required to bring the agreements inta force and no 
legislatiorn was necessary to implement their provisions. 33 There was also 
signed on June 29, 1974 between the Soviet Union and the United States 
long-term agreement to facilitate economic, industrial and technical co- 
operation, which became valid. 
However one must admit that some of the socialist countries obtained 
MFN claU'se from the Untted States both on internal U.S. basis and in the 
framework of multilateralagreements, especially general agreement on 
tariffs and tracie. To these sacialist countries belang Yougoslavia, Poland, 
Roumania and Hungary.34 Poland had MFN clause in the United SUites 
as result of trade treatyconcluded during the pre-war period but it was 
uni1aterally terminated by the United States in 1951. Though on tempar- 
ary basis uni1aterally this clause was extended on Poland in 1960 but the 
range of it depended on the United States. 35 That is why MFN claulSe 
contained in the GATT walS 80 valuable because it extended on aU foreign 
transactians with other members the privileges guaranteed under inter- 


III! J. T. U s i e n k o, Riezhim najbolszogo blagoprijatsvovanija w sovietsko-ame- 
rikanskih torgovykh otnoshenijach [Regime of the most-favoured treatment in the 
Soviet-American 'Trade Relations], Sovietskoje Gosudarstvo i Pravo, 9/1974, p. 84-91. 
83 Texts and discussion: United States Grain and Oil Agreements with the 
Soviet Union, Hearing before the Committee on International Relations. House of 
Representatives. Ninety-Fourth C
ngress. First Session, October 28, 1975, U.S., 
Washington 1975, Government Printing OUice, p. 71. 
34 The Secretary of Commerce Rogers Morton stated in The United States in 
East-West TraCie, p. C-14: "In the case of Hungary, the la ck of MFN has a direct 
impact on our ability to export because that country has a tariff which levies a duty 
rate on commodities of U.S. origin which is twice that applied to the goods of other 
western nations". 
35 It was given to Poland in 1960 and concerned tariff treatment.
>>>
16 


Janusz Gllas 


natianal agreements between member cauntries and prohibited restrietive 
practices and barriers, both tarif and nontariff. 36 There are also binding 
the United States and some European socialist cauntries agreements on 
econamic, industrial and technalogieal cooperation. Such agreements were 
eonc1uded with Roumania in 1973, a's well as 'On April 2, 1975 ,another 
agreement 'On trade. 
In fO!I"eign trade relatians with the sodalist countries there was apra- 
blem on the si de af the United States af the state immunity. This questian 
was an abject af many U.S. caurts jugments and from 1976 was regulated 
by FO'reign Savereign Immunities Act. 37 Accordingly to thes act eommer- 
cial activity af the State is cavered by the pravisians dealing with the 
general exceptions ta the jurisdictional immunity of a fareign state. 38 In 

 1605, a, there was stated that: 


A foreign state shall not be immune from the jurisdiction of courts of the United 
States 01' of the States in any case [...] :;!) in which the action is based upon a com- 
merdal activity carried on in the United States by the foreign state; or upon an act 
performed in the United States in connection with a commercial activity of the 
foreign state elsewhere; or upon an act outside the territory of the United States in 
connection with a commercial activity of the foreign state elsewhere and that act 
causes a direct effect in the United States. 


This solution adopted in the Aet however cauld not be regarded as an 
. obstac1e to the fal'eign tradewith the socialist eountries, because only the 
state enterprises enter into c'Ontracts with the United States naturalor 
juridical persons and they can be sued and be subjeets ta civil responsibi- 
lity to the extent of their property. 


CONCLUSIONS 


The position of the United States in foreign trade is unique in inter- 
national' seale. It means that the United States relatively are not much 
invalved in the internatianal structure af agreements. It is seen espeeially 
in the field af international trade and navigation treaties which are nat 
50 populall' in the United States fareign practice as in the practice af other 
cóuntries. Other treaty instruments, as far instance food aid and agricul- 
tural trade agreements'and import agreements on textiles OT meat belong 
to traite-oontmt type of rinternat'ianal agreement, because they can be 
regarded as instruments of the regulation of demand and supply. The 
agreements creating internatianal ecanomic organizatians did nat in- 


II J. Wotnowski, Polska w GATT [Poland in GATT], Warsaw 1974, p. 60-67. 
.1 Public Law 94-583, 94th Congress. Text published in the: American Journal 
of International Law, 3/1977, v. 71, p. 595-601. 
aa ł 1605, a, 2 of the aforementioned.
>>>
Legal Instruments for the U'nited States Foreign Trade 


17 


f1uence the United States policy in many respects. The most characteristic 
is that sa important international economic agreement as GATT was for 
; two decades noticedby the statutory law of the United States. In such 
situation the United States is the only country which regulates its foreign 
trade mainly through instrument s of the statutory law. The impTession 
of this paper is that the international agreements only fm gaps in internal 
ins1Jruments of the foreign P9licy of the United States and can be regarded 
as supplementary ones. In the light of the aforementioned observations it 
is evident that the foreign trade policy of the United States is not based 
on the Ifree trade doctrine as is assured by economists and politlicians but 
is powerfully protectionist. The legal tools of this policy were mastered 
as powerful inst1ruments of the general foreign policy of this country.
>>>
ACTA UNIVERSITATIS NICOLAI COPERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 106 - 1979 


DepaTtment ot Financial Law 


Jan Gluchowski 


ORIGINS RANGE AND ESTIMATE OF OIL TAX PREFERENCES 
IN -THE U.S. 


C o n t e n t: OH preferences and a.'l outline of their development Possibilities 
of lobby influence on the legislative process. Arguments of oil .industry supporters 
in the lT.S. Congress. Counterarguments. The reasons for the enactment of oU pre- 
ferences by Congress. Concluding remarks. 


OIL TAX PREFĘRENCES AND AN OUTLINE OF THEIR DEVELOPMENT 


The definition of ,a tax preference is not a simple matter becau:se those 
profiting f Tom them treat preferences as an equali:zation of their parti- 
cular tax situation in relation to. the TeSt oi tax payers. One could well 
gather that SP,€'Cial tax legislation exists exc1usively owing to the ipresenC€ 
of particular cireumstances in the tax payers situation. One CRn aIso say 
that speciallegi'slation is !Buch that it enables one to legallyavoid paying 
the łull amount of taxes one owes. 
Theocetically the whole tax 'should be impooed on the total income of 
a tax payer. A non-privileged tax payer is the person who will pay the 
tax on every donar of his income. 1 
In American practice the mining industry particulary profits from tax 
preferences and within its frame"vork the oil industry as well. The 
existing situation is brought about by a -powerful oH lobby acting at the 
Congressional forum. 
Lobbying refers to the activity which QCCurs in Congressionsl COT- 
ridors. The practice of a group mf1uencing parliamentarians with the aia 
of rpeo:nament representatives acting in the corridol'iS is specifically Ame- 


1 B l u m, The Effects ot Special PTovisions in the Income TaxpayeTs MOTale, 
Joint Committee on Economic Report, [in:] FedeTal Tax Policy fOT Economic G.rowth 
and Stability, Washington D.C. 1955, p. 251. .
>>>
20 


Jan Głuchowski 


rican, and therefore its definition cannot be applied to English or West- 
-Euro.pean condi t!i.OllS. 2 
Professionallobying in the U.S. dates to the times of Andrew Jackson. 
The development of lobbying mainly took place in state legislatures from 
where it was transfer red to Washington. The term "lobby" in its practical 
meaning started in 1829, and it was used in the expression, "lobby agent", 
refering to a hi red employee who was a guest in the legislative halls of 
Albany New York. 3 
The mass development oi lobbyiin:g, nevertheless, came at alater 
pe!l'iod duriIng ,the year,s of Tailway construct1on. Miler and Cochran use 
as an example the factts concerning competition among railway,s in the 
. Wi.sconsin area in 1856. There one railroad C'Ould get the right to a milion 
acre,s oi land for $900,000 if it were distributed among the "proper 
people". The necessaTy distribution was as :£ollows: 59assembly memberts 
$355,000, 13 senatons $175,000, governor Coles Bashfo:rd $50,000, the other 
repa-esentatives of state authorilties inc1udingasupreme court judge 
$50,000 and to the IpeT'sonal seoretaryof thegovernor $5,00Q. The rest ot 
this amount was distributed among lohbyists and their aides In return for 
well-completed mi:ssion lin the halls of thestate legisla'ture in Madi i son. 4 
Practicies oi thiskind become sa popular that in order to cut them 
down, stałe .regula1tion,s 1imiting ldbbying were passed.. They were often 
included in 'state cOiD:stitUtions the earliest in New Hempshire (1792), 
Vermont (1793), Rh
de I'sland (1842). These resolu.tioI1lS bore thesame 
general chara'cter. More precise and 1,imiting regulations We!l'e icluded in 
, the Comtitution of Alabama in 1873 and in Georgia in 1877. In the l'atter 
one, the term. "Lobbying" was U'sed for the first time. 5 
The majorityof the minig firms also bad the possibility of double OJ' 
extra dool.lctions frOiID tbe Ibasic taxation of their g;ross income. The 
adhe!l'ence to thi,s group washighly renumerative. 6 
The begirnning oi this ipreferential tu treatment dates back to 1913 
when Congress approved the law of the cost deauction. On the basis orf 
these early pTivileges oWlI1e
 
f an oi! wells could deduct dUTing one 
yea:!, trom their basic income tax a percootage of bis propei'ty. Tms patti- 


2 S. E h r l i c h, Wladza i interesy, Warszawa 1973, p. 50. See also S. E. F i n n e r, 
The Anonymus Empire (A Study of Lobbying in Great Britain), London 1958 and 
A. S a u r y, Lobby's et Groupes de Pression [in:] Le,Povoir, part I, Paris 1957, p. 17. 
a E, L a n e, LObbying and the Law, Berkeley and Los Angeles 1964, p. 19. 
.. The Age ot Enterprise, New York 1947, p. 81. 
s E. L a n e, op. cit., p. 27. 
'The Role of Taxation in Providing for Depletion ot Mineral Reserves, House 
Ccrmmittee on Ways and Means, [in:] 2Tax Revision Compendium, WashingtonD.C. 
1959, p. 968. '
>>>
Origins Range and Estimate of OH Tax Preferences in the U.S. 21 


cular tax preference developed in 1916 and it utilized the market vaIue 
of the property in 1913 aiS the basis for deductioTIisfrom the amount 
subject to taxation. This ad favored the interes:ted people because the 
market value of theiT fortune icreased c011lsiderably ovelI' a few years. 
In order to improve the existing situation in 1924 a 50% tax reduction 
from yearly net income wa's introduced. In 1926 the percentagetax :reduc- 
tion was replaced by a "discovery reduction" resulting £rom the dif... 
fłicuHiesin defining the market value of objects. Instead of the current 
privileges the owne
s of oH wells were allowed a 27.5"/0 deduction from 
gross income earmed. It was a:ssumed. that this deciudion would not exceed 
500/0 of the net income. In this way the privileges of the oil indU!Stry weQ"e 
doubled. 7 


POSSIBILITIES OF LOBBYING INFLUENCE ON THE LEGlSLATIVE PROCESS 


In connection wd.th,tax laws the q1iestion arilses ,as to which matters 
should be regulated by the Depa
ment of Tlrea'sury. Partlythis resuIts 
f'rom the departmerrts range of a,bilities. Cong!l'ess decides a'bout the basic 
assumptions but the DepaT'tment of Treasury ais an adminis:trative organ 
has at its disposalspedalized agendes farriiliar witn tax problems. 8 
The project can gain approval afteT being passed by the House of 
Representatives, but the draft is prepared by the Government and more 
p!l'operly by the DepaTtment of Ttreasury. The staff dealing with tax legis:" 
lation 15 made up of 30 economists and ,statisticians gathered in the Office I 
of Tax Analysis, and about 20tax lawyers and accountants advilS9res 
employed by the Officeof the Tax LegisIative Counci1. 9 Furthermore, it 
is possible to get help from the Council of Economic AdvisO!l's and the 
Office of Management and Budget. 
The tax proposals are referred to the House Ways and Means Com- 
mittee 10 which conducts hea:rings COII1cerning proposed laws. The SeclI'eta'l'y 
of the Treasury is traditionally the first witness representing in principle 
the public itnterest. ll These hearings are used at large by lobbyists repre- 
senting the intelI'ests 0If different g!l'oups which are trying to gam fiscal 
privlleges f Tom the Iegislato:rs. 


7. The allowed torelable cut for other branches of mining industry was set at 
a different level - 23% for sulphut, 5% for coal, 15% for metalores. These pri- , 
vileges were extended in 1954. ' 
8 N o t e, Toward New Modes oj Tax Decision Making the Debt Equity ImbrogZio 
and DisZocations in Tax Lawmaking ResponsibiZity, Harvard Law Review, 83/1970, 
p. 1710. 
· J. p e c h m a n, FederaZ Tax Policy, New York 1971, p. 34. 
10 The Ways and Means Committee came into being in 1802. 
11 N o t e, op. cit., p. 17H.
>>>
22 


,Jan Głuchowski 


Mter thehearings are over, the House Ways and Means Committee 
together with the other governmental hodies 12 presents a compromise draft 
whieh takes into coIllSideration the different points of view. Tha members 
of the Ways and Means Committee try to avoid the ove[' lappi:ng of 
hearing,s. Futhexmore the debat e over the tax legisla tion in the House of 
Representatives ils limited in time which precludes the poss
bi1ity of any 
corrections. A typical example may be thebill On tax reform in 1969 
whose text reached 631 pages. Altogether thts aet was discussed fur 6 
hours without introducing any correctioniS. 13 
The projected dra f t oi a normative act after being approved i's sent to 
the Senate where it ts presented to the Committee on Finance. The debate 
in the Senate developes as in the House of Representatives. The main 
difference lies in the faet that the Senate detbate ove!!' the proposal ]S no1 
Hmited. 
The basie principles of tax policy are formulated in the Senate. 
FurtheTmoTe asolution was evolved to the problem ofhQW to resolve the 
di:ffeTences betweex the Houseand Senate version of the !Same bill. Mem- 
beI'ls of the eommittees oi the two houses meet directly in ordeT to define 
the compromise text. 14 Their discussion concentrates primaTHy on second 
rate technical problems connected with the bill. 
The pressure groups empha.si:ze the faet that rtheir spokesmenset forth 
materia1s with Congress and state legislature commtssions and different 
advisory commirttees which have the appearence oi abjectivity. They aLso 
try to give the impression that thelir considerstion:s lies in the public 
interest. One author analizing this problem states that, 


...a great number of advisory bodies. without which [...] no modern administra- 
tion can function, imposes on pressure groups a new style of action, leading to the 
necessity of using sense argumentation in the defence of a considerable 'interest. 15 


In the U.S. taxes are imposed by local, state and federal govem- 
ments. 16 The passing of tax bills takes place in Congress 17 as well as in 
:state legislative organs. Thesupportes of the oH industry do not hesi ta,te 


12 Joint Committee on Internal Revenue Taxation, Representatives of the Tre- 
asury and The House Legislative Consuel. 
11 N o t e, op. cit., p. 1711. 
14 S. S. S u r r e y, Tax Incentives as a Device for Implementing Government 
Policy: a Comperison with Direct Government Expenditures, Harvard Law Review, 
83/1970, p. 176-177. 
1& S. E h r l i c h, op. cit., p. 360-361. 
18 J. G ł u c h o w s k i, Federalny system podatkowy Stanów Zjednoczonych, War- 
szawa-Poznań-Toruń 1975, p. 6-7. 
17 C. W. M i 11 s, Elita władzy, Warszawa 1961, p. 382-383.
>>>
Origins Range and Estimate of OH Tax Preferences in the U.S. 23 


to put pressure on local legilslative organ.:s. In the CaJifurnia state capitol 
in Sacramento duri'ng a Senate debate several oilindustry workers showed 
up to the hearing room wearing overalls. They triedtoSitop a tax hike. 
The tax hike would potentially ibring about unemployment for oi! well 
workers. Together with the workeI'ls the corporation president took the 
floor in oroer to "soften UIp" the guys, e.g. to ini1uence the senators to 
keep the present tax leve1. 18 
The general proceedure of enacting tax laws makes one think that 
experts take a pa'lticular place in the formation of tax leg:islatien.1 9 At 
every stage, exceptin the Senate, there is a oonJstant confidence in the 
Department of Treasury staff and Joint Committee. 20 In this case one 
speaks aboui the autornatism of authOrIzation 21 which falls on tax speda- 
lists. Their independence and soveregnity will increalse as the tax regula- 
tions become more c:omplicated. Studying this situation from the point of 
view of the taxpayer draws attention to the fact that bigger and bigger 
sums will be paid fol' special tax services. 22 


ARGUMENTS OF OIL INDUSTRY SUPPORTERS IN THE U.S. CONGRESS 


One of the longest exposespeeches in the Congress On behalf of tax 
preferences was the 'speechof Sun Oil Cottlpany pa:esident R. G. Dunlop 
befO'l'e the Senate Finance Cottlmittee. 23 His statement was presented as 
an expres:sion of the vieWis of the majori:ty of the rep!l'esentatives of the 
oH industTY concerning a bill on tax reform. 
His view was tax cuts facilitated investments and consequent1y new 
oH and gas deposi1Js were struck. This contributed to technological advan- 
cement and furthermore it made possibile di'illings at great depths. In 1939 
one mined maximally at the depth of 9,200 feet, in the late sixties the 
depth increased to 25,000 feet. Modern technology enabled the exploita- 
tion of oH from sea and ocean beds, and allowed for the continuation oI 


18 D. A n d e r s o n, Californi« State Government, Stanford 1941, p. 176. See also 
S. E h r l i c h, op. cit., p. 359. 
10 N o t e, op. cit., p. 1712. 
10 Joint Committee included The House Committee on Ways and Means and 
Senate Finance Committee. 
21 N o t e, op. cit., p. 1713. 
II Effects of Depreciation AHowances for Ta.x Purposes, House Commit
e on 
Ways and Means, [in:] 2 Tax Revision..., Washington D.C. 1959, p. 799. 
28 Statement of Robert C. Dunlop (President, Sun on Company) in: Hearings 
on Tax Reform Act of 1969 before the Senate Finance Committee, 91-st Congress, 
1-st Session, pt. 5, Washington D.C. 1969, p. 4455--4465.
>>>
24 


Jan Głuchowskl 


resource exploitati'On which formely weredec1ared as non-profitable. 24 
Technol'Ogy thus d'Oubled reserye deposits. 
The Department of Interior stated that oH 1S the source of 3/4 of .alI 
used e1łergy. It is the ba:sis f 0'1' horne heatinga:nd secondly as a raw mate- 
rial in different hranches of industTy. M'Odern society oouldnot exist 
without ,'OH and natural ga,s. The t'echrnical rev'Olutio
 can be defined as 
energy revolution. The replacement 'Of power by machinesenabled the 
quick inC!l'earse 'Of producti'On. The relati'O!l}.ship between income and energy 
c'Onsumpti'On is cOOracteTistic of m'Odern times. 
The keyargument 'Oi l'Obbyists irs the statement that wit!łl'OUt oil the 
armed forces would be useless. In spite 'Of the devel'Opmenrt of nuclear 
weapons, conventi'Onal warfare dorninates at the present timeand it will 
continue t'O da 80 in the future. That i's why 'OH will decide national securli.- 
ty. The oH used per 'soMier in 1968 is double the am'Ount used during the 
Second WaT. The' Department of Defence stated the'ref'Ore ,that oH plays 
the main r'Ole in :the defensive security'Of the U.S. 
The pTesident of Sun OH Companybef'Ore the Senate Finatr1ce Com- 
mittee stated tOOt American 'Oil reserve'S are deereasing. The excepti'On is 
the Alaiska territory. Theexpl'Oitati'On cost in AlaJska are a few times higher 
than the 'OH reserves situated at c10ser range. The simplest and the 
cheapest techn'Ol'Ogical improvements havealready been' introduced. 
Further progress will be more expensive and c'Omplicated. The 'OH rese,r- 
ves outside the U.S. are to be found ffiainly in the Middle East and North 
Airica (U.S.S.R. is n'Ot included). Their deposits are as follows: 
Persian Gulf C'Ountries 75% 
North African Countries 11 % 
Venezuela 4°/0 
Indonesia 3% 
Other c'Ountries 7% 
Source': Organization of Petroleum Exporting Countries. 
The American oH c'Ompanies operating abroad oflten meet difficulties. 
Economic factor:s may cause the halt 'Of investments in 'Other countries. 
There i,s intense nard international competition wm.ch in Dunlop's view 
particularly requi!l'es not 'Only the continuance of tax priwegesbutalso 
their expansi'On. 25 A 'tax incTease by with a lSimultane'Ous lack of recOIn- 
p€nJsation will influence profit:s, inve:stments 'Ol' pTilces. The decrealse 'Of 
profits ,and investments cormected with the sea
h f'Or re.sources must 
take place. A regressive effect might wen also take place. Gasoline 
expenses are the highest f'Or the lowes:t lincome groups. 


24 ,Ibid., p. 4459. 
15 Ibid., p. 4462.
>>>
Origins Range and Estimate of Oil Tax Preferences in the U.S. 25 


The lowest income group below $3,000 a year Uised to spend 6.2 cent:s 
on every dollar spent on gas. The same index in the imcome group of 
more than $15,000 amouted to 1.5 cent. A gas price imcrease woul have ' 
a greater effect O!ll the lower income workers. The federal goVernment, 
which ils the most importamt unitaTY Ulser ofoil products would also have 
to assign additional sums for lits purchase. 
The abolishment of fiscal privileges woul ca.use the stop of geological 
oH. searches and drilling-3. Dunlop also stated ihat the inte!l'est of oH 
imdustry lias in the discovery of oil in the U.S. Otherwise theU.S. can 'be 
imcreasirrtgly dependent on fmeign impO'rts. Because of the lac1
 of con- 
trol im theseventies, orne can forcast the folIowing percentages ()foił 
cornpanies dependance on foriegn grude oil: 
Cities Service 68 
Gulf 54 
Rumbie 49 
Marathon 61 
Phillips 57 
Sohio 54 


Source: Cabinet Task Force on OH Import Control, 1960. 
\ 
Owing to the tax policy ónecould aiI'gue that reasonable prices should 
be paid by theconsumer. From 1957 to 1969 the index of oH prices in- 
creased 50/0, while the index for ot11er goods increased 13 ft lo. The gasoline 
prices excluding direct taxes increased from 1926 10 0 /0 a gallom. The con- 
sumptionprice index doubled since that tirne. 
Among other results coming from legally guaranteed tax privileges, 
the president of Sun on Company enumerated: 
-- the improvement of the U.S. balance ofpayments, 
_ inCTeased Arnedcan incomes from foreign oH investments,26 
_ development of ail'l infra-'structure connected with the oH industry, 
particulary in transportation and communication, 
- fulI exploatation oi :resources. 27 
Dunlop sees two alternatives, fi!l'st to develop a ValSt American own ed 
oH industry which will meet basic home needs. That is why ome must 
introduce s:pecial tax legislation. Secondly, the use of ioreign imports 
becomes inevitably dependent. 28 


, 
16 Dimensions and geographical disposition of direct investments in the U.S. in 
oiI industry are extensively presented in the paper by S. M i e n s h y k o v, MonopoZe 
Amerykańskie na światowym rynku kapitalistycznym, Warszawa 1959, p. 173--180. 
17 Statement of Robert C. Dunlop..., p. 4460. 
18 Ibid., p. 4456-4457.
>>>
26 


.Jan Głuchowski 


COUNTERARGUMENTS 


The oil industry lobbyists think that tax tprefetences are necessary !in 
order to encourage the owners of the petro-:hemical industry to under- 
take geological searches. Howev er , H8Irberger pointed out that owing to 
the tax law privileges, oH companies a,re ready to spend $2.12 in order to 
gain $1.00. 29 These figures point out how far it oou1d be profitable to 
i:ncurr exploration expense.s aocording to the obliging tax law!regulations. 
Over-used is ofte.n the argument about the relation oi the profitable 
and nonprofitable oil wells (1: 10). The available example from 1958 
points out that 40 of t11e most important companies having at their 
disporsal 48,700 weHs of which 60 6 /0 were initially COTirectly located. 
This data oonstitutes an argument against fiscal privileges. The big 
firms do not need them because they are in a good economic situation 
and their wellrs are the most profitable. 
The non-corporated firms find themselves in a worse situation. They 
are subject to a bigger risk. They drill mor e unp:mfitable wells, but the 
AmeriCian tax payer pays for the activities of both them. 
Special tax legislation is justified by the lobbyists becouse of necessity. 
of :reserve creations f'Or future needs. In one of the CongreSlS committees 
it was stated that it results from two doubtful assumptions. 30 
1. Oil as an energy source will play the same role in the future as 
in the present. 
2. The rprice mechanism does not function in oil industry and therefore 
one must give this branch of the economy privileges. 
The second argument ilS more important. Ii the price s)'lstem doesn't 
worksatisfactorily, the goveTnment has at its disposal twotraditional 
solutions - it can introduce new regula'tions or take over the industry 
as in the case of the poStal service. Perhaps the oil industry cannot cover 
its mediumexpenses over a long period of time and therefore there must 
be government intervention at least in the form Oil Import Admini- 
strat,ion. Mange neverthless doubts ii it is a true picture of the competitive 
industry.31 
Eve!rything points to the fact that the oil industry without privileges 
could eificiently oompete in the market and mee1 the demand .for its 
products. The representatives of this industry, tpresenting its immense 


SD A. C. H a r b e r g er" Testimony bejore' the Joint Committee on the Economic 
Report, Federal Tax Policy for Economic Growth and Stability Papers, p. 439-449. 
80 M e n g e, The Role oj Taxation in Providing for Detletion of Mineral Reserves, 
Washington D.C. 1959; p. 974. 
81 Ibid.
>>>
Origins Range and Estimate of Oi! Tax Preferences in the U.S, 


27 


potential, consider it reasonable to seek special tax legislatian. Meanwhile 
according to Morgan Davis, the president ai Hum'ble Oil and Refining Co., 
from 1980 the r€serves will reach 20-25 billion barrels and besides, one 
can add the saAle amaunt as the effect 0'f technical and terminalagical 
drilling and recovery improvements. 32 
The \ problem ai reserve creatim as an argument for tax privileges is 
connected with walr need.s. One can conterarque that considering tbe 
potential war character in the era of long-range missiles it doe'S not seem 
justified to possess big oH reserves. The figurative staternent says that 
in case of war there is no security if it would be necessary to use gasoline 
from gas stations. 
One assumes that gasaline will be given priority during war opera- 
tions. But is it mO\re import ant than steel or electrical energy? Menge 
asking this question in the House Cammittee on Ways and Means stated 
that the choice is difficult and why not give tax privileges to some other 
industries OlI' even cancel a speciallegislation on tax. 33 Besides, in a futur e 
war, othersources of energy may be more useful than oil. 
Oil privileges f,or the mining industrygiven for the strengthening af 
national security have na reasan d'(mtre if one considers the faet that 
mining C01}ceImS the exploitation of sand, clay 0'r gravel. In addition 
however the use of milita;ry arguments is of no valve as far as American 
oił companies abroad are concerned. 
Tax law preferences cause investments in these branches of industry 


8ł Speach of Mr Morgan Davis before the American Association of Petroleum 
Geologists in: M e n g e, op, cit., p. 975. 
.8 Partly is was done in 1976. See: Summary of the Conference Agreement on 
the Tax Reform Act of 1976, (H.R. 10612), U.S. Government Printing Office, Septem- 
ber 29, Washington D.C. 1976. 
Sec. 202A. "The conference agreement requires that amounts, deducted for in- 
tangible drilling expenses on productive wells are to be recaptured upon disposition 
of the oil or gas property by treating those amounts as ordinary income to the 
ex tent that they exceed the amounts which would be allowed if the intangible 
expcnses were capitalized' and amortized over the useful life of the well. The pro- 
vision applies with respect to costs paid or incurred after December 31, 1975". 
Sec. 2709. "The conference agreement permits percentage depletion to be retained 
on property which is transferred by individuals, corporations and other entities, all 
of .which are part of the same controlled group after the transfer (and thus must 
continue to combine oil production to determine maximum number of barrels ol oi! 
eligible for percentage 
epletion). However, if any transferee ceases to be part of 
the same controlled group as the transferor at the some later time, percentage de- 
pletion is to be disallowed with respect to the transferred property as of that date 
(in order to prevent a proliferation of the limited exemption from the repeal of 
percentage depletion)".
>>>
28 


Jan Głuchowski 


which do not make alllY prafit. It takes place even when the profit si'zes 
are lO'Wer than the branchs of industTy nat having thase privileges. 34 
According ta the stJatisti'cs of 1959, American con:surners suying 
gasoline and using horne heating based on liquid gas had ta pay exbra 
costs amounting ta 750 million dallalrs l'eaching even 'One billion. 35 Mean- 
while. the oil industry re1nvestment wauld be weU used in ather branches. 
The energy crisis caused the aJbove-menti'Oned arguments ta be presen- 
ted in pTess and weekly-magazines. 36 First af all the press published the 
prafits of 'OH, campanies. . 
The publishedprafit sizes were considered ta be a suspicioUiS matter 
in the U.S. Its effect was the decltne in price af 'OH campanies shares in 
the New YO!l'k stock exchange. A special Senate oommittee headed by 
Senatar Henry Jacksonbegalll hearings af the' big companies. 37 It took 
place in the samerOOIn where the Watergate witnesses were examined. 
The hearingiS were taken aver by sena1Jor Frank Church's cammittee. 
AOCOI'ding 1Jo a. statement by the Gulf OH president, they were treated to 
their surpri'se and stupefaction as "real croks". 
The representatives af the campanies 38 had ta answer the guestions 
fis ta what ar
 the causes af wage increases, and if they had a:dditianal 
prafits during the ail crisis. Furthermore the oommittee c1a'rified its 
doubts about the role of the companies im. ,the energy crisis. In rea1ity the 
activity af companies was aimed at gaining maximumprofits. 
The basic rule of the 'OH Lindustry affered by Jahn D. RackefeUer 39 says 
tha't in the oH industry OIne must observe the principie of self-financing 
of investmelllt,s. Credits and laans are not incurred because it entails 
dependance 'On tł
e credit giver. 
Ii the bills beirng di,scussed by Cangress come in 1Jo law then these 
practices will be limited 'OT liquidated. The American Congress aims at 
the extensiOll1 a! fiseal contral aver the fantastic profits of Arnerican oH 
compalIlies. Attention shauld paid ta the faet that far the first time in 
AmericaIIl hisfiry one speaks about the additional taxation af prafi!ts con- 
sidered too high by the authorities. 


84 M e n g e, op. cit., p. 972. 
85 Ibid., 973. 
88 Big Oi! under Pressure, Newsweek, December 17, 1973, p. 39. 
87 Three companies are connected with the Rockefeller fami1y: l) Standard Oi! 
of New Jersey (formerly Es'so and present Exxon), 2) Standard on of California 
(soca!) and 3) Secony-Mobi!. The four other firms are Texaco, Guli, Anglo-Dutch 
Royal Dutch Shell and British Petroleum (BP). 
88 They represented Exxon, Mobil! Standard Oil of, California as the biggest 
ones. 
811 In 1882 John D. Rockefeller directed personally Standard on which became 
the trust.
>>>
Origins Range and Estimate of on Tax Preferences in the U.S. . 29 


The tax system is not an instrument sta tisfying the wishes of the oH 
industry. It has to fu1fill three different purposes: 40 
_ transfer resources from the private sector to the public sector, 
- contribute t,o fuU employment, 

 sever, from ihe social point view, equallshares of income. 
In nane of these points are included tax preferences fOll' oil industry. 
Within the framework of the Intemal Revenue. Code such aims are 
damaging in character. The tax system is sufficiently overburdened by 
production and consurmption steering. It cannot proV'ide the panaceum for 
aU aHments of the economy. Menge says that if one must cal'ry it out 
through the form Qf additional funds directly. Additional funds are easier 
to controll and they.cause less pressure on their expansion. 41 
Every time Congress changes tax legislatiQn someone gains and 
s()meone loses. If they dont look 50 much to profit in the change of obliga- 
tory tax regulations,. the tax law rule wouldn't be changed 50 often. 


REASONS FOR THE PASSING TAX PREFERENCES BY CONGRESS 


The executive organs know why high tax rates are not used in prac- 
tice. But governments are not strcng enough to cause the change of the 
st;;łtus quo. Concequently, in capitalist coutries where the baS1.s is the 
income tax, difficulties oceur in stcpping and limiting special tax legis- . 
lation. 
. 
 
An average congressman In ihe U.S. doesn't treat properly the upper 
tax rates reaching 71%. In considering partieular cases he often thinks 
that the !l'ates are too high and unju:ost. As a re suit a typieal definition cf 
lobbyists that such a high tax is "punishing" finds welcome applause lin 
the Congress. 
Many tax preferenees were passed by Congress as a result of the 
complex technique of tax legislation. Due to the comple
ity ofeconomic 
activity, authorities interested in the 'liquidation of "tax loop holes", the 
demand for tax equality, as well as interests of different lSoClial groups 01' 
donations is an eXO!l'ddnaryeomplęx matter. The ignoraTIce oi those details 
may entail unprofritable consequences. . 
The unitary tax privileges havn't any considerable .influence, 
,.the 
size cf public incomes, but they have a glreat influence on the in
 cf 
individuals and groups. It is easy' to know why a legislator aims at.;' the 
pa:ssing of definite preferences, but it is more difficult to say whY.J:1e is 
supported by other ccngressman. The existance of different rates in 


40 M e n g e, op. cit., p. 977. 
41 Ibid.
>>>
30 


Jan Głuchowski 


taxation ofincome and transfer of property allaws a member of Cangress 
to prefer the lower rates. 42 
The American C'Ongress is a mediator ł?etween the executive argans 
and pressure groups. It deals wit h important fiseal problems as wen as 
secand-rate technicalities. The Constitution states43 that 'Haw3'e of Repre- 
sentatives has the power to initiate acti
n conceming the collection af 
state incomes. But the Senate ean propose amendments to those prajects. 
The members of Congress, particulary those wha form tax committees 
have the opportunity af intToducing legislation which ref1ects individual 
01' group wishes. 
Tax privileges for the ail industry date back to the time of legislative 
campromisises and such interperetation af legal acts which used ta con- 
si der the interest of particular branches af the economy. From the 
moment when the existing status qua was legally approved, the privileges 
were rather theabject af defense than attackat the Oangressional farum. 44 
A memiber of a legislative 'Organ is often interested in taking inta 
consideration theinterests af different pressure graups. lt may depend 
'On his 'Support if he will be reelected ta his p'O,sition, and the party he 
represents wiU nat lose 'One seat. I'n this situation the cangressmen's 
support in passing tax preferences is the source af fi!llancing the casts 
connected with his election eampaign. One states that the campaigns af 
majOTity af cengresmen are financed by pressure groups and interested 
individuals. 45 
The essential cause af passing tax preferences by Congress is the laek 
of information on this topie aceesible ta the average voter. The people 
dealing with cangressional sessions mayanly get to know the tax rate 
structure. They will gain only a smalI understending as to why fiscal 
burdens lai d 'On the mast wealthiest citizens are unpropartianally small 
in comparison with their incomes. The tax law jargon is an obstacle 
difficult to overcome for an observerof parlaiamentary debate, when 
broadcast through the mass media. 
The passing 0.£ tax preferences favors the breach of party discipline. 
Haltzman stated that in American Congress the break af discipline - as 
it is understodd in EUT'Oipean parties - is an every day occurrence. The 
mem'bers of Cangress, who vote against the views of their club eolle- 


.. As an example the gift tax may include the amount spent on transfer life 
insurance. This amount, otherwise, would be subject of estate tax. See R. M a g l i b, 
The Federal Gift Tax, Columbia Law Review, 40/1940, p. 773 and C, L. H a l' r i s, 
Legislative History of Federal Gift Taxation, 1940, p. 531. 
43 Article I, sec. 7. 
44 S. S. S u r l' e y, The Congress q.nd the Tax Lobbyist-How Special Tax Pro- 
visions Get Enacted, Harvard Law Review, 70/1957, p. 1164 ff. 
45 Ibid., p. 1175.
>>>
Origins Range and Estimate of on Tax Preferences in the U.S. 31 


agues, but together with an opposite party, don't run any risks. A member 
of Congress can vote a few times against party leadership in the House 
and against the majority of his colleagues, and still adhere to the party 
without risking any disciplinary consequences. 46 
It l'S generally aSEumed that the princiiple oi tax justice is observed 
at the Congress forum by the Department of 'Dreasury. The lobbyists 
forming tax preferences are backed by inf1uential acquaintances and con- 
siderable finam::es funcis. The Departments' strong side is its knowledge 
of tax problem:s. 
The amount of money spentby lobbyists used to reach exorbitant 
sums and is still does. The effect of these e:xpenses must be profitable 
becouse they are still made but heverthless som e exceptions take place. 
Theoil-gas industry in the mid-iiities undertook an action aiming at 
passing the Natural Gas Bill oi 1956 in Congress. When the project was 
approved by the House of Representatives it seemed that it would also 
be favorable treated in the Senate. At that time the companies employed 
on their own initiative a lobbyist who gave suitable sums to the "gene- 
rous" 
epublican senators and 10cal branches of this party. One of the 
Senators revealed this fact at the Congress forum and declarE
d that he 
decided vote against the bill. The project passed the Senate but the pres- 
ident vetoed thebill. Eisenhower didn't oppose the subject ma:tter of the 
bill, but vetoed it because of the obstanent and rude form of the lobbyists 
action. OOlI1sequently in spite of the powerful oillobby and its su,pporters 
as well as $1,5 milion in public campaigning and $2,500 in bribes the 
effort failed. 47 
':Che high positioned persons in the Department oi Treasury hierarchy 
have the duty to pre,sent to the Congress the paint view of the executive 
organs andgain for themthe acceptance of Congress. The tax experts 
from the treasury department do not have an easy time interpreting 
int'Ncate problems to congressmen. . 
The Department of Treasury staff is not always familiar to the mem- 
bers of Congress. The Treasury employees don't hold any political func- 
tions and therefore they don't meet coqgresmen at the Congress forum. 
The possibiIities of any detlai1ed explanation of tax complexities in 
legislative hall are limited. Voting, the Congressman bas to make a decis- 
ion on the basis of short report and usually limited discussion. 
The staff of the Department of Treasury is not always awere of every 
detau. It can entail negative consequences. The Congressman listens to 


40 S. E h r l i c h, op. cit., p. 123. 
41 A. H o l t z m a n, Inter8sts Groups and Lobbying, New York-London 1966, 
p. 79-80.
>>>
32 


Jan. Głuchowski 


, 
the voters tax wishes and puts them forward to the Treasury Department. 
The Department bas to co1'1t1'Ol these motions. If it fails to do it they will 
be quickly app!l'oved. The per l SOII1 sitting in Congress doesn't treat the 
di'scussion over tax preferences as the representative oi any group Ol' 
public interest. He looksrather at th.e interest of particular perso]ls and 
state depa:rtment. 48 
A Congressman notbeing an expert in tax policy looks at certairi 
pr9bl
msas different questions unconnected with the whole system, 
regulated by Internal RevenueCode rules. He thinks that the decrease af 
big U.s. budget incomes 49 
y a few millio1'1 doesn't requiTe any particular 
mention. But together these are considerable amounts. It is worth paying 
attention to t'he terminological e
prelssion. One usesthe .. phrase 
"treasu:ry losses" but not U .
. los.ses, 01' looses to the American ŚOciety as 
a whole. 50 


SUMMARY AND CONCLUSIONS 


It i,s a widely accepted view that tax preferences are the toolfor the 
realization oi a given economic policy. It doesn'tseem to be the best and 
right solutia1'1.ln place of a tax system an intermediatory one shou1d use 
the forrn of donations. 
One assumes that the oH production is very important for the national 
econórny and one must st:rongly IsUpport its development. However one 
branchoi the economy is favored at the'same Ume another one is disc:ri- 
minated against. In this respect in the legislative process orie must 110t 
favor one hranch, but one has to look at the 
onomy in its entiirety 
eomplexity. 
A dollar spent on investments, consumption OT put into a savings 
bank should be treated in the same way as any otheT dollar spent on 
the. above-mentioned purposes. If O'I1e diff.erentiates tne burden of 
taxation basis expressed in mon
tary units on the ground of gaining, 
spendlng or saving, then one upsets its position as a common value 
measure. 
Subsidizing through the intermediary of a tax system is additionally 
baąeless for other formai reasons. Tax legislation . is complicated. Diffe- 
rentsorts of concession, exemption Ol' tax eut are more diffieult to be 


48 J. G ł u c h o w s k i, op. cit., p. 9
-94. 
40 I d e m, Dochody i wydatki budżetu federalnego Stanów Zjednoczonych przed 
drugą wojną światową, Acta Universitatis Nicolai Copernici. Prawo XII, Toruń 
1973, p. 37-46. 
IO.S. S. S u r r e y, The Congress..., p. 1157.
>>>
Origins Range and Estimate of on Tax Pi-eferences in the U.s. 33 


socially cantr.olled. Cansequent prafit measures can't be so prapoTtianate 
as in the situatian of financing from the budget. 
Tax preferences misfigure mast af a11 the amaunt af tax which shauld 
be paid and they increase fiscal laads concerning the whale society. 
Re'Slpecting preferences 'One has to intraduce the diiferent1ation in tax law 
between th.ose wha can use them and the rest wha are nat entitled to it. 
If the preferences are introduced then every tax payer will da his best ta 
get affiliated to one af these groUlps entitled to privileges. / 
Special tax legislation develaped byoil lobby activities increases the 
demand .on tax advisors. Aid from private tax experts may fulfi11 a double 
purpoise in the opinian of iinterrested people: pratect them' from making 
mistakes by paying the tax owing and enable them to profit fram 'Obliging  
tax privileges. At thesame Ume private advisors will try doing their 
best to shaw their talents and adverithe the profits flowing from 
their help. 
BIum analizing at length the adivities af fax experts 51 paints to the 
fact that tax payers using the prafessional taxadvisars have the posSibi- 
lity af maximum planing af their incO'mes from the point af view of fi scal 
burden. Directly 'One plans the ene1rgy measures which will be used in 
prafessional work. 
Tax plann1ng takes a lot of time. Therefore the group af American 
lawyers dealing with tax matters is very I1umeraus. One of the ta sks af 
this graup - ta wh:ich belongs nearly every forth law graduate - is to 
influence theOongress in order to pass tax prefererrlces prrofitable for 
thei'r customers. The :passed deductions aTe indirectly profitable fOT 
lobbyists, getting higp.er fees forr their services, the greater the vałue 
gained through negotiated tax preferences. One can state that thase 
lawyers wha specialise in . taxes farm an arganized group acting 
n the tax 
payers interests. 
The tax lobby appeals ta the public interest. Meanwhile as one af the 
best Amerkan lawyeDs ,stated, vox papuli may easHy be repleaced by the 
voice af p!l'essure giI'aups, which equalize the particular interests with 
a public interest. . 
Tax preferences may cause many negative psychic responses. lt will 
occure when the tax payer discovers that becouse of the la9k of legal 
knowledge he didn't profit from his privileges. Or, an additional example, 
when he recognizes that other tax payers familiar ta bim profit from 
preferences although an objective comparison of aU the details of their 


61 The Effects tJf Special Tax Frovisions in the Income Tax on Taxpayers Mo- 
rale, Jooint Committee on Economic Report, Federal Tax Policy for Economic 
Growth and Stability, Washington D.C. 1955, p. 253-257.
>>>
34 


Jan Głuchowski 


situatian shows that privileges are groundle.ss and they harm the other 
taxpayers. 


* 


* 


* 


The presented materialleads to the folIowing seven conclusions concer- 
ning fiscal preferences far the American oH ilndustry. 
1. The Congressianal forum is used as counterbaJ:ance ta the cours. H 
the court case fai1s then aittempts are made ta at changie existing law. 
For this 'reason it is often said: "H we dan't win in Jthe courts, we can 
always win in Congress". 
2. Tax preferences concern particulary high incomes. The big oH 
companies use them, but not an average tax payer. It has a negative 
impact 'On the standard of living of an average American c'Onsumer. The 
awareness of this fact may have Important 50cial consequences. 
3. Many tax payers are not taa familiar with the tax regulations. 
Moreover; they aTe ofteIi convinced. that tax preferences should be 50 
expanded as to inc1ude them as well. 
4. Preferences effect firms which didn't use them and they result in 
the tax law being less opera:tive. It liS much mare difficult to in:terpret it 
correctly and use it in praotice. 
5. The tax system shO'Uldn't be the tool of immediate intervention. 
H there are well-grounded reasons for coming to the aid of mining indu- 
, stry then one must use subsidizing. 
6. Multiple price increases on oH are source ofpressure exerised on 
the Congress aiming to resolve the existing situation. In effect the Con- 
gre,ss is farced ta consider the reform of oil industry taxation. 
7. One mus t sha're the opinion inc1uded in the report af Buchman 
Committee presented to 81st Cangress that, "the people must caver the 
costs of lobbying and pay for its end results",
>>>
A C T A U N I V E R S I T A T I S NI C OL A I C O P E R NIC I 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 106 - 19'19 


Department of Financial Law, Toruń 
Department of Social ScienCes, Bydgoszcz 


Jan Gluchowski, Kamila Norek 


THE W A YS AND MEANS COMMITTEE OF THE HOUSE 
OF REPRESENT ATIVES IN THE AMERICAN CONGRESS 
THE TAX LEGISLATIVE PROCESS 


c o n t e n t: Taxing power of Congress. The origin, structure' and the functions 
of the Committee. Thę tax legislative process in the Committee. 


TAXING POWER OF CONGRESS 


The process of making tax decisions is considered to be one of the 
most interesting and cont,roversial element s of the federal 1egislature. 
Frequent attemps que:stioning the effectivness of the process have been 
made, but hardly any oi them, even the. slightest, led to success.1 The 
Congress plays the most decisive role in the prQcess. It perfoTms this 
function through its Way:s and Means Committee of the House and its 
equivalent body in the Senate - Le. Finance Committee. 
According to the American Constitution (Article I, Section 8, Provis- 
ion 1) "The Congress shall have Pow er To Lay and collect Taxes, Duties, 
Impost and Excises[...]". In practice tax legislative process is usually 
initiated by the President's Message. 2 President has the 'right to recom- 


1 Objections comprise mainly the tractionation ot the expenditure - tax process, 
excesive influence of interest groups on legislative process, the speed of the Con- 
gress action. The last objection has been frequent1y repeated since Kennedy's presi- 
dency. The suggestion of partial delegation of the Congress fiscal authorities to the 
President has not arisen the interest of the Congress. J. P e c h m a n, Federal Tax 
Policy, Revised Edition, Washington 1971, p. 45-49. 
t There are not legal requirenments in this field. Twice in the post period .the 
Congress made use of its constitutional authorities to ini.tiate bil1s. In 1948 the Repu- 
blican Congress passed over President Truman's veto a bill reducing individual 
income tax rates. In 1969 the Congress action preceded the propos'als ot newly 
alected Nixon administration which did not place tax reforms at the top its of 
priorities. R. A. D i a m o n d, P. A. O'C o n n o r, Con(łressional Quaterly's Guide to 
Congress, Washington .1976, p. 120.
>>>
36 


Jan Głuehowski, Kamila Norek 


mend law reforms, however it is 'only in the powerof Congress ta enact 
them into law. The majarity of President's recammendatians undergo 
considerable revisions and a lot af them get rejected. 
Broad constitutianal powers of the Congress as ta tax decisions are 
submitted to certain limitations. They have been formulated in furthel' 
sections of Artic1e Idefining legal pracedures of imposing diTect and 
indirect taxes a,s. well as apportianment ór tax burdens amang States. 
ACC'Ol'ding to ArticIe I, Section 9, Provisian 4 "No Capitatian, ar other 
direct, tax shalI be laid, unless in Proportion ta the Census of Enume- 
ration herein before directed to be taken". Artic1e I Section 8, Pravis- 
ion 2 states that "...ali Duties, Imposts and Excises shall be UII1iform 
thoroughout the United States". 
The importance of the above' mentioned limitations can he illustrated 
by the history of individual income tax resalution. The tax is considered 
to be direct 3 which accoroing ta Artide I, Section 9, point 4 means the 
necessity of 'sharing it among States in proportion t'O the number ef 
inhabitants. However the distribution of wealth and population is not 
equal, 
hich resulted in. stTong politieal opposition against introducing 
the tax when the Congress took steps in this domain in 1895. It was not 
before the ratification af the Sixteenth Amendment (the Congress shall 
.have power Ito lay and. collect taxes on incomes,
om wpatever source 
derived, without apportionmentamong the several States, and without 
regard to any census Ol' enumeratian) in 1913 that the basic source of 
federal revenues became available. 4 
.Othęr limitations ł'esult rram the SD called irttergovernmental immu- 
nit y 5 accepted by Supreme Court in 1919. The doctrine of immunity is 
based on the theory of State sovereignty and on the als,sumption that 
both federal and State governments should not levy taxes on property 
and instrumentalities of eaeh other as it leads to violation af sovereignty. 
In p:tacUce the limitation occurs mainly while exempting state and mu- 
nicipal bonds from federal taxation. With sa defined autorities the Con- 
gress carries out itstax legislative functions. 
Aceording ta Article I, Section 7, Provisian l tax bills .should originate 
in the House of Representatives. They are quesioned under examination 
by The Ways and Means Committee. Mter heing passed through the 


8 According to. elassifieation made by the Supreme Cour,t in 1895 a tax is eon- 
siderad to be indirect if it cannot be avoided wbiłe direct tax cali be shifted to 
other person. W. S. B a r n e s, Tcixation in the United States, Chicago 1963, Harvard 
Law School, p. 85-90. 
4 Today only federal state tax is appotioned amon g states depending on the 
number of inhabitans. 
5 R. Diamond, P. A. O'Connor, op.,cit., p. 111-112.
>>>
The Waysand Means Committee oi the House of Representatives 37 


House of Representatives a bill is transmitted to the Senate Finance 
Committe where same amendments may be suggested. A prorposed bill 
reaches the Senate f10m ta be discussed. In oourse of1aw ,arising diffe- 
rences are reeonciled by the Conference Committee of both Houses. The 
final version of the bill must be arpproved by the President. A complex 
analysis af the wbJole tax process goes beyond limis of present paper. 
It only discusses the tax responsibilities resting on the Ways and 
Means Committee of the Hause af Representatives. Special procedur e 
applied far legislative actians of the Committee as wen as it particularly 
privileged pasition in the House have been considerably limited in the 
course af reform 
erformed by Demacratic Caucus in the years 
1973-1975. 


THE ORIGIN, STRUCTURE ,AND THEFUNCTIONS OF THE COMMITTEE 


The Ways and Means Committee in which a tax bill is originated 
(Artic1e I, Section 7, Provision 1) came into being in 1802. It was the 
concern of the Committee to handle the revenues and spending. lts 
cantrol overspending underwent gradual limitation up to creation the 
Appropriation Committee in 1865. At present it aurthorizes jurisdiction 
over revenues, debt, customs, trade and Social Security. 
On the years 1911-1975 the members af the Committee from the 
Demacratic Party acted as oommittee on oommittee, i. e tney decided as 
to the assignments of democratic congressman for rparticular cammittees 
of the Hause. Since 1947 the Committee has had sixchairman, four of 
them from the Democratic Party and two from the Republican. 6 The 
most distinguished chtairman af a11 ,was Wilbur D. MilI:; (D. Ark.) His 
great authority over the shape of passed taxbills resulted fr'om the long 
period in which he heM the office (1958-1974), Ąjs knawledge in the field 
af law' and also from the fact, that his Committee oonsidered aU tax bills 
as a whole (Up till 1975 the Committee had no subcommittees, although 
there were some rare instances whenspecial suboommittees were formed 
to examine a particular question. The subcommittees were dissolved after 
having performed their task). 
TraditionaUy the Committee consisted of senior members of the House 
of Representatives and was gęnera11y considered to be a conservauve 
graup, which acted with' much thaught aft
 long deliberation. 
The Ways and Means Committee itself many a time took pride inits 
. ' 


8 The funcUon was succesively perfOrmed by H. Knutson (Republ., Minnesota, 
1947-1949), R. L. Doughton (Dem., North Carolina, 1949-1953), D. A. Reed (Republ., 
New York, 1953-1955), J. Cooper, (Dem., Tennessee, 1955-1957), W. D. Mil1s (Dem.; 
Arkansas, 1957-1975), Al. Ullman (Dem., Oregon, from 1975).
>>>
38 


Jan Głuchowski, Kamila Norek 


careful and professional work on tax bills. This helped the Committee to 
attain its high standing in the House of Representartives and resulted in 
the fact, that the House passed the majority of bills pToposed by the 
Committee in the deeade prior to 1915. All major bills brought to the 
floor of the House by the Committee were considered up to 1973 under 
the closed rule. The rule prohibited any floor amendmen1Js. The assingn- 
ment for the the Committee was believed to be the most attractive in 
the House. 
John C. Eberhardt'1 made a oomparison of. oommittees in the years 
1914-1941 and noticed that the Ways and Means Committee had highest 
reputation in the Hou:se. Thesame comparison for the pommittees between 
the 80 and 88th Cong:ress was carried out by Warren Miller who also 
found the Ways and Means to have the most favourable position. The 
assignment of the Committee members to any other committee including 
Appropxiation Commitrtee was regaraed to be a step baek in their political 
career . 
Participation in the Ways and Means Committee gave its members the 
status of the Hause elite. Their pasition was higher than that of other 
congressmen and their superiority resulted from their belomging to the 
Committee in which they performed their functions. The attractiveess of 
the Committee also depended on the fact i1Js members had a vast opportu- 
nity of meeting different demands of constituency which ensured geod 
chances in future election to the Congress. 
The Representatives of tthe Ways and Mea'I1s C8n secure the oons- 
tituency demands malcing dedsions concerrnmg the major legislation of 
the Committee as well as through sa called "members' biHs". There "are 
some less important piece's of legislation comprising slight changes Ol' 
supplements in tax bill and eontributing towards certa in technical impro- 
vements of other bins under the Committee jurisdiction. "Members' 
bills" - concern marginal problems important nearly solely for the 
member of the Committee who introduced them. 8 Minor matters dealt 
with thorough members' bills are frequently essential for individual 
congressman and their sum leads to aeeumulation of substantial credit 
which eam be used by the Committee and its charmain if needed. 
However beginning from 1974 vast authorities of the Committee and 
its head became the subject of growing discontent. It also refferred to 
Wilbur Mi1ls' private life and his health. In October and December of 


7 G. B. G a 11 o w a y, C;ongress at thę Crossroads, New York 1946, p. 90. 
s J. F. M a n le y, The House Committee on Waysand Means ConfLict Manage- 
ment in a CongressionaZ Committee, American Political Science Reviev, 1965, p. 927- 
939.
>>>
The Ways and Means Committee ot the House ot Representatives 39 


1974 the Democrats from the House of Representatives dedded on some 
fał' reaching changes in a'Ctions of Commi!ttee. In consequence Mi1ls 
resigned and was succeeded by Al Ullman - a Democrat from Oregon. 
Ihe folowing changes were introduced: 
_ 'I'he num:ber of Committee members was ncreased from 25 to 37 
Twelve of the newly elected members were not recruited from the senior 
members of the House. 
- The Committee was required to establish suocommittees and the 
members were given the right of decision as to the quantityand suboom- 
mittees jurisdiction. 1I 
- A rule governing the order of assingment was introdvl'!ed. Senior 
members were to assigned first but their subsequant appointment depen- 
ded on junior members assigment to at least one subcommittee. 
- Committee on committee function was transfer red to Democratic 
Steering and Bolicy Oommittee. 10 
_ A compromise solution concerning close rule was made. 50 Demo- 
crats were allowed to 'Suggest amendments on the Caucws Floor. If Caucus 
Accept amendments the democratic members of the Rules Committee are 
reoomended to issue the rule allowing floor amendments (More detailed 
discussion of the last reform wiU b
 presented in the part of the paper 
,dealing with procedural problems).ll , 
A series of changes known as "the bill of rights" and introduced by 
Democratic Oaucus oomprised together with the above rules several other 
revisions directed against excessive centralisation of Congress power 
resting on influential chairman of main committees. The postulate refer,r- 
ing to clreation of subcommittees has been furmulated more universally 
t}:lan it was presented above, as it required for aU committees (and not 
only the Ways and Means) counting more than 20 members to establish 
at least four subcommittees. The chairman simultaneously obliged to 
present a bill to a subcommittee within two weeks. To make the chairm6n 
share his power with other Democrats every committee created its 
Democratic Causus. Although the reforms concerned aU committees of 


. The following subcommittees wete 'assigned Social Security, Health, Trade, 
Public Assistance and Unemployment Compensation, Oversjght and Miscallaneous 
Measures. 
10 Democratic Steering and Policy Committee consists of the Speaker, Majority 
Leader, The Caucus Chairman, eight members appointed by the Speaker and twe1ve 
members elected from twelve equal regions. In addition to it8 new function of Com- 
mittee on Committee the Democratic Steering Policy Committee recommends party 
policy, legislative priorities, schedules the matters for House or Caucus action. 
F. C u m m i n g s, Capitol Hill Manual, Washington 1976, p. 85. 
11 The changes refer solely to the Democratic Party ot the Congress and have 
never been accepted by the whole of House.
>>>
40 


Jan Gł1,.lchowski, Kamila Nore
 


the House of Representatives they were -a direct attack on the system of 
functioning of the Ways adn Means Committee being the most centralised 
committee of theHouse just as its Senate counterpart the Finance 
Committee. 
Before ,succesion to the office of the Committee chairman Wilbur MilIs 
was in charge of Internal Revenue Subcommittee. Shortly after. his nomi- 
nation however he diissolved a11 suhcommittees. 
The "Billof Rights" from 1975 as presented above put limitation to 
a series of other greatly important and favoring authorities of the Com- 
mittee. The po:sition of Waysand Means was particulary weakened by 
deprivation of the 'right to appoint democra,tic congresmen to other com- 
mittes. From the moment the new representatives we re elected,they felt 
obliged and dependent on the members of th
 Ways and Means, and the 
depedence was still existing even after heing promoted to higher post in 
congressional hierarchy. 
The "committee on committee" function was oneof the main sources 
of the enourmous power of the Ways and Means. Despite the attenuation 
of the Committee position resulting from the latest reform it still remains 
"exc1usive" - unde'r Democratic Caucus rulesno member of the Oom- 
mittee is allowed to serve at the same time on another committee. 12 
The Ways and Means (together with Appropriation Committee) despite 
aU theperformed changes still carries the. function thorough which the 
Congress realises its most important authorities - the right of decision 
over fedel'al revenues and spending jointly termed as "power of purse". 
AlI of the other powers including declaring the war become invalid when 
deprived of "power of purse". 


THE .TAX LEGISLATIVE PROCESS IN THE COMMITTEE 


The process begins in the Ways and Means Committee in ordinary 
course of Congress procedures. The work of the Committee on the tax 
bill start s with public hearings. The first witness is usualIy the secretary 
of Treasury.13 He delivers a long elaborate statement presenting a tho- 
rough justifiC'ation of the program of Administration. The secretary 
usualIy reads his statement without interruptions. Thechairman opens 
the hearings and allows the members of majo rity andminority parties to 
ask questions in accordance with seniority. Mter the secretary's testimony 


12 F. C u m m i n g, op, cit., p. 84. 
11 AIso in this instance there are no legal requirements. In case of passing of 
Tax Reform act in 1969 when the Congress itself undertook the legislative initia- 
tive, a witness of administration was invitęd only after sevęral months ofhearing&.
>>>
The Ways and Means Committee of th
 House of Represęntatives 41 


the ',Committee may hear witnesses from other exeeutive agencies. The 
next to be testified are the representatives of bankers, businessmen, 
lawyers, economistsand others representing the interests of private 
grou1ps and at times individual persons. 
The time 'Of hearings depends 'On the importance of bill, controversions 
which might have arisen, on the prestige of the ehairman and ranking 
minority member. In case of serious controversions the hearings last for 
the months. They lasted only 12 days while passing the Excise Tax Re- 
dudion. Act of 1965 and as manyas 8 weeks while passing the Tax 
Revenue Act of 1969. A lot of observers consider the hearings as the most 
important stage ofCongress committees activities. 14 They aim at gathering 
both technital nad pol'itical information from various actual and potential. 
pressure groups. They arisepublic interest in the problem, lead to con- 
solidation ar change of social orientation. They function as "propaganda 
channels" and ease group conf1icts. Afteripresentation of their argument s 
groupand their representatives are more willing 
o compromise. ' 
The hearings are considerad t,obe an important factor of thepolitical 
system, as they develop unanimity. A country of so deeply differentiated 
social, economic, cultural and political life can achieve its unanimity in 
gradual process. Mter hearings the Committee may start with "executive 
session" where bills are amen de d, redrafted, voted upon and reported. 
Up till 1973 the sessions were usually closed to the public but sine e 1973 
after some new ,rules ooncerning the Bem'et of C'Ommittee work were 
defined they have become open (In 1974 the Ways and Means Committee 
had 94,open sessions and on1y 4 clo'Sed). , 
The invitations to to the sessions are delivered to the staff members 
of Joint Internal Revenue Committee 15 and Treasury officials. The bill ' 
isthen. doscussed, the opinłons and information arising in the course of 
hearings are reeapitu1ated. Some members play a particulary important 
part in the processof negatiating and compromisi-ąg during these execu. 
tive sessions. The most decisive is, of course, the role of the chairman 
who menages the debate and is the main arbiter. The ranking minority 
member is a1so very influentia1 especially if he is able to persuade sóme 
members of the majority party to suppart him. 
The chief of Joint Internal Committee supervise'S the work of large 


14 W. L. M o r r o w, The Standing Committees, washington D.C. 1969, p. 1
35. 
16 . The Joint Committee on Internal Revenue Taxation consists of memb,ers od 
both houses. It is composed of the senior members of the Ways and Means and 
Finance Committees. The Joint Committee has no legislative power and its making 
recommendations for both legislative committees. The Committee employs a lot of 
tax experts (41 people in 1975). R. A. D i a m o n d, Powers of Congress, Washington 
1976, p. 19-.20.
>>>
42 


Jan Głuchowski, Kamila Notek 


group who help the Ways 'and Means in thei'r delibera1io:ns. He takes part 
in all sessions, negotiatiorrs on the bill and helps to find 
ompromise 
between the attitude of the chairman and other members of the Com- 
mittes. The 'assistant secretary ofthe t:reasury perfO!l'ms the duty of the 
main negotiator of Administration (in accordance with the instructions 
of the President and the seoretary of the tTeasury). When a decision is 
made it is translated into language of a bill. This task is the responsibility 
of Legislative Councel of the House of Representatives. The process often 
turns out to be time consuming, as every bill must be formulated c1early 
and unequevocally. 
The next stage concentrates on preparing committee report supervisecl 
by the chief of The Joint Internal R
venue Committee. The report 
contains a detailed motivation of committee decisions and analyses the 
bill "section - 'by - section". It a1so indudes the views of commit'tee 
members oponent to the law. 
Since the report is the only written document justyfying the decisions 
being made it serves as the main source of information for the House and 
constitutes a basis later interpretation by the Internal Revenue Service 
and courts. When a report is ready it is voted upon and the comm'ittee 
order s the chairman to send the bill to the House. Before 1973 special 
procedures were traditionally applied when passing Committee bills on 
the House £1001'. 
The House aocepted allbills without making amendments. From the 
technlcal point of viewand in accordance with the House Rules tax bills 
could be considered prior to other bills and withQut "rule" Le. written 
resolution of the Rules Committee defining the procedures and time 
limits for a debate and V10ting on a measure. 
In practice the Committee did not made use,of the privillege. As in 
this case the House would be able 1;0 offer the ar'nendments to the bill. 
Other solution seemed to be more convenient for the Comrmttee. The 
Rules Committee traditionally issued so called "c1osed rule" £01'- the 
House action while considering tax bill's. According to this procedure 
a bill was closed to amendments in the course oi a debate of the House. 
This led to debates lasting usually not longer than two Ol' three days. 
There was only one exception allowing floor amendments on condition 
that the Ways and Means Committee approved of them. (seperate from 
thebill). In this case they Icould be presented on the floor oi the House by 
a member oi the Committee and voted upon. This gave the Committee 
the possibility oi withdrawal of its provisions when the House opposition 
proved to. be particulary strong. 
Wilbur Mills who enjoyed great respect argued that tax legislation 
was tow complex to let any amendmentsbe made on the £1001' o£ the
>>>
The Ways and Means Committee of the House of RepresentaUves 43 


House by individual congressman as this wou1d only disturb in realiza- 
tioI\ of more universal purposes of a bill. This type of bills can be easily 
influenced by pressure groups representing different aims.The House 
observed the rule of isolation fram this influence allowing for their inter- 
ference onlyon the stage of committee wark. 
Tradition .cf close rule however became the object of fierce attack on 
the side .cf the House members as one of the aspects of tremendaus power 
of the Committee. The first tax billconsidered under open rule was 
interest equalization tax bill of 21 February 1973. Representatives not 
being members of the Ways and Means Committee (410) did not take the 
opportunity of making amendments. It was the first, within 41 years, bill 
considered with the appliance af open rule. (The former was amended 
Revenue Act of 1932). 
During the 92 c.ongres the Rules Committee granted its cansent for 
discussion of 13 b'ills with the use of dase \1"ule and of 191 with open rule. 
Close rule reform was far the first time used effectively in 1975. On the 
26 February 1975 the Rules Committee permitted seven floor amendments 
to the tax bill HR 2166 establisting tax redudion by the sum od 21 bilion. 
The chairmanof the Committee Al Ullman applied for invalidation of 
all amendments but the House succeeded in passing the amendment of 
tightening tax preference in oil industry (voting 248-163). Other amend- 
ments were rejected. The last af the presented remarks concern the 
action on the House floor but because of their pecularity and the refe- 
rence to Ways and Means Committee they were described in this essay. 
The role of Ways and Means c.ommittee is c10sely connected with the 
range of the considered matters and with the influence of the state on the 
managing the natianal economy. Wilbur Mills during his long - term 
tenure of office considered the reduction of taxes as the way of govern- 
ment spending reduction and the factor fordng the gąvernment toward 
more rational activity. From the half of sixties shifting of the aims of 
fiscal policy ,can 'be noticed. The priority given to col1ecting the revenues 
was replaced by the influence of taxes on the economic growth. Up to 
now the Ways and Means Cammittee remains an important link in 
realization of the federal fi scal policy. It has the decisive influence on the 
final shape af legal acts which regulate the :fiscal policy.
>>>
ACTA UNIVERSITATI.S NICOLAI COPERNICI 
PRAWO XVIII _ NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 19'19 


Departmem of General Theory of State Clnd Law 


Wieslaw Lang 


DEBATE ON LAW AND MORALITY 
IN CONTEMPORARY AMERICAN LEGAL PHILOSOPHY 


c o n t e n t: The paper contains a critical analysis of the discussion on law and 
morality, which is going on in contemporary American Legal Philosophy. The author 
focuses hisconsiderations on the controversies between legal. positivism and modern 
Natural Law theories. He argues that, these controversies have been considerably 
reduced and that there are no fundamental contradictions between contemporary 
positivist concepts of law and legal theories linked with modern versions of Natural 
Law Philosophy. The author contends that a11 these theories are clearly legalistic 
and liberal philosophies of law. 


1. The problem of the rela1Jions between Law and Morals has been for 
centuries one,of the main topies of legal philosophy. In EuropeariPhilo- 
sophy of Law this topie was theeentral issue in the traditional dispute 
between Natural Law Theories and Legal Positivism.Nowadays it stil 
remains the eore of philosophical discussi!ons on Law particułarly in 
contempora:ry bourgeois legal philosophy. Philosophers inquiring the con- 
eepts of Law and Morality 
ndicate the great complexity of the relations. 
which can be traced between these 'two forms of social control. "There 
a'remany types of fela tions between law and morals a,nd there is nOlthing 
which can be profitably singled out for study there as the relation 
between them. Instead of it is important to distinguish some of the many 
dHferent things whirch may be meant by the 'assertion Ol' denial that law 
and mórais are rela ted", - writes L. A. Hart.1 There are two types of 
relapons between law and morality which have been most1y discussed; 
functional and substantive (as regards content). The functional relations 
consist in mutual interactions of law and morality. These relationscan 
be found out by, the way of historical Ol' sociological investigations. The 
substantive relations are those occurringbetween the content of moral 
, and legal norms. This type of relatii:ms is particularly the object ofphi- 
losophical discourse. 


1 H. L. A. H a l' t, The Concept of Law, Oxford 1963, p. 181.
>>>
46 


Wiesław Lang 


The aim of the present paper is to give a brief critical summary of the 
discussion on law and mora lit y, which is going on in contemporery Ame'" 
rican legal philosophy: 
2. There are some peculiar features of American culture; American 
Law and American historical social and political background, that make 
this topie a very significant one and infuse the discussion with a speciiic 
f1avor. 
American Law has alwa)1lSbeen strictly linked with morals. Since its 
very origin it was permeated w
th moral ideas dominant in American 
society. These ideas are clearly eX!pressed in the provisions of American 
Constitution (especially in the amendments of the Constitution). 
Common Law system impart some significant moral standards. Stan- 
dards and vall.les of conventional public morality play a very important 
role in the legislative law making and in judicial decision making process. 
Especially the decisiO'ns oi the Supreme Court of the USA are both ref1ec- 
ting and iniluencing the evolution of ethical ideas in Americansoclety. 
The moral values declared in American Constitution and promoted. by 
american legalOrder have their original SOU1'ce in the ideas of Natural 
Law Philosophy.2 
On the othe!l' hand the dommating ethos of American sodety is a le- 
galistic one. Law is considered not only as a means of sacial policy Ol' 
social engineering but also as a rrtoral value which has a high position in 
the hierarchy of values accepted by American society. The p!l'inciples of 
legality, particularly Ithe principie of the Rule of Law and the due 
proces s of law are conceived 'as moral principles. The government is 
considereld a:s the goverment of laiWs but nO't of the people. Unitil the mid- 
eentury the idea of justiee was in popular thinking identified with lega- 
lity 01' legal justiee. 3 It seems that a very pecular feature of American 
eulture is morally laden law and Ił legalistic conventional morality. This 
feature had aparamount impact on the development of American Juris- 
prudence and legal philosophy. 
The history of the development of the J urisprudence and philosophy 
of Law in USA in twentieth century can be ddvided in to three distinctive 
periods: 1. The period befm'e tbe World Warr II. 2, The period since 1945 
unitil the early sixties. 3. The period ,from the beginning of the sixtieth 
until now, 
Almost all legal theories developed in the first and second period 
exhibit the same general tendency in dealing with the relations between 
law and morals. They tTeat morality as a set of standards and values 


I S, H. S i l v i n g, Positive N atural Law, Natural Law Forum, 1/1960, p. 25-43. 
I R. R. H alI, The Morality ot Civil Disobedience, New York-Evanston-San 
Francisco-Londyn 1971, s. 2-13.
>>>
Debate of Law and Morality in Contemporary... Philosophy 47 


extrinsic to positive law (law in juristic sense), which is conceived as 
a set of rules Ol' decisions. produced by the agencies of the state Ol' bf 
other formai organisations. 
This is true not only about the positivistic theories such as analytical 
jurisprudence, legal realism Ol' Kelsen's Pure Theory oj Law but aiS 
about Natural Law Theories (of Natorph, Wild, Kaufman, and catholic 
theories) sociological jurisprudence and policy oriented jurisprudence. In 
Natural Law theories moral principles and ideais are considered as the 
objective standards of the evaluation of legal orde,r Ol' definite laws and 
as crucial_ tests of the validity af 1egal norms. On the ground of these 
theoTies there is a deontological relatian between law and moral :principles, 
which are the foundations of legal 'Order and standards of critical evalua- 
tion of positive law. In sociological jurisprudence and in policy oTiented 
ju1'isprudence the relation between legal norms and moral values is 
conceived as a teleological one and is formulated in terms af instrumental 
rationality. The values are considel"ed as the ends which should be achie- 
\red by legal means. The objectivity of these values is pretended to be 
pmved by scientific tests. 
In Mc :Douga11's and Lasswell's theory one can distinguish two notions 
of law: a broad one which includes three elements namely law in books, 
legal decisions and values and a narI'OW cancept which ćovers only law 
in books and legal decisions. 4 On the ground af this theory values are 
intrinsic to the broad cancept of law but within this concept they are 
clearly extrinsic in relation to the n
:mrow notion of ław, which is fully 
conformable with the commonplace juristlc understanding of law. Law 
in books and legal decisions are considered as marally ne'utral means 
useful and apropriate for the a'chievement of the extrinsic maral values. 
3. The period of sixtieth and seventieth is the period of a sweeping 
crisis of .american legalorder and of moral values which have been 
leadti.ng values of american society. This crisis has become a new powerful 
stimulus for the philoso:phical discussions on law and morals. 5 The Tela- 
tions between law and morais became the' central topic of contemporary 
american legal philosophy. The discussian focused the crucial philosophi- 
cal prablems involved by these relatians. 
I will not consider all the views, dealrl.ng with a11 problems conerning 
law and morais, which have been discussed in contemporary american 
legaland philosophical literature. Particularly I will not analyse the 
controversies concerning law and moral pluralism (r,yhich is linked wii.th 


ł M. Me D o u g a II, Law as a PTocess of Decision: a Policy Oriented AppToaeh 
to Legal Study, Natural Law Forum, 1/1956, p. 57-60. 
s See Is Law Dead?, ed. by E. V. R o s t o w, New York 1971; Ch. A. Re ie h. 
The GTeening of AmeTiea, New York 1970. 


\
>>>
48 


Wiesław Lang 


sociological r'e1search) Ol' Kantian Ve!l'SUS uti1itarian critea-ia af the mOTal 
estimation of law and the relations between law and justice (whd.ch 
involve the analysis of John Rawl theory of Justtce). These are very 
stimulating topies, deserving separate penetrating inquiries. 
I will concentrate my inquiry on the contooversies coneerning folIow- 
ing topies: the axiological neutrality of la1w, the conceptual separation of 
law and morais, the moral criteria of the validity of law, the validity of 
morally bad laws, and the moral obligation to obey the law. I will not 
go into details in my analysis but I will try to consider the fundamental 
philosophical issues. 
4. The authors who contributed mostly to the philosophical disscussion 
on law and morality in United States in the course of last two decades 
were L. FulIer, L. A. Hart and R. Dworkin. 
Hart is not an american philosopher but the great impaet of his 
writings on recent development of american legal philosophy is undoubt- 
, ful. Hart - Fuller 'contooversy and Hart - Dworkin controversy were 
the most. comprehensive and penetrating de'bates ori. law and morality in 
contemporary western legal and ethical philosophy. 
Fuller developed his concept of law already in the fourtieth and 
fiftieth but his views gained greatest publicity in United States in sixtieth 
and his fundameptal work (The Morality oj Law), in which hepresented 
fully his natural thoory oi law, appeared in 1964. Let us remind in few 
word s Fuller's leading ideas concerr1!ing the relations between law and 
morality. Fuller defines law "as the enterprise of subjecting human con- 
duct to the governance of rules" ...6 "this view treats law as an activity 
and regards a legal system as the product of sustained purposive effort".7 
This 1S not an instrumentalor utilitarian concept óf law. Law is regar- 
ded not as, means suitable for achieving some extrinsic goals but as the 
produet of pUI1posive human activity. The purpose of law is intrinsic to 
the concept of law. 
FulleT's theory of law has been called multidemensional natural law 
theory.8 He distingui:shes substantive natural law and procedura l natural 
law. He identifies !the su'bstantive naturallaw with the external morality 
oi law and procedural naturallaw Wlith the internal mOTality of law. 
Substanwve natura l is rełated to the essential features oi 1iuman natuTe. 9 


· 
. L. F u Ile r, The Mora!ity oj Law, Revised Edition, Yale University Press 

6

1_ . 
7 Ibid. 
sD. S t u r m, Lon Fuller's Mu!tidemensiona! Natura! Law Theory, Stanford Law 
Review, vol. 18, 3/1966, p. 613, 639. 
9 L,L. F u 11 e r, op. cit., p. 181-185; L. L. F u 11 e r, American Legal Philosophy 
in Mid Century, Journal of Legal Education, 6/1964, p. 473.
>>>
Debate of Law and Morality in Contemporary... Philosophy 49 


The crucial and the most original part of Fuller' s theory seems to be 
the concept of the internal morality of law conceived as procedural 
naturallaw. This concept is a real novelty, which diffe!l's F'uller's theory 
f Tom other naturallaw theories. AcOO!l'ding to this roncept a set of mQral 
values and principles is intrinsic to law defined as an institutional system 
of general rules governing human behaviors. These principiesand values 
are the elementary rules and requirements af the lawmaking and law 
administration, which are absolutely necessary for the existence and 
working of every legalorder. The connectJiom between positive law and 
its internal morality is a necessary one because it is warranted by some 
essential farmal features of legalorder. 
The connection between positive law and substantive natural laws 
is in Fuller's theory a very camplicated set of Telations. Positive law must 
be conformable anly with Borne few principles of substantive naturallaw, 
which constitute the moral foundations of legalorder and condition of its 
real existence. Besides these few principles there is only a contingent 
connectian between substantive naturalla:w and positive law. The positive 
law can implement only these principles af substantive naturallaw, which 
are confoTmable with the internal morality of law ,(procedurial natural 
law). 
Internal morality of law is amorality which makes law passible. 
Procedural law plays a rale of a selective intermediate Ibetween positive 
law and substantive naturallaw, but it is neutral in relatian to a broad 
array af substantial aims and ideals af substantive naturallaw. 10 
Most of, princilples and ideas of substantive naturai law are extrinsic 
to law. They can be used as the stan
ards of the moral evaluation of law 
or as the guidelines of the interpretation of legal norms. 
Within Fuller's theory law is implicltly morally laden notian. Axio- 
lagically bound canception of la:w ensuins from the accepted by Fuller 
definitian af law as well as from the idea af internal morality of law 
(which is intrinsic ta positive law). Law must be good enaugh to be law 
at a11. 11 La'ws is a normat'ive order of buman ronducts. Aocording to 
Fulle,r' s views there is a necessa:ry 1ink between the notians of order and 
goadness.12 Therefore the concept of order contains a moral element. 
Fuller challanges the applicability of the logical dichotomy of "is" and 
"ought" and of the epistemological dualism of fact and v.alue to the 
intellectual perception of legal phenomenen, pa'rticularly ta the iperception 


10 L. L. F u II e r, The Morality..., p. 153. 
11 Ibid., p. 39; Rejoinder to Professor Nagel, Natural a Law Forum, 3/1958, 
p. 91-92; The Law in Quest of itself, Boston: Beacon Press 1966, 'p. 1-11. 
12 L. L. F u II er, Positivism and Fidelity to Law - A Reply to Professor Hart, 
Harvard Law Review, 71/1958, p. 363, 636. 


",
>>>
50 


Wiesław Lang 


of the relation between law and social reality and between law and 
morais. 
He challanges also the possibility of the separation oi law and morality 
in the process of the intellectual pereeption Ol' interpretation of law. It is 
not possible to separate conceptualy a law, "which reaJily is" from a law 
"which ought to be" in view of moral values intrinsic to law. 
Fuller criticises violent1y the positivistic concept of law and posi- 
tivistic theory oi the relations between law and morals but he also rejects 
the traditional concepts of naturalla:w as a law "oi higher order" situated 
obove the positive law. 
Similar views on relations between law and morality we C8n find in 
writings oi Philip Selznick, who develops a sociological concept of natural 
law. 13 Also Selznick tries to prove on the ground of sociological argumen- 
tation that there is a necessary link between law and some objective 
moral standard s and values (labeled as natural law). Selznick supports 
Fuller's concept of the intemal morality oi Law but his own theory of 
the relations of natural andpositive law is less sophisticated than Fuller's 
theory. A:ccording to Selznick positive law (enaoted ,by thestate's agen- 
cies) and naturallaw, which can be discovered by reason and sociological 
investigations are the necessa,ry interdependent elements of a normative 
system (which is a broader notion). 
More traditional :natu.ral ław theory ,represents Edgar BodenheimC!l'. He 
conceives law as a synthesisof oroerand justice. 14 And the concept of 
order is also in B
denheimeT1s views a morally lade:n notion. 
The natul'al ław concepts espe:cially the theory of L. L. Fuller became 
the object oi a radical cmticism developed mainly by the representatives 
of the positivi!stic philloS01phy. The main o:ponents of Fuller were: E. Nagel, 
L. A. Hart, M. Cohen, R. Dworkin and R. Summers. The di'scussions 
between Nagel and Fuller published in Natural Law Form and between 
Hart and Fuller published in Harvard Law Review were the most 
specta'cular confrontations of the positivisticand naturallaw phi1osophies 
in contemporary Iphilosophy oi law. 15 
Three iundamental claims oi Fuller were made the targets of critical 
attacks namely: t4at, there is a nece.ssa!l'y merger of fact and. value and 
oi "is" and "ought" in the proces s of theperception of social reality, Jhat 
lawmaking requires obedience t.o the internal morality of law and that 


18 P. Selznick, SocioZogy and NaturaZ Law, Natural Law Forum, 1/1963. 
14 E. B o d e n h e i m er, Jurisprudence. The PhiZosophy and Method of Law, 
Cambridge, Mass. 1971, Harvard UniversityPress, p. 246-276. 
15 L. L. Fuller, Human Purpose and NaturaZ Law. Natural Law Forum 3/1958; 
E. N a g e l, On the Fusion of Fact and VaZue. A Reply to Professor FuZZer, Natural 
Law Forum,' 3/1958; L. L. F u II e r; A Rejoinder to Professor NageZ, Natural Law
>>>
Debate of Law and Morality in Contemporary... Philosophy 51 


there is a necessary substantive connection be'tween law and mOTality. 
Nagel presented a penetrating methodological critique of Fuller's theory 
of law and morals, challanging Fuller's contention on the necessary 
merger of fa,ct and value in the process of the perception of law. Accord- 
ing to Nagel this contention is based on a tautology.16 " 
AU mentioned obove critics of Fuller's theory contend that Fuller 
confuses morality with efficiency. Ha'rt argues that the principles of 
internal morality of law are not moralprinciples but prindples of good 
craftsmanship, which "ar e independent of the law substantive aims just 
as the principles of the carpentry are independet of wether the ca'rpenteT 
is making hospital beds or turtures Tack" .17 Poisoning is without doubt 
a purposeful ac t ivity and has alsosome internal princip1es, making tbis 
activity effective, but it makes no sense to calI these principles the 
internal morality of poisoning. 
Similarobjections have been formulated by Cohen, Summers and 
R. Dworkin. 18 Summers and Dworkin are ready to admitt that the 
ignoring the requirements of internal morality of law may lead to mOTal 
wrong. But this does not entail that these requirements express moral 
principles; the immorality arises from violating some other princiLple 
which is a moral principle.1 9 "A way to violate a moral principie is not 
itslef a moral prin
iple" - writes Summers. 20 
It is not the aim of this paper to decide who is right in this dispute. 
My analysis of the controversies has rathel' a metatheoretical characte!l'. 
But it seems that the mentioned above objections against Fuller'g theory 
are not definitely conc1usive. Strong arguments s\lJpporting Fuller's 
position have be en also fOlrmulated. Peter P. Nicholson indicates that the 
assumption of Fuller's theo'ry
:s not the view that "an ought" statement 


Forum, 3/1958; E.. N a g e l, Fact, Value and Human Purpose, Natural Law Forum, 
1/1959; A. H a r t, Positivism and the Separation of Law and Morals, Harvard Law 
Review, 71/1958; L. L. F u II e r, Positivism...; L. A. H a r t, Book Review. The Mo- 
rality of Law by L. L. Fuller, Harvard Law Review, 78/1965. 
18 E. N a g e l, op. cit., p. 31. 
17 L. A. H a r t, Book Review..., op. cit.; see also 
. A. H a r t, Positivism, p. 59g...:.. 
629. Compare the critical analysis of the discussion: P. P. N i c h o 1 s o n, The internat 
morality of law: Fuller and his critics, 83 Ethics 307, 1979...:..1974. 
18 M. C o h e n, Law, Morality and Purpose, Villanova Law Review, 10/1965; 
R. S um m e r s, Professor Fuller on Morality and Law, Journal of Legal Education, 
18/1966, p. 129; S. I. S h u m a n, Legal Positivism, !ts Scope and Limitations, De- 
troit 1963, p. 89-93; R. D w o r k i n, Philosophy, Morality and Law - Observations 
Prompted by Professor Fuller's Novel Claim, University of Pennsylvania Law 
Review, 113/1965, p. 67
675. 
, 19 P. P. N i c h o l s o n, op. cit., p. 313. 
90 R. S u m m e r s, op. cit., p. 130.
>>>
52 


Wiesław. Lang 


ean be dedueed form "is" statements, but that there is a class of state- 
ments relating to social institutions or practiC€s, such as promising, whe:re 
the faert - value dichotomy i,s inappHcable. 
In this class we start with statements which merge fact and value in this sense 
that they are classifiable as neither factual nor evaluative, and in which value sta- 
tements are analitically contained,21 


5. Hart, as weU as other critics of Fuller challange Fuller's eontention 
about a neeessaJry eonneetion between law and morality. But in his 
fundamental worrk The concept oj Law Hart also develops such an idea, 
however he underpinns it with different type argumentation. 
There a!l'e three sensesin which the rela tions between law and mora li ty 
are considered as necessary connections within Hart's theory. 
1) Fivst, there is a necessary eonneetion between law and mora lity at 
primitive stages of the evolution of law where Law is defined in terms 
bf eertain primary rulesof obligation but where there are no secondary 
rules of obligation. . 
2) There is a necessary connecmon between law and morality in the 
sense that "natura l nec es si ty" (the nature of man and the eonditions of 
survival) is the ground Ol' presupposition for the minimum forms of 
proteetion for persons,property, and promises. This conneetion leaves 
open that law may be unjust Ol' immoral in the broader sense of morality. 
Furthermore, the "naturai neeessity" is itself eontingent. Man and the 
world cou1d have been otherwise and may in fact yet change, in whieh 
ease those form s of prot'ection would no .longer be se€n as indispensible 
for eitheT surviv:al Ol' quality of human existence. 
3) To the extent that morality is rule-oriented (and even an existen- 
tialist' like Sarteagrees to this) , it necessarily inc1udes what might be 
called the "minimum form of justice". The rules may be unjust. They 
mayembody irrelevant criteria for the differential treatment ofpersons. 
But, as rules, they are by definition applicable to aU simila'r ersons in 
similal' ci!rcumstances (even if in fact they are tl.njustly applied). This 
component of justicę and morality is shared by any legal sy,stem Or any 
law. TheTefore, in this sense there is a necessary connection between law 
and morality" . 22 
The most important is the seeond type of neeessary eonnections which 
Hart calls "a minimum eontent of 'natural law".23 AlI other possible 


11 P. P. N i c h o l s o n, op. cit., p. 319-320. 
22 W. T. B l a c k s t o n e, Law and MoraIity: The Hart Dworkin Debate and alter- 
native, Paper presented at the World Congress on Philosophy of Law and Social 
Philosophy Sydney-Canbera, August 1977, p. 1-3; L. A. H a r t, The Concept..., 
p. 84, 189-194, 202. 
28 L. A. H a r t, The concept..., p. 189-194.
>>>
Debate of Law and Morality in Contemporary... Philosophy 53 


substantive connections between law and morais are according ta Hart 
cantingent relatians. There is alsa a causal connection between law and 
morality but it is not the object of philosophical discuss
on. 
Ronald Dworkin develops a cancept of law whtch is also opposed to 
Fuller's idea af the internal morality af law, but which goes far beyond 
Hart's typology of necessary and contingent cannections between law 
and morality. Dworkin considers rule oriented account of law as inade- 
quate. According to Dworkin law is compTised not simply of rules but 
also policies and. prindple. 24 These acr:e mora l prindples tao. There is 
a necessary lirik between law and marality hecause at least some moral 
principie are bydefinition the intri:nsic ingriedients of ław. But these are 
not only moral principles which HaiI't consider,s as "rrecessarily connected 
with law" (the !l'ules of farma l justice and the principles labeled as "the 
minimum content of natural ław"); Dworkin maintains that such prin- 
ciples as freedam, dignity and fa'irne,ss, which, according to Hart have 
only a cantingent oonnection with law, are part iof the law.. "The Tule 
which violate these principles can to be shown not to be law, far theyare 
far morefundamental than any !l'ules. It follows that immaral rulescannot 
be law on this assumption".25 Dworkin's theary cannot be qualified a na- 
turallaw theory, however the practical implicatiions af his reasoning are 
very close ta the conc1usions which :a!l'e being reached on the grounds of 
naturallaw concepts. But Dworkin's theory "if true would establish only 
that there is an ideal consensus and a necessary connectian between law 
and mOTa lity within each legal system. But it leaves 'Open the possibility 
that the principles of ,different societies, hence their law and marality, 
may differ enormously. Na canceptual lin:k between law and univeTsal 
principles of morality i's established".26 
Dworkin considers american legal. order as the prroper frame of refe- 
rence af his theory. He argues that American Constitution farmulates 
some essential moral values and principles, which are intrinsic values of 
american law. 27 These values imply the recognition by legalorder of the 
moral rights of humanbeings. On the ground of Dwa'J:lkin's theory the 
idea of moral rights is a determinative element af his concept ar legality. 
Dwarkin insists that the accept'ance of this idea as a necessary condition 
for "taking rights seriously". 


24 R. D w o r k i n, The Model of RuJe, University o:f Chicago Law Review, 
35/1967. 
.; W. T. B l'a c k s t o n e, op. cit., p. 13. 
28 Ibid., p. 15. 
27 R. D w o l' k i n, Taking Tights seTio'ILsly, [in:] Is Law dead...?, ed. E. V. R o- 
s t o w, p. 168-193; On not pTosecuting civH disobedience, [in:] CivH Obedience and 
VioZence, ed. J. G. Murphy, The University of Arizona 1971, p. 114, 125-126.
>>>
54 


Wiesław Lang 


Dworkin's concept of law and his theory of relations between law and 
morality involve paramount consequences in different fieldsof legal 
theory and jurisprudence. It affects seriously the problem of the role of 
moral standards in the process of interpretation of law and in judical 
decision making, the problem of legal rersponsability, civil rights, the 
moral obligation of the obedience to law and justification of civil deso- 
bedience. In the field of the judicial decision making, Dworkin contends 
that the moral standards, intervening in this process, particulady in the 
sphere of judicial discr'etion, are not established Ol' created by judges, 
who decide the cases, but are discovered and declared by them as 
objective basis of their decisions. 2 ,8 
Dworkin's theory concerning relations between law and morality was 
criticised by L. A. Hart, irom the point oi view of his own concept of 
law. Hart challanged the main contentions oi Dworkin, especially his 
contention that judges discovel' the moral principles which influence 
judicial decisions. 29 
6. The careiul analysis of Hart, - Fuller - Dworkin debates on law 
and mora lity reveals that the contradictions between new versions of 
naturrallaw thoory and legal positivism have been oonsiderably reduced, 
The claims oitraditional metapJ;1ysical theory oi eternal and uchangable 
law-,.Oi naturre have been ,challanged and rejected not only by.legal posi- 
tivist but also by the proponents oi the new versions of natural law 
theories. On the other hand all parties oi the di!spute agree that therre arre 
causallinks and some necessary substantive connedions between law and 
morality. Fuller's contention that the concept oi law contains necessarily 
some mOTal e1ements may be also maintained within Hart's and Dwor- 
kin's theorry. Ha!l't's c1aim that law is "unfortunately compatible with 
a great deal of iniquities",30 is arguable also within Fuller's theo,ry oi the 
intexnal mora lity of law. Hart',s objection against this theory that one can 
meet requilI'ements oi mternal mora lity of law and still make mOl'ally 
bad laws is not a per,suasive argument. IJaw can be e%luated irom the 
points of view oi different morral va'lues and standards. Law can be consi- 
dered as good irom the point of view oi the pTindples of internal 
mora lity but at the same time it oan be evaluated as bad from the point 
of view of some external moral values. 31 


, !8 R. D w o r k i n, The Philosophy of Law, Introduction, New York 1977, p, 6-9, 
149-200; i d e m, Hard Cass, 88, Harvard Law Review, 6/1975, p. 1057-1109; id ero, 
Seven Critics, 11, Georgia Law Review; 5/1977, p. 1201-1268. 
Ił L. A. H a r t, Law in Perspective oj Philosophy, New York University Law 
Review, 51/1976. 
lO I d e m, Book Review..., p. 202. 
.1 P. P. N i c h o l s o n, op. cit., p. 321.
>>>
Debate oi Law and Mor1lity in Contemporary... Philosophy ,55 


The controversial issue is not wethel' some necessary connections 
between law and morality da exist, but what kind of nioral principles are 
intrinsic to law and what cansequences ensuin from theexistence af such 
connections. The crucial testing points af thediscussian are the próblem 
of the validity of bad lawsand the maral Oibligation ta obey the law. 
According to Fu11er law which violates the principlels of internal 
marality is nat law at a11 and there is no moral db!tgation to obey such 
commands.32 Hart argues that also a mora11y bad law is law (in a sense 
in which term "law" is norma11y U'sed) but there can be some oveTriding 
moral reasons which can justify thedisobedience to such law Ol' even 
may uderpinn the moral abligation to disobey the immorallaw. 33 It seems, 
that this cantraversy is deprived of a practical significance. This is always 
a situation of a maral conf1ict. In some hard ca'ses decided by caurts ar 
in which a decision i,s required from the citizen the concept of Fuller 
may be a good reason for action,but in another cases the ooncept af Hart 
may prave ta be more reasonable 'saluti'On of moral 'Ol' legal problems. 
However the problems of the validity of law and moral 'obligatian 
of the abedience to law remain the real position in the c'Ontroversy 
between natural la
 theories and legal positivism cancerning relations 
between law and morality. But the cantroversial. issues mean different 
interpretations of the contention c'Oncerning necessary connection between 
law and morality. 
The inteI'pretation intrinsic to the concepts of law of Nature i's a deon- 
tological interpretation. Acc'Ording to this inte
retation the thesis about 
the necessary correlation between law and a certain catalaque of moral 
values is theproof af the abjectivity af tIh
t cataloque of values, and is 
a premise from which it is possible to derive by way of implication the 
,legal norms being in force, Ol' justify the moral obligation of the obser- 
vance af Law. Within Fu11er''S theory the inner marality af law is regaT- 
ded as the justification of the moral principie of the fidelity ta law. 34 
The representatives of the positivistic approach to law and marality 
challange andreject this interpretation as implying naturalistic fa11acy. 
Hart, Dworldn and Summers are arguing that inner morality of law 
cannat by considered as a premise :łJrom which the moral abligation to 
obey the Law (ar the obligation to the fidelity to law) may be drawn. 
The positivistic interpretation is strictly empirical and hypothetical. The 
empirical verification of the hypothesis claiming that there are some 
necessary ponnectians between law and m'Orality has no deontaligical 


&I L. L. F u 11 e r, The Morality..., p. 180. 
8. L. A. H a r t, The Concept..., p. 195-207. 
Ił L. L. F u 11 er, The Morality..., p. 172.
>>>
56 


Wiesław Lang 


significance, hence, does not constitute any se1fcontained basis ofthe 
validity of law Ol' of the moral obligation of theobedience to law. The 
deontological interp!l'etation of this hypothesis is possible only on the 
ground of a legalistic ethos. 
The real controversial problem seems to be also theproblem of the 
moral neutrality of law and the separation of law and moraIs. But the 
discussion has also made elear that the contention that law is a. morally 
bound notion must not be incompatible with the claim that. in a plura- 
,listic society law may be neutral i:n relation to some conf1icting moral 
values. 
The problem of the moral neutrality of law is also not identical with 
the question of the separation of Law and Morais neither in ethical nor 
in metaethical piane. The view that Law and Moral,s are two distinct 
forms of social controi and should be conceptually serparated in the 
process of the interpretation of Law Dr in the courSe of soci?logical 
investigations of legal institutions - does not imply necessarily the 
view that the notion of Law is mOJCally neutral. Also the view fuat Law 
is linked with Morality in the sociological piane does not entail the con- 
clussion that theTe must be same moral values intI'linsic to Law. 35 
7. The controversies between of legal positivis:rn and natura l law 
theoriels became the O'bject of philosophical analysis in recent in writings 
of many outstanding american legal philosapherrs. G. Hughes, Helen Silving 
and Jerome Ha1l 36 developed and underipinned the claim that there are 
no rundamental contraditions between contemporary natural law and 
positivistic theO!l'ies of law, particularly as c'Oncerns the relation between 
law and morality. Many of these contradictions proved to be apparent 
or deprived of practical significance. The axiological assumpm'Ous of legal 
positivism were also brought to light. 
These authors tried to overcome the controversies between natural 


85 W. L a n g, Law and Morality from a Marxist point of view, Rechtstheorie. 
Zeitschrift fur Logik, Methodenlehre, Kybernetik und Soziologie des Rechts, 7. Band 
1976, Heft 2, p. 142-143. 
86 J. H alI, From Legal Theory to Integrative Jurisprudence, University of Cin- 
cinnati, Law Review, vol, 33, 2/1964; Foundations of Jurisprudence, Indianopolis 1973; 
H. S i 1 v i n g, Positive Natural Law Forum, 1/1960, p. 25-44;. G. H u g h e s, The 
Existence of a legal system, New York. Law Review, 35/1960, p. 1001-1030; J. H alI, 
op. cit., p. 1-55. There are also rome authors who indicate the substantial differen- 
ces between new version of legal positivism and natural law theories. G. Brecken- 
ridge argues that the disagreements between Fuller and Hart ultimately depend on 
differing views of the nature of man, law and mora lity. Legal Positivism and the 
Natural Law: the controversy between Professor Hart and Professor FuHer, Vander- 
bildt Law Review, 18/1965, p. 945-964.
>>>
Debate of Law and Morality inCoritemporary... Philosophy 57 


law theoryand positiwstic stand and ta prove that. these philosophical 
standpoints are nat the only possible alternatives in legal philosophy
 
AU mentianed aboverecentMneTican theories af law and morality 
exhibit same essential common features which are fulIy congenri.al with 
recent trrends .in cantemporary western ethical pm.lasophy.37 
1) They emphasize the existence af same necessary 'substantive oonnec- 
tions between law and morality. They claim that every legal 'Order con- 
tains and implements same moral values and prindiples. 
2) They try ta prove by using arguments af different kinds, that moral 
values necessarily connected with law are universal values. These are 
the values nec es sary farthe,surviv'al af human beings 'OT far the existence 
af 'Social arganisatian ar far the quality of huma'I1 Nfe. 
3) The catalague ai values, regarded by positivistic and natural law 
thearies as intrinsic to law, is a catalogue of liberal values intrinsic to 
liberal ideolagy (persans, prap€rty, promises, liberty, security, relative 
equality). These aTe clearly liberaI theories. 
4) The Law rl.tself is considered by these theories as a morał value. 
Conequent1y these are dearly legalistic theories. 
AlI these ideas characteristic of modern verions of both positivi:stic 
and natura l law theories have been fulIy e
pressed and developed in 
Jerame Hall's Integrrative Jurisprudence pretending ta overcame the 
cantrove'l',sies 'between legal positivism and Natural Law Philaso.phy.38 
But there is also a c1early antilegalistic trend in contemporary ameri- 
can legał and political philasophy represented by "radical lawyers" .39 
This intelectual trend linked with same versions of marxist philosaphy 
rejects the legalistic ethas and considers the rule of law and principles of 
legalisty aspure myths. The radicallawyers are challanging the li,beral 
and legalistk c1aims cancerning necessary cannectians between law and 
morality. Accarding to their views law is dep!l'ived of any moral values, 
because it is completely indifferent ta ihe maral motives of human 
actions. Morality is regarded as extrinsic ta law. Law is c1aimed to be 
the tool af appression and damination in the hands of the TUling classes. 40 
It may bappen tha:t in future the cantroversy between liberal and 
legalistic philosophy of law and deady antiliberal and antilegali'Stic theo- 


87 See Ph. F o o t, Theories 01 Ethics, Oxford University Press 1967; W. F. F r a n- 
k e n a, The Concept 01 Morality. The Journal of Philosophy, 43/1966; W. F. F r a n
 
k e n a, Ethics. Prentice Hall, Inc. 1973; S. H o o k, Law and Philosophy, New York 
1964. 
88 J. Hall, op. cit. 
89 RadicaZ Lawyers, ed. J. B l a c k, Evon Books 1971. 
40 K. C lok e, Law is iZZegaZ, [in:] RadicaZ Lawyers..., 27-43.
>>>
58 


Wiesław Lang 


ries of law and morality will put a'Side and make point1ess the traclitional 
controvernies ibetween legal positivism and natural law theories. 
It seems to be plausible the hypothesis that the mentioned obove 
tendencies mak e a specific response of recent american legal philosophy 
to the crisis of law and morality in contemporary american socjety.
>>>
ACTA UNIVERSITATIS NICOLAI COP:ERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 1978 


DepaTtment of FOTeign TTade Law 


Jan Łop'Uski 


FOREIGN SOVEREIGN IMMUNITY AND MATRIME CLAIMS 


(WITH 
MPHASIS ON THE LAW AND PRACTICE OF THE UNITED ST
TES) 


c o n t e n t: Rules on loreign sovereign immunity in actions concerning maritime 
claims are consistent with new trends in international law marked by a shift towards 
the restriction of sovereign immunity in case ol commercial operations undertaken 
by a state. In spite ol theoretical divergences between the Socialist and Weste,rn 
jurisprudence, a convergence is noticeable in the practical application ol the immu- 
nity rule. ' 


Foreign sovereign immunity in actions conceI'ning maritime c1aims 
and the specific problem of immunity of sea vessels owned or operated 
'by a foreign state are part of a broader problem Qf foreign sovereign 
immuriity in civil matters. 1 Nevertheless, With regard to certain aspects 
this problem may be distinguished. The European Convention on State 
Immunity of 1972 2 has exc1uded (art. 30) from its application proceedings 
in respect of maritime c1aims, since these matters are governed by 
a separate international agreement. 3 Suits in admh'alty pgainst vessels 
ot a foreign state received a special treatment in the ,U.S. Foreign 
Sovereign Immunities Act of 1976,' and art. 20 of the USSR Merchant 


1 The problem discussed in this article is limited to immunity from civil juris- 
diction and enforcement measures, leaving untouched immunity from administra- 
tive or penal jurisdiction. 
II The Council ol Europe Convention on State Immunity and Additional Protocol 
signed on 16 May 1972. For its text see European Yearbook, 1972, vol. XX, p. 299 fI. 
The Convention entered into lorce on June 11, 1976 upon ratification by Austria, 
Belgium and Cyprus. The Convention has also been signed by the Federal Republic 
ol Germany, Luxembourg, the Netherlands, Switzerland and the United Kingdom 
(1977). 
8 The Brussels Convention on the Immunity ol State-owned Ships ol 1926 as 
amended by the subsequent Protocol of 1934.' 
, International Legal Materials, 1976, vol. XV, No. 6.
>>>
60 


Jan Łopuski 


Shipping Code of 1968 contains a special rule on the immunity of Soviet 
state vessels. It may, therefore, be right1y assumed that in both the 
national and international legislation the sovereign immunity in respect 
of maritime c1aims is treated' as a distinct problem. One C'annot, however, 
disregard its links with new trends concerning sovereign immunity in 
international law and in nationallegislations, since arguments concerning 
immunity of state vessels are derived from the wider principie of foreign 
sovereign immunity. 
For the purpose of this artic1e "maritime claims" in .respect of which 
the problem of sovereign immunity is discussed will mean claims relating 
to the operation of sea-going vessels owned or operated by a state Ol' to 
the carriage of cargo es Ol' passengers by such vessels Ol' to the carriage 
of cargoes owned by a state and carried on board mer
hant vessels, as 
defined by the Brussels Immunity Convention of 1926 and European 
Immunity Convention of 1972. 
It has hen stressed in the writings of international jurists that few 
, topi'cs in the fie1d of international law have given rise to a moTe extended 
analysis and vivid discus!"ion in recent yeal"is than the topie of sovereign 
immunity,5 and of immunity of state-owned vessels in particulaT.6 These 
views are particularly relevant with regard to the jurisprudence of the 
common law countries, where this topie has become a subject of heated 
controversy. According to Lauterpacht,7 most of the material on this 
subjecf has been produced by the munidpal jurisprudenee of states. 
Interesting developments have taken place in the United States where 
the judiciary (including the U.S. Supreme Court) bas latelyproduced 
a consideTable number of deoisions on sovereign immunity.8 The United 
States are also, to the best knowledge of the author,9 the only country 
where the problemof foreign sovereign immunity has beeome the object 
of a comprehensive. internal legislation. For these reasons it is intended 
in this artic1e to give special consideration to the American attitude to 
the próblem in question. 


6 J, M. S i n c l a i r, The European Convention on State lmmunity, ICLQ, 
22/1973 p. 254. 
8 T. K. T h o m m e n, Legal status of government merc:hant ships in international 
law, The Hague 1962, p. 9. 
7 H. L a u t e r p a c h t, International law. Collected papers, ed. by E. L a u t e r- 
p a c h t, vol. 1, Cambridge 1970, p. 481-483. 
8 In the decade 1966-1976 over thirty decisions of .U.S. courts on sovereign 
immunity were reported in American Maritime Cases only; most of them concerned 
maritime claims. 
9 The article was prepared before the publishing of the U. K. State Immunity 
Act 1978.
>>>
Foreign Sovereign Immunity and Maritime Claims 


61 


FOREIGN SOVEREIGN IMMUNITY: GENERAL THEORIES 
AND MODERN TRENDS 


A historical approach to the problem of foreign soverreign immunity 
clearly indicates close links between the prevailing theories relating to 
the immunity of a foreign state and the world political and economic 
situation as existing in the given period. At' the time when. goverrnments 
did not mix into commercial operations the concept of absolute immunity 
was firmly established. It protected states from suits in civil and com- 
xnercial courts of foreign countries, unless immunity was waived, irres- 
pective of the nature of claim on which an action against a foreign state 
was based.' Also in the United States, historically, the absolute the,ory of 
immunity protectedforeign sovereigns from suits in the U.S. courts. The 
. U.S. Supreme Court decision in T h e S,c h 00 n e 'l' E x c h a n g e (1812) 
and the British House of Lords decision inT h e.. P a l' l e m e n t B e l g.e 
(1880) for a long time provided. guiding lines of reasoning, sUippąrting 
theimmunity of vessels owned OT operated by a foreign state in confolJ.'- 
mity with the prindple ofab.solute immunity; they\VeiI'e followed by 
the judiciary of the continental countries, witha !)oteworthyexception 
of Italian courts. / 
But the XX century has witnessed a steady )ncrease ot economic acti- 
vities ofgovernments in international relationships. In the inter,.war 
period this trend, was activated through the a'Ppearance onthe world 
scene of the USSR which introduced a state monopolyof foreign trade 
and nationalised its transport. In various other countries the management 
of key industrie s aDd of transport has come under the responsibility of 
the statE
. More and mor e states have become engaged .in commercial 
activhies. 
The reaction of jurisprudence to the chan gin g situation was divet- 
sified. While the Soviet doctrine st:rongly supported the absolute theory 
of immunity,lO there was also no radical chahge in theattitudeofthe 
jurisprudence of the leading weste:rn powerrs. With regard to the immu- 
nity óf state vessels the judiciary in the United States and in the United 
Kingdom continued to adhere to the princip1e of absolute immunity. In 
the United States the decision of the Supreme Court in the case B e r i z z i 
Brothers v. Steamshrip P,esaro (1926) used t'O be generally 
quoted as a leading case attribut:ing jurisdictional immunity to a state- 
-owned foreign vessel engaged in ordinary oommercial activities. In 


10 For a comprehensive presentation of the earlier Soviet attitude, towards the 
immunity of state and of state-owned property, see L. A. L u n t s, Międzyna1'odowe 
prawo prywatne (Polish edition), Warszawa 1951, p. 225-235.
>>>
62 


Jan Łopuski 


England the COU1't af Appeal decisiOil1 in T h e P o l' t a A l e x a n d r e 
(1919) 'extended the principie established in T h e P a l' l e m e n t B e l g e 
on state-owned vessels used in ordinary commerce. 
While the gavernments of big states did not radically change their 
attitude ta the problem of sovereign immunity, the commercial circ1es 
reacted quiC'kly to the changing cha!l'acter of international ecanomic 
act,ivities 'With sovereigns entering again and again the market place. 
On the initiative of the Internatianal Maritime Committee the Belgian 
Government (generally inclined toward:s the restriction of sovereign 
imnlUnity)l1 canvened in 1926 a, Diplomatic Conference at which the 
Convention on the Immunity of State-owned ShipS12 was signed, The 
Convention restricted the principie of foreign sovereign immunity to 
actionsconcerning warships, certaiinspecified kinds af ships !in public 
service and othe!l' vessels "awned or operated by a State and employed 
exclusively on Government and non-oommerdalservke". Na immunity 
c
u1d be c1aimed in respect of other vessels owned Ol' opera te d by a state. 
In respect of martime c1aims relating to the "commercial activity" the 
state was submitted to the same lega l actionsand claims as a p!l'ivate 
shipowner. Under the Convention the rule of foreign sovereign immunity 
was turned into an exception to the rule of non-immunity in spite af the 
title of the Coovention. And one may natbe astonished that the first 
blaw struclk at the absolute theory of sovereign immunity came from the 
internati
mal legislatian concermng shipping relationships,13 where 
foreign sovereign immunity has ever since caused acute problems. 14 
But the Brussels Convention halS been ratifiedby only a limited num- 
ber of states,15 and the real change of course !beganafter World War II. 
While certain continental countries such aiS Belgium, France, the Nether- 
lands, Italy and the Nordic cauntries indicated their preference for the 
functional concept of 'sovereign immunity already in the inter-war period 
and ratified the Cónventian, in the United Kingdom 'Signals far change 
were given by the criticism of the absolute theory as expressed by Sóme 
members ai the House of Lords when deciding cases on sovereign im:- 


11 G. R i p e r t, Droit Maritime, vol. 1, Paris 1950, p. 696. 
!Z See note 3; The Convention appliesto cargoes as well. The restrictive theory 
of immunity adopted by the Convention was reaffirmed by the I and II Law of the 
Sea Conventions of 1958. 
Ił Actually it took additional 46 years until a general convention on state immu- 
nity giving effect to the principle of functional sovereign immunity has been signed; 
see note 2 supra. 
14 See infra, p. 70. 
lS Some 22 ratifications in 1976; Łhe USSR, USA and Great Britain abstained.
>>>
Foreign Sovereign Immunity and Maritime Claims 


63 


munity;18 on the whole, however, a decisive shift towards the restriction 
of sovereign immunity in the United Kingdom was rather protracted. But 
in 1976 the decision of the Privy Council in T h e P h i l i p P i n e 
A d m i 1'a l gave effect to the restricted doctrine of sovereign immumty, 
empha8iiing that "...the trend of opinion in the woI"ld outside the Com- 
monwealth since the 1ast waT bas been inC!l'easinglyagainst the application 
of the doctrine of sovereign immunity to ordina:ry trading transactions. 17 
In the United States the signal for change came in 1944 from the 
Supa:eme Court justice. Mr. Frankfurter in his criticism of the result in 
B e ri z z i B r o t h e l' s v. St e a m s h i P P e s a r 0.18 In 1952 the De- 
partment of State indicated the adoption of the restrictive theory by the 
U.S. Government. 19 The Foreign Sovereign Immunities Act of 1976 
generally reaffirmed the restrictive doctrine of immunity.20 
International organisations concerned with legal matters were also 
inclined to support the concept of restricted sovereign immunity. It was 
adopted in the resolutions of the International Law Association (1952) and 
of the Institute of International Law (1954) as well as in the recommen- 
dations of the Afro-Asian Legal Consultative Committee (1
60).21 
The Council of Europe Immunity Convention of 1972 22 has incorpo- 
rated rules of non-immunity based on the general concept that immunity 
should not attach to state activities iure gestionis. Thus in the West a fuH 
turnfrom an absolute to a restrictive concept of sovereign immunity 
seems to be completed. 
In the East European 'socialist count1'ies the approach to the problem 
of foreign so'Vereign immunity is diversified both in theory and in 
practice. The absolute theory of immunlity of state and its property do- 
minates in the Soviet legal doctrine, being considered as derivingfrom 
the basic pTinciples of international law such as sovereignty, sovea'eign 


18 In particular speeches of Lord Macmillan in "The Cristina" (1938) 60 Ll.L.Rep. 
147 and of Lord Denning in the RahimtooIa v. Nizam ol Hyderabad 
(1958) A.C. 379 questioning the immunity of foreign states in case of disputes con- 
cerning commercial transactions of their governments. 
11 See (1976) l LI.L. Rep. 234. For a full review of the British doctrine on Bove- 
reign immunity see R. H i g g i n s, Recent developments in the Law of Sovereign 
Immv.nity in the United Kingdom, AJIL, 3/1971, vol. 71. . 
18 R e p u b l i c o f M e x i c o v. H o f f m a n (1944). See H. L a t e r p a c h t, 
International law..., p. 484. 
19 In the socalled "Tate-Letter"; see Dept. of State Bull. 26 (1952), p. 984. 
tO G. R. D e I a u m e, Pv.blic Debt and Sovereign Immv.nity. The Foreign Sovere- 
ign Immv.nities Act of 1976, AJIL, 3/1977, vol. 71, p. 400. 
11 As reported by J. M. S i n c I a i r, op. cit., p. 261-262. 
Ił See note 2.
>>>
64 


Jan Łopuski 


equality and independenC€ of states. 23 The absolute theory f
nds also 
suppoTters among international jurists :6rom 'Qther socialist countries. 24 
The practical effects af a:pplication of the absolute theory in the inter- 
natiQnal economicrelationships of the social'ist countries are, however, 
considerably attenuated by the "impliedwaiver" theary and bilaterai 
agreements(practised mostly by theUSSR). The waiver of immunity is 
implied from the fact that :social:i:st states, whichhave monopaly of 
foreign trade, entrust their functions to state enterprises and eorporations, 
which from the legal and finaneial point of view are separate legal enti- 
tięs and as sueh should not be entitlec;i to immunity.25 In faet many socia- 
list jurists,are £u11y aware of the fact that a strict observance of sovereign 
immunity in the international economic relationshi:psmay do moreharm 
than goad, and some dic;i not hesitate to calI it privi,legium odiosum. 28 
The waiver of immunity fromjurisdiction is not equivalent to the 
waiver of immunity from attachrnent and executionof state property; 
in this respect certain divergences in the theoryand practice ofthe socia- 
list countries have become evident. 
Comparing the theo
etical foundations ofsovereign immunity in the 
legal theory of, East and West We are faced with considerable contro- 
versie'S. While the Soviet scholar s seek the foundations of the absolut e 
doctrice of immunity in thebasic principles of international law, there 
1s a consensus of opinion in the West that theabsolute doetrine has no 
basis in international law; this opinion ils also shared by the int
atio- 
nal arganisations of the developing countries. Lauterpacht, who after a11 
shared theSovietview on the artificiality of the distinction. between acts 
iure gestionisand acts iureimperii, ąuestioned the existence of principle 
Qf international law prahibiting the CQUTtS af one state from e
erdsing 
jurisdictian over another state and supported the principie of non-immu- 


i. Among many: L. A. i. un t s, op. cit., M. M. B o g u s l a v s k Y, Immunitet go- 
sudarstva, Moskwa 1962, S. A. G u r e e v" Soveremennoe meżhd'L!.narodnoe morskoe 
pravo, Moskwa 1978, p. 144. 
14 See VI-e Congres de I' Association Internationale des Juristes Democrates. 
Travaux de la Commis'sion de Droit International Prive, 1956; J. S u t o r, Przywile- 
je i immunitety międzynarodowe, Warszawa 1973, p. 24-25. 
15 J. S u t o r, op. cit., p. 26. 
" J. G 6 rs ki, Note, Państwo i Prawo, 5/1972, p. 115. Polish foreign trade and 
shipping state enterprises do not claim immunity from judical attachment or juris- 
diction of foreign. C01.1rts.For a more comprehensive review of the jurisprudence of 
East European socialist states on the problem of immunity of state enterprises see 
11. Jak u b ow s k i, Immunitet prżedsiębiorstw państwowych, Studia Prawnicze, 
'17/1967, p. 114-118. He indicatesthat the trend of opinion is against according juris- 
dictional immunity to state enterprises which are separate legal entities. The position 
is less elear as regards the immunity from attachment or execution. as it depends 
on the legal status of state enterprise's property.
>>>
Foreign Sovereign Immunity and Maritime Claims 


65 


nity of state subject to certain well-defined exceptions. 27 Although Lauter- 
pacht'sextreme . concept has found little support with other writers as 
well as with the makers of the European Immunity Convention (which 
considers no-immunity cases as exceptions to the rule of immunity), in 
view of the latest developments in the West it is rathel' dou'btful whether 
there is such a common rule of international law on which the absolute 
doctrine of sov€'reign immunity could be based. In theWestern legal 
theory, court practice and even domestic legislation, sovereign immunity 
as a principle of international law has been definitely narrowed to the 
immunity of state acting in the exercise of its sovereign pow er Le. outside 
the sphere of private law relationships.28 This imposes, however, the 
ungrateful but unavoidable task of making distinction between acts iure 
imperii and acts iure gestionis. 


. THE PROBLEM OF CLASSIFICATION 


The principie of sovereign immunity has for long been considered as 
based on a general duty to respect the independence, equality and dignity 
of states 29 and as such belonging to public international iaw. This view 
on the foundations of sovereign immunity is consequently maintained 
in the Soviet legal writings. 30 But considerable difficulties encountered 
in establishing the exact content of the rui e of international law on 
sovereign immunity31 gave rise to a wave of criticism aiming at the very 


27 H. L a u t e r p a c h t, The Problem of Jurisdictional Immunities of Foreign 
States, BYBIL, 28/1951, p. 220 ff. See also H. L a u t e r p a c h t, International Zaw..., 
p. 485, where he suggested a general restriction of state's jurisdictional immunity by 
international legislation. 
28 The U.S. Foreign Sovereign Immunities Act of 1976 in 
 1602 (Findings and 
tieclaration of purpose) states bluntly: "Under international law, states are not 
immune from the jurisdiction of foreign courts insofar as their commercial activities 
are concerned, and their commercial property may be levied upon for the satisfac- 
tion of judgments rendered against them in connection with their commercial actfvi- 
ties". Compare ais o the preamble to the European Convention which expresses the 
views of an important gro up of West European states on the problem of state 
immunity under internati
nal law. 
29 This view largely accepted in the earlier jurisprudence has been invalidated 
in the last decades. The main attack against these foundations of the principle of 
sovereign immunit
 come from Lauterpacht who indicated that only dignity might 
form the basis of states immunity, but considered it as aD archaic concept dat ing 
from the period when the sovereign hpd been placed above the law. For a recapitu- 
lation of Lauterpacht's views see T. K. T h o m m e n, op. cit. p. 17. 
ao See supra, p. 63. 
81 On the failure of the so-caUed "SomerveIl Committee" in the United Kingdom 
to establish the exact position of sovereign immunity under international law, see 
J. M. S i n c l a i r, op. cit., p. 261.
>>>
66 


Jan Łopuski 


foundations of sovereign immunity. The more reeent decisions of British 
and American courts have not referred any more to the notion of "abso- 
lute independence",32 but have described the obligat
on to grant jurisdk- 
t'ional immunity as f1,owing from "international 'comity" , which - as 
indicated by Lauterpacht - is a notion widely aJpplied in private interna- 
tional law. 33 Since the international prineiple of sovereign immunity is 
reflected in the rules of nationallaws coneerning the jurisdiction of eourts 
in civil matters,34 from the point of view af juridical systematization this 
problemseems to be situated in the borderland of different sph€r€s of 
law - pubHc international law, private international law, civil proeedure 
and even administrative law. 3s In faet the problem of sovereign immunity 
coneerrns rights af individuals against H fOTe
gn state; s.ince in many 
modern legal systems ;tates submit their agencie s to legal liability and 
jurisdiction of civil courts,36 they may nat be inclined ta grant immunity 
to agencies of foreign states. It has even been suggested that state im- 
munity may appeal' as a doetrine of non.;.jus1Jiciability ratherthan an 
immunity in a strict sense. It has clase funetional links with conf1ict of 
laws, since it concerns the competenye of national courts and executorry 
organs as well as of proeedurallaws applied by them in the international 
private law relationships. !ts theory has evolved much latęr than the 


8! See the remark of J. L. B r i e r l y, The basis of obligation in international 
law, Oxford 1958, p. 369, that absolut e sovereignty and international law cannot 
exist together,which may sound shocking for some international jurists. In view of 
the growing interdependence of states it seems, however, to be very pertinent. 
'3 H. L a u t e r p a c h t, International law..., p. 481--483. See also the U.S. Supre- 
me Court in F i r s t N a t i o n a l C i t Y B a n k v. B a n c o N a c i o n a l d e C u b a 
1!}72 AMC 1379 et seq. 
84 This link between international law and domestic law on civil jurisdiction was 
stressed in the House of Lords decision in the "Crilstina" (1938). In his speech lord 
Macmillan caIled the principIe of sovereignimmunity "an importation from interna- 
tional law" (J. M. S i n c l a i r, op. cit. p. 258), 
35 While in the American, British and Soviet jurispntdence the problem of 
foreign sovereign immunity preoccupies mainly international jurists and specialists 
on prlvate international law, in some other countries it is generaIly considered as 
belonging to the sphere of civil procedure or even administrative law (executional 
immunity); see W. Wen g e rek, Immunitet egzekucyjny państw obcych, Studia 
Prawnicze, 17/1967, p. 124. This may be due to the fact that codifications of civil 
procedure contain some more or less fragmentary regulations on immunity (see 
art. 1111-1116 of the Polis h Code of Civil Procedure on the immunity of diplomatic 
and consular representatives of foreign states). 
341 See art. 33 
 litem 1) and art. 34 of the Polis h CiviI Code of 1964 according 
legal personality to the State Treasury through which the State acts in civil-law 
relationships. The USSR and its republics act through "state institutions and orga- 
nizations" endowed with legal personality (art. 11 of the Principles of Civil Legisla- 
tion of the USSR and Soviet Republics).
>>>
Foreign Sovereign Immunity and Maritime Claims 


67 


conf1ict of laws theory but under the influence of very similal' main 
trends of thought - from the universal concept of Savigny looking for 
its foundations in the priciples bf the law of nations to the national 
doctrine considering it as a matter for internal legislation. This latter 
doctrine seems now to prevail but stress is laid on the necessity to meet 
the requirements of international peaceful co-existence and to undertake 
parallei efforts to find uniform solutions by way of international legis- 
lation. 37 
By denying the foundations of immunity of foreign sovereigns exercis- 
ing commercial activity in the law of nations, the American Act of 1976 
has treated it as a problem for domestic legislation determining the scope 
of juri
diction of American courts. Consequently questions whether Ol' 
not a foreign sovereign is engaged in commercial activity will be appraised 
by American courts with reference to the provisions of the 1976 Act 
which eontains relevant definitions. The view that lex fori shouLd be 
competent for the determination whether or notanact 18 Ol' is not, an 
act of soverei:gn authority, widely aecepted iri the Western theory,38 i5 
strongly questioned by the sodalist jurisprudence, whieh eonsiders it as 
violating the principle of sovereignty.39 


SOVEREIGN IMMUNITY AS A POLITICAL ISSUE: AMERICAN PRACTICE 
UNDER THE "T ATE LETTER" 


The American praetice in treating claims of foreign sovereign im- 
munity was for a very lon g period based on the assumption of a close 
relationshtp between foreign policy and recognition of immunity of 
a foreign state by American courts. 40 Consequently thę American eourts 
consistently recogni'zed foreign sovereign immunity when requested to do 
so by the Executive Branch, without reviewing the executive's determi- 


87 J. B r o w n l i e,Principles of pub lic international law, Oxford 1973, p. 327; 
he suggests that any state may at its discretion enact domestic laws governing the 
immunities of foreign states, respecting the general international principleson juris- 
diction of state (such as requirement of close connexion); this is what the United 
States actuaUy did in 1976. 
88 J. M. S i n c l a i r, op. cit., p. 261-264. 
89 J. H a a 1 c'k, Zur Immunitćit der staatlichen Seeschiffe, Wissenschaftliche 
Zeitschrift der Universitat Rostock, 11/1962, p. 144. According to the socialist theory 
aIs o the exemption of state entities from immunity is governed by their national 
law (E. Wen g e rek, op. cit., p. 145), which seems unacceptable under the American 
Act of 1976. 
40 The U.S. Court of Appeals 1974 A M C p. 287 et seq. ("Imias") referring to 
160 years of American Courts' practice of applying the doctrine of sovereigń im- 
munity in conformity with the suggestions of the Executive Branch
_
>>>
68 


Jan Łopuski 


nation. In doing so the courts relied on the doctrine. of separation of 
powers under the American Constitution, which required the court to 
assume that a11 pertinent considerations had been taken into account by 
the Secretary of State in reaching his conclusion. 41 However, the practice 
of seeking advice of the State Department before reaching decision by 
the court on the foreign sovereign immunity question might not always 
have been a common one. 42 
The State Department's policy has evolved slowly from an absolute 
to a restrictive concept of sovereign immunity. Although same point out 
that the Department has be en folIowing a policy of restrictive immunity 
since as early as 1916,43 the adoption of the restrictive theory by the 
U.S. Government had not been c1early formulated before the so-called 
"Tate Letter".44 
The practice of American courts in applying the "act of state" doctrine 
up der the "Tate Letter" led to the actual removal of decision in questions 
of foreign sovereign immunity from the competence of judiciary to the 
State Department fo11owing a conceptual distinction between "jurisdic- 
tion" and "justiciability" .45 It has even been stressed that in foreign 
affairs, where the success of a legitimate . policy may depend on secrecy, 
disc10sure of the reasons for recognition of a c1aim for sóvereign immunity 
may itself defeat that policy.46 The certification and the request of the 
State Department that the vessel be dec1ared immune had j to be accepted 
by the courts as a conc1usive determination by the political arm of the 
U.S. Government that the continued retention of the vessel interfered 
with the proper conduct of foreign relations. 47 , 
In practice the State Department procedures provided for acceptance 


41 1961 A M C 1951 (R i c h. v. N a v i e r a Va c u b a S. A.) referred to in 
"Imias". 
42 H. L a u t e r p a c h t, International law.... p. 484. 
48 T. K. T h o m m e n, op. cit., p.40. This is, however, questioned by other 
sources; see W. E. H o l d e r and G. A. B r e n n a n, The International Legal System, 
Sydney-Melbourne-Brisbane 1972, p. 593. 
« See not e 19. supra. The State Department referred to the shift in the theory 
and practice of a number . of 'countries and to the necessity of providing judiciary 
protection for persons engaging in commercial activities with foreign states as 
motives of its policy. 
45 While the first oneconcerns the court's power over the parties, the other one 
concerns the appropriation of the subject matter for judicial resolution; see U.S. 
Supreme Court 1972 A M C 1379 et seq. (F i l' s t N a t i o n a 1 C i t y B a n k v. B a n- 
c o N a c i o n al d e C u b a). 
40 See note 40 supra. 
47 U.S. Court of Appeals 1974. A M C 300 ("Belogorsk"). The State Department's 
recommendation was binding even in case of waiver of immunity by a foreign state; 
1971 AMC 1604.
>>>
Foreign Sovereign Immunity and Maritime Claims 


69 


of memoranda from both parties and at the request of either party, an 
informal hearing at which the parties' representatives could present their 
views to a panel of members of the Office of the Legal Adviser. 
The American judiciary in general followed the State Department's 
"suggestions" irrespective of whether they indicated that the "act of 
state" doctrine should Ol' should not be applied. This impingement on the 
judidary's attributions to apply international law met, however, with 
certain objections. The Supreme Court's conclusion in the F i r s t N a- 
t i o n a l C i t y B a n k v. B a n c o N a ci o n a l d e C u b a 48 that where 
the Executive Branch expressly represents to the Court that the "act of 
state" doctrine would not advance the interests of American foreign 
policy, that doctrine should not be applied, met with objections on the 
part of four dissenting judges, who maintained that the "act of state" 
doctrine forec1osed judicial consideration of the matter, regardless of the 
position of the Executive Branch. 
According to a c1assic American statement of the "act of state" doctri- 
ne "every sovereign state is bound to respect the independence of every 
other sovereign state, and the courts of one country will not sit in 
judgement on the acts of the Government of another state done within 
its own territory".49 This rule was, however, considerably weakened by 
the so-called "Bernstein exception"50 recognizing the discretion of the 
State Department in making its resolutions.on immunity. Although under 
the "Tate Letter" the State Department generally followed the restrictive 
theory, in some cases its suggestions were inf1uenced more by the political 
aspects of the given, case than by the juridicial iriterpretation of the rule 
of restrictive immunity, which of course created uncertainty. The need 
for change was obvious. 
The Foreign Sovereign Immunities Act of 1976 has brought a complete 
reversal of the practice established under the .,Tate Letter", as the, new 
statute plilces the responsibility for deciding sovereign immunity issues 
exclusively with the courts, doing away with the "suggestions" of the 
State Department. The Department may, however, appear as amicus 
curiae in cases of significant inteTest to the Government. In a letter 
dated Nov.2, 1976 to the Attorney General the Legal Adviser of the 
Department of State stated that the judicial construction of the new 
statute would be of general interest to the Department of State, since 
the statute, like the .,Tate Letter", endeavoured to incorporate interna- 


48 See note 45 supra. 
49 As cited in B a n c o N a c i o n a l d e C u b a v. S a b b a t i n o 376 U.S. 398 
(1964). 
10 Bernstein v. N. V. Nederlandsche.Amerikaansche, 1954 AMC 
569.
>>>
70 


Jan Łopuski 


tional law 'On sovereign immunity into damestic United States law and 
practice. 51 


SOVEREIGN IMMUNITY AND MARITIME CLAIMS: SOME GENE:ąAL ASPECTS 


International juristsquite often stress a relative importance of seve- 
reign immunity in internatianal trade relatianship.s since businessmen, 
having knowledge of the problem, formulate the contractual dauses 
against the backgraund af the law in ferce and avoid' possible incon- 
veniencesby inserting I arbitratJian c1auses by whkh the foreign state 
partner agrees that any passible disputes arising under the contract in 
question are to be submitted ta arbitration in a determined country Ol' 
place. In fact, in international sale and caaperatian contracts with parti- 
cipation of socialist state partuers the inserting of arbitration clauses has 
becO'me a cammon practice. It settles, at least partially, questions der:iving 
fram jurisdictional immunity, although the campetence of local courts 
in respect of c1aims for setting aside an arbitration award, and the enfor- 
cement of arbitratian awards, 'On state property, remain open questians. 
It would be, hawever, totally wrang I to underestimate the impartance of 
savereign immunity in international shipping relationships where the 
situation in incomparable ta that existing in the international trade. The 
Sinc1air'sview that by allawing a plea of sovereign immunity the scales 
of justice are not evenly balanced as between a ipotential plaintiff and 
a potential defendant 52 seems to be particularly pertinent when we con- 
sider martime claims. There is a number of specific factors which play 
here an important role. 
One of them is the nature of maritirńe c1aims. A cansiderable number 
of claims incident to the operation of sea vessels are connected with 
marine casualties and as such are af an extra-contractual nature (collis- 
ions, general average, salvage of wreeks, death Ol' personal injury. of 
passengers, damage to persans Ol' praperty caused thraugh the movement 
oroperation of vessels, pollution etc.). Tort claims are not ccvered by 
arbitration agreements, in any case before the c1ajm as arisen, and 
disputes as to the proper farum fcr actions based on marine tort s are by 
no means unusual. 
. In the carriage of go ods in liner shipping most of disputes cancern 
lass Ol' damage ta cargo Ol' delay in its delivery and as su ch are disputes 
between the carrier and 'theconsignee who may nat be identical with the 
shipper 
party to the contract of carriage). Relationships between the 


SI Dept. of State Public Notice No 507, Niw. 10, 1976, AMC 2362. 
SI J. M. S i n c l a i r, op. cit., p. 255.
>>>
Foreign Sovereign Immunity and Maritime Claims 


71 


carrier and the consignee are .governed by the bill of lading which most 
usua11y contains a jurisdiction c1ause providing that the disputes arising 
under the bill of lading are to be decided in the country where the carrier 
has his principal place of business. 53 It is common knowledge that in 
various countries, inc1uding the United States, the binding force of such 
jurisdiction c1aus:esisquestioned, since they aTe not jUlrisdiction agTe- 
ements negotiated between the interested parties but an imposition of 
the carrier's will on the consignee. This point of view of jurisprudence 
of SQme countries has now been sanctioned by the 1978 Convention on 
Carriage of Goods by Sea (the Hamburg Rules) under whichthe jurisdic- 
tion of courts as stipu,lated in the bill of lading c1ause is not binding but 
only optional for the consignee. 54 In respect of maritime c1aims the 
importance of arbitration agreements is practica11y reduced to disputes 
between partie s to charter contracts and contractual salvage. 
There is one mOTe speClific aspect of maritime c1aims which should 
not be left out of con
ideration. It is well..known that shipowners and 
carriers, particularly in periods of depression, quite often turn out to be 
"evasive" debtors. Ships, and in particular ships f1ying "flags of conven- 
ience", are operated through the intermedia'ry of ,suhstituted fiTms of 
a precarious financial status, carriers are not shipowners, one-ship com- 
panies disappeal' Ol' transform with minimai formalities and an utmost 
facility. Hence the iinportance af maTitime liens whtch secUir€ the c1ai- 
mant's rights on the vessel in question, and of the 'usual practice af 
'judicial Ol' administrative attachment of vessels for the purpose of 
obtaining security and founding jurisdiction in a place convenient for 
the/ c1aimant. In no field of international economic relationships the 
"folI'um shopping" and even a real stTuggle for conven
ent forum carried 
by a11 possible means and subterfuges have been so widely practised as 
in international shipping. And there is little doubt that when one of the 
contesting parties can use the shield of sovereign immunity i
 gives it 
a definite preference. It is no wonder therefore that the contestation of 
the absolute theory of sovereign immunity in legal proceedings concerning 
ships provided most of the matemai for the judicial appreciatian of the 
problem. The first international agreement based on the concept of 
re stricte d sovereign immunity in cases connected with the commercial 
activity of states concerned maritime c1aims, and in the approach of the 
jurisprudence of some socialist countries there is still a certain distinc- 


153 The Baltic and International Maritime Conference standard liner bill oI 
lad ing "Conlinebill" (el. 3). 
54Art. 21 of the Hamburg Rules. The same applies to the place of arbitration 
stipulated in an arbitration clause (art. 22).
>>>
72 


Jan Łopuski 


tion in treating the problem of immunity of state vessels and immunity 
of state foreign tra de organizations and their property. 
Certainly in case of state shipping activities the problem of immunity 
from execution may not have any real importance for the creditors, since 
state enterprises, corporations and other instrumentalities are not 
ephemeral one-ship companies but dispose of sufficient financial means 
to satisfy valid c1aims against them. But immunity from jurisdiction and 
immunity from judicial attachment of property for the purpose to found 
jurisdiction are different problems sine e even in respect of solvent 
debtors the question of proper forum as well as of recognition and enfor- 
cement of judicial decisions may not be indifferent for the c1aimants. The 
U.S. Foreign Sovereign Immunities Act 1976 tries to solve this problem 
in a way reconciling the interests of private persons doing business with 
foreign state partners, with the interests of foreign policy. Claims of 
immunity of foreign government property from jurisdictional atta,chment 
have given rise to "diplomatic irritants" in the United States. 55 


JURISDICTIONAL IMMUNITY IN MARITIME CASES 


Foreign sovereign jurisdictional immunity in matters relating to 
maritime claims is governed by the Brussels Immunity Convention of 
1926 (art. 1-2). Actually the title of this Convention is somewhat 
misleading since immunity of state...own.ed ships and jurisdictional im- 
munity are distinct questions. 


ACTS JURE IMPERII AND ACTS IURE GESTIONIS 


The Brussels Convention as well as the Genewa Law of the Sea Con- 
ventions of 1958 (I and II) have divided state ships (apart from walI'ships) 
into two categories: 1) ships employed only on government non-commer- 
cial service, and 2) ships operąted for commercial purposes. The distine- 
tion between "commercial" and "non-commercial" activity of the state is 
therefore essential for the appreciation of jurisdictional immunity under 
these Conventions. This distinetion which means mOlI'e Ol' less the same 
as the distinction between acts iure imperii and acts iure gestionis has now 
been firmly established in the Western sphere. 56 
However, neither the Brussels Convention nor the Geneva Conventions 
have provided a cri terion for making the distinction between governmen- . 


ss See Dept. of State Public Notice, note 51 supra. 

e See supra. The European Convention which enumerates the non-immunity 
cases in art. 1-12 speaks of "industrial, commerciaI or financiaI activity" (art. 7). 
The expression "commercial activities" is used by the U.S. Foreign Sovereign Im- 
munities Act.
>>>
Foreign Sovereign Immunity and Maritime Claims 


73 


tal commercial and non-commercial service. In fact the eourts of different 
states (Ol' even of the same state) are likely to have opposite views on the 
same act of state acording to the aecepted criterion of c1assifieation which 
may be nature Ol' object of the act. 
In the United States the elaboration by the judiciary of a theoretical 
basis for the distinction between acts iure imperii and acts iure gestionis 
was hampered by the binding effect of State Department's formai recom- 
mendations. In "Victory Transport"57 the Court od Appeals adopted the 
vi ew that iure imperii acts shou1d be limited to the folIowing: 1) internal 
administrative acts, 2) legislative acts (e.g. nationalisations), 3) acts con- 
eerning the armed forces, 4) acts concernh:lg diplomatic activity, 5) public 
loans. In I s b l' a n d t s e n T a n k e l' s v. P l' e s i d e n t o f I n d i a 58 
the Court of Appeals conceded that the mer e faet that a contract with 
a private commercial interest is involved does not automatical1y render 
the acts of the foreign government private and commercial. The Court 
a.rgued that "... it would be astonishing to find that eontracts by 
a foreign gavernment for the purchase of ąmunition Ol' for the erection of 
fortifications do not constitute sovereignacts". 
The Foreign Sovereign Immunities Act mentions "commercial activity" 
as one of the general exceptions to the rule of immunity (
 1605). Such an 
activity is described in the foUowing terms (d): "A ,commercial activity' 
means either a regular course of commercial conduct Ol' a partieular 
commercial transaction Ol' act. The commercial character of an acitvity 
shaU be determined by reference to the nature of the course of conduct 
Ol' particular transaction Ol' act, rather than by reference to its purpose". 
This may suggest thatin ease of a c1aim f10wing from a "particular trans. 
action Ol' act" the test should be whether the juridical nature of the 
transaction Ol' aet is su ch that it can be done by a private individual, 
irrespective of its object and seems to be consistent with reasoning applied 
in the United Kingdom in the "I Congreso dei Partido".59 
The Act defines the jurisdiction of American courts in cases of com- 
merciał activity of foreign sovereigns by stating that a foreign state 


57 1964 AMC 2387 et seq. 
58 1971 AMC 1604 et seq. 
59 L1.L.R. (1977) vol. 1, p. 555; It has been pointed out there that in case of a eon- 
tractual c1aim, the nature of the contract will be relevant, not that it will neeessarily 
be decisive of the question whether or not the case is concerned with an actus iure 
imperii. If the nature of the contract is such that it is itself an actus iure imperii, 
then any claim under it may be the subject of sovereign immunity. But the commer- 
cial character of the contract cannot necessarily preclude a breach by an "actus iure 
imperii", in which event sovereign immunity may be claimed in respect of such 
breach.
>>>
74 


Jan Łopuski 


ineluding its political subdivisions, agencie s and instrumentalities is not 
immune from the jurisdiction in any case 
...in which the acUon is based up on a commercial activity carried on in the 
United States by the ioreign state; or up on an act performed in the United States 
in connection with a commercial acUvity of the foreign state elsewhere ,or upon an 
act outside the territory ofthe United States in connection with a cOffimercial acti- 
vity of the foreign state elsewhere and that act causes a direct efiect in the United 
States (
 1605/a/2), 
It refers to the American coricept of "doing business" within the 
United States as a connecUng factor to found jurisdiction of American 
courts. Under the 1976 Act the court will have tó determine Jjrst whether 
the defendant is engaged in a commerdal activity. , 
In the jurisprudertce of the West European countries the nature of 
activity is more Ol' less comIDonly accepted as a proper .criterion for 
ma'king a distinctionbetween acts 
ure imperii and aets iure gestionis. 60 
In 1963 the "Bundesverfassungsgerieht" of the Federal Republie of Germa... 
ny, while rejecting the plea oJ sovereign immunity,made the following 
statement of a considerable theoretical importance. 


The distinction between acts iure imperii and acts jur e gestioniscan only be 
based on the nature of the act. oi the State orof the resulUng legal relation, not on 
the motive or purpose of the activity. What is relevant is whether theforeign state 
acted in the exercise oi its sovereign power; thus in the sphere of public law, or 
acted like a priv'ate person, thus within the sphere of private law 61. 
The distinction between the spheres of publjc and private law deeply 
ingrained in the tradition of legal thinking\of the WestEuropean eonti... 
nental countries has made the ctassificationof acts into iure imperii or 
iure gestionis a mu eh easier task for their judiciary if compared with 
difficulties encountered by the English judiciary where the above distinc- 
tion is by no means elear. 
The distinction between the acts iure imperii and iure gestionis based 
on the criterion of nature of the activity mayaIso be relevant for the 
proper interpretation of the Brussels Convention of 1926. The mere fact 
that a state-owned ship is employed on commerclal s€rvice does not 
exc1ude the plea of sovereign immunity in respect of a claim, which - 
even though incident to the operation of that shiJp - flows from an 
actus iure imperii. As the "I Congreso" case 62 has clearly shown, the 
immunity of a state-owned ship. as such and the jurlsdictional immunity 


811 J. M. S i n c l a i r, op. cit., p. 263-265. This may implya revision of formerly 
hel d opinions that the purchase of boots for the army constitutes an actus iure 
imperii; see also H. L a u t e r p a c h t, International law..., p. 484-485. 
81 As cited in English by J. M. S i n c l a i r, op. cit., p.263. 
81 See note 59 supra.
>>>
Foreign Sovereign Immunity and Maritime Claims 


75 


j. 


of the 'sovereign in actions connected with the operation of that ship are 
distinct questions which should not be confused. 
The socialistdoctrine rejects the distinctionbetween the public law 
andprivate law spheres of actvity of the socialist state and consequently 
between acts iure imperii and acts iuregestionis,63 and maintains that the 
determination of the nature ofstate's fUIlctions belongs to that state only. 
While the absolute jurisdictional imrnunity of state is consideredas 
a basic principie by the socialist jurisprudence, there are exceptionsas 
regards maritime c1aims at least in these socialist countries, which par- 
ticupate in the Brussels Immunity Convention of 1926. 64 


JURISDICTIONAL IMMUNITY AND ACTION IN REM 


Jurisdictional imrnunity claimed by a sovereign in legal proceedings 
directed against him is rnotivated by special attributes of the sovereign 
asa defending party., But in the legal systems of the United States, 
United Kingdom and some other common law countries there are two 
types of' remedies open to the plaintiff against a foreign smpowner Ol' 
cargoowner: action in personam directed against the defendant by name 
or action in rem directed against the ship herself (Ol' another res) to 
.satisfy tbe plaintiff's claim out of the res. In thelatter proceedings 
"ownersand parties interested in the property proceeded against" are not. 
described by name, and the problem arises under which conditions sove- 
reign immunity may be claimed in such proceedings. In this way the im- 
munity oi state ship as a jurisdictłonal issue comes into the picture. The 
in r.em suits virtually urrknowri outside the adrniraltycourts, have 
inf1uenced the construction of the Brussels Irnmunity Oonvention and lie 
at th,e rootsof ship's personification. 
In the United. States. action in rem may be brought only in respect of 
c1aims based on maritime liep. In maritime law of the United States the 
list of maritime liens is a long one and we may assume that maritime 
claim s , as defined for the purpose of this article, are protected by marti- 
me lien. To establish in rem jurisdiction in a dmirally , the res must be 
present in the district when the suit is filed 01' during the pendency of 
the action.6
 ' 
In the practi;e established under the "Tate Letter" the American 
courts did not exercise jurisdiction over foreign state vessels whose 
immunity was recognised by, the State Department and one mayassume 


63 J. H a a l c k, op. cit., p. 147; he called it simply absux:d. See also S. A. G u- 
r e v, op. cit., p. 144-146. . 
64 Hungary and Poland. Poland denounced this Convention in 1952 but ratified 
it again in 1976. 
86 1975 AMC 1216 ff.
>>>
76 


Jan Łopuski 


that in such a case no maritime lien could arise. Under the Foreign 
Sovereign Immunities Act (
1605/b/) a suit in rem (in admiralty) may 
be brought against a vessel Ol' cargo of the foreign state to enforce 
a martime lien which is based upon a commercial activity of that state, 
and nó immunity from the jurisdiction of the American courts may be 
claimed by the interested foreign state. Since, howeve1r, 
 1610/cl and Idl 
of the Act eliminates the earlier practice of prejudgment attachment for 
the purposes of acquiring jurisdiction, maintaining a quasi in rem 
action 66 , on delivery of the notice of suit to the person having possession 
of the vessel Ol' cargo against which the maritime lien is asserted, the 
maritime lien is "transformed" in an in personam claim against the 
foreign state which at that time owns the vessel Ol' cargo involved. In 
such a case the court may not award judgment against the f.qreign state 
in an amount greater than the value of th
 vessel Ol' cargo up on which 
the martime lien arose. 


JURISDICTIONAL IMUNITY OF STATE SHIPPING ENTERPRISES 


The American attitude to the problem of immu.nity of foreign state 
enterprises obvi.ously differs from that accepted in the West European 
jurisprudence. While the European Immunity C.onventi.on does not extend 
immunity to separate legal entities,. the Foreign Sovereign Immunities 
Act of 1976 applies La. t.o agencie s and instrumentalities of a f.oreign state 
Le. any entity which is a separate legal person, corp.orate or otherwise 
"a majority of whose shares or other ownership interest is owned by 
a foreign state Ol' political subdivision thereof", which would cover state 
enterprises OT corpo'I'ations (
 1603 lal and Ibl). This unwil1ingeness to treat 
state enterprises as independent legal persons was earlier expressed by the 
judiciary. In T l' a n s n a t i o n a l M a l' i t i m e, I n c. a n d T a P e n g 
S t e a m s h i P C o. L t d v. Repu b l i c o f B a n g l a d e s h the cóurt 
stated that when a corporati.on is wholly .owned by a party possessing the 
pervasive powers enumeTated in the directive (Prestdential Directive), 
any assertion of independent existence is a mere pretext. 67 This attitude 
is aimed at pierdng the corporate weil behind which the fOTeign state 
may oonceal its activity. 
Foreign state shipping enterprises are, theref.ore, no more immune 
from jurisdiction of American courts in actions concerning martime 


tlili G. R. D e l a u m e, op. cit., p. 410. 
117 1975 AMC 1411 ff in the reasons the Court has found that .....assuming that 
the Bangladesh Steel Mills Corp. was truly a separateentry, it would be unconscio- 
nable to allow a foreign corporation to represent itself by an arm of its government 
for the purpose of conducting commercial negotiations, and then to deny that very 
agency relationship".
>>>
Foreign Sovereign Immunity and Maritime CIa im s 


77 


claims falling under the non-immunity exceptians, than the foreign states 
themselves. 
As it has been earlier pointed aut 68 in the jurisprudence of the East 
European socialist cauntries a shift of opinio n has taken place towards 
declining jurisdictional immunity to state enterprise which are legal 
entities separate from the state,69 with some reservations, however, that 
immunity - being considered as a question belonging to the legal status 
of the entity - should be governed by its national law. Shipping state 
enterprises of the East European socialist cauntries are separate legal 
entities, and there are no valid reasons that they should be treated diffe- 
rently than foreign trade enterprises which generally do nat claim 
jurisdictional immunity. Polish state shipping enterprises, if sued in 
foreign courts, did not raise plea of immunity even before the ratificatian 
af the Brussels Immunity Conventian. 


IMMUNITY OF STATE VESSELS AND CARGOES FROM ATTACHMENT 


Legal proceedings cancerning maritime claims, if cammenced in foreign 
courts, are generally connected with the judicial attachment af the 
defendant's property (vessel, carga or freight) far a twofold purpose: 1) ta 
found jurisdictian of the local court, 2) to obtain security out of which 
the judgment may be satisfied. In case of arrestof state vessels ar cargoes 
diplomatic requests for -recagnition of immunity of foreign state property 
were quite common. In the United States the Department of State's 
policy under the "Tate Letter" was to rocognize an immunHy af foreign 
government property from attachment uniess: 1) the property in question 
was devoted to a cammercial Ol' private use, 2) the underlying lawsuit 
was based on a commercial Ol' private activity of the foreign state, 3) the 
purpo
e of the attachment was to commence a lawsuit and not to assure 
satisfaction of a judgment. 70 
The 1976 Act has brought a substantial change in this matter as it 
eliminates the earlier practice of prejudgment attachmEmt so dear to 
marin e lawyers. The statute has prescribed a means for commencing 
a suit against a fareign state and its entities thus making attachments 
as a means for founding jurisdiction unnecessary. Under the Act no 
prejudgment attachment of state property can be made befare rendition 
of judgment unless the foreign sovereign has explicitly wa
ved its immu- 


68 See p. 63. 
69 M. M. B o g u s l a v s k y, Internationales Privatrecht, Val. 1, Potsdam-Ba- 
belsberg 1976, p. 176. 
10 Dep't. of State Public Natice, note 51 supra.
>>>
78 


Jan Łopuski 


nity prior to judgmentand the purpose of the attachment is solely to 
prevent the removal of property that may ultimately be the object of ' 
execution. 71 
By providing an absolute immunity of foreign state property from 
jurisdictional attachment, with no exception in respect of maritime pro- 
perty such as vessel Ol' cargo, the American statute differs sharply from 
the law of the countries which have ratified the Brussels Im:munity 
Convention, since the Convention assimilates the position of state-owned 
and state-operated vessels engaged in trade and cargoes to that of priva- 
te-owned vessels and cargoes as far as attachment is concerned. 72 Also 
the European Immunity Convention does not prohibit the attachment of 
foreign state property in order to found jurisdiction. 
On the other hand the American statute meets the claim of "uIltou- 
chability" of fo['eign state property advanced by the Soviet doctrine. 73 
The immunity from attachment of state-owned Sovietvessels is provided 
for explicity in art. 20 of the USSR Merchant Shipping Code (1968) as 
conseqruent on the legal status of su;h vessels. The attitude of other Eeast 
European socialist states to the problem in question isby no means 
uniform and may depend on the accepted concept of ownership of state 
property. While the Soviet state shipping enterprises are not considered 
as owners of vessels under their management (su ch vessels are owned by 
the Soviet State) in Poland the state shipping enterprises are registered 
owners of their vessels. 74 Consequent1y immunity from judicial attach- 
ment has never been c1aimed in respect of Polish vessels operated b:y- 
state enterprises for commercial prurposes. In the reciprocal relationships 
of the CMEA coruntries the immunity from attachment o£ their vessels 
is recognized by virtue of a special understanding concluded in 1971. 


IMMUNITY OF ST A TE VESSELS AND CARGOES FROM EXECUTION 


A nęcessity to proceed with execution against a foreign state property 
may only very seldom arise since states are in general solvent debtors 
and meet their obligations. It may occur, however, that a state refuses to 


71 G. R. D e l a u m e, op. cit., p. 410. 
71 Art. II; compare S. S u c h a r i t k u l, State immunities and trading acivities, 
London 1959, p. 93. 
73 M. M. B o g u s l a v s k Y, Internationales..., p. 173, Whiłe stating that jurisdic- 
tional immunity does not extend on attachment, he makes, however, an exception 
in respect ot the USSR property under the management of foreign trade organiza- 
tions, which is not protected byimmunity. 
7ł Probably a similar situation exists in Bulgaria; see a.rt. 28 of the Bulgarian 
Merchant Shipping Cod e of 1971.
>>>
Foreign Sovereign Immunity and Maritime Claims 


79 


, - 
recognize jurisdiction of a foreign court, does not enter appearance and 
judgment in default is given against it. Ii the rule of executional im- 
munity were obse!l'Ved, judgments of local courts not re...."Ognized by foreign 
state defendants would be ineffectual. 
Delaume,'l5 writing on the American Act of 1976, has stated that it 
improves the situation of ,private c1aimants in this respect by enabling 
them, if judgment is rendered in their fav1Qur, to proceed with execution 
against the governmental property. 
Pursuant to 
 1610 lal of the Act the propffi'ty of a foreign state is 
i.a. not immune from execution when the following conditions are 
satisfied: 1) the property is used for a commercial activity in the United 
States,' 2) the pro pert y is or was used for the commerdal adivity UJpon 
which the c1aim is based. In respect of property of "agencie s and instru- 
mentalities" the exc,eptioh of non-immunity is even extended. Wh
re such 
an en,tity is engaged in a commercial activity in the United States and 
the judgment iiS related tlO a claim flOr which the' entity is not otherwise 
immune from lawsuit, all its property in the United States is subject to 
execution, irrespective of whethh there is a llnk between the property 
in questiion and the commercial activity from which the c1aim arose.'l8 
It wou1d folIow therefrom that foreign state vessels and ca:rgoes used 
for commercial activity in the United States would not be immune from 
execution under the 1976 Act in respect of c1aim:: based on such an 
activity of the defendant. 
Under the Brussels Immunity Convention immunities from attachment 
and execution are treated in the same" manner which follows from the 
assimilation of state-owned vessels and cargoes to those private-owned. 
It may be interestirig, however, that the European Immunity Convention 
(not applicable to maritime daims) prohibits execution in the state of the 
forum against property of a Contracting State, imposing at the same 
time an international obligation to give effect to judgments of courts of 
Contracting States in cases falling within the catalogue of rules of non- 
-iimmunity.'17 The immunity does not apply, however, to the property of 
foreign state enterprises. 
The sodalist doctrine of "untouchability" af state property applies in 
more Ol' less the same manner to the seizure for the purpose of execution 
as to the prejudgment attachment. Artiche 20 of the USSR Merchant 


76 G. R. D e l a u m e, op. cit., p. 399. 
78 Ibid., p. 410-411. 
77 J. M. S in c l a i r, op. cit., p. 276. Many West European states recognize an 
,absolute executional immunity of foreign state property; see E. Wen g e rek, op. 
cit., p. 133-135.
>>>
8U 


Jan Łopuski 


Shipping Code covers both the im mu nity from attachment and exaction 
measures. 


CONCLUSIONS 


In spite of basic theoretical divergences concerning the principie of 
foreign sovereign immunity between the socialist and Western jurispru- 
dence one may trace certain converging lines in the practical application 
of the immunity rule. Trade and shipping activity of the East European 
socialist countries is performed by state entities which, as a rule, do not 
claim jurisdictional immunity if sued in foreign courts, and - as pointed 
out by some jurists - are not legally entitled to immunity. The practical 
result, therefore, should not, in most cases, be very far apart from that 
reached onder the Brussels Immunity Convention, European Immunity 
Convention or U.S. Foreign Sovereign Immunities Ad. As regards juris- 
dictional immunity substantial differences would arise only in case of 
commercial activity performed by the state itself. 
With regard to immunity from attachment the prohibition of pre- 
judgment attachment as provided by the U.S. 1976 Act meets the Soviet 
claim of "untouchability" of state property. On the other hand two 
socialist states participate in the Brussels Immunity Convention which 
permits the attachment of state commercial vessels and cargoes. More 
divergences exist in respect of the executional immunity but not only 
between the legal systems of East and West but also between the new 
American legislation and the law applied in Western Europe. 
In the existing situation it does not seem any more possible to seek 
the solution of the problem in question by reference to the general 
principles of international law. The problem has become ripe to be solved 
by an open multilateral convention of a general application, not restric- 
ted to maritime claims only.
>>>
ACTA UNIVERSITATIS NICOLAI COPERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 1m 


D.epaTtment of Criminal Law 
and Criminology 


Andrzej Marek 


\ CRIMINALITY AND ITS CONTROL IN POLAND 
(THE DATEN, tOMMENTS, AND INTERNATIONAL COMPARISONS) 


c o n t e n t: The article deals with the problem ofcomparisOns of criminal 
statistics, presents the extent of criminality in Poland from 1955 to 1977, and 
discusses the criminal policy employed in crime contro!. Emphasis is put on penal 
measures, especially those which do not depen.d on the criminal confinement (pro- 
bation andother community-based measures) which the autor considers to be 
most promissing in dealing With criminals. 


THE PROBLEM OF COMPARISONS OF CRIMINAL DATA 


The problem of crime and delinquency is a subject of major concern 
for criminologists, law enforcement agencie s and the general public 
throughout the world. In the field of inter,national cooperation it is 
essential to establish an exchange of information on crime and de1!in- 
quency and experiences in struggle against criminality. This artic1e is 
meant to contribufe tothe said cooperation by providing a substantial 
data on adultcrime in Poland and on the policy of crime suppression. 
Beforle presentdJng ąnd diroussing the statistica:I data, we should note 
tOOt internationail comparisons of crime and delilnquency lis a very 
dlifficrult problem. As the U.S. iNartiona1 Comm:iissiQll on Causes and 
Prevention of Violence has warned, such comparisons are "exceedingly 
difficult to make - because of different criminal statutes, reporting 
procedures and cultural interoictions".l It would be interesting to note 
that Scandinavian countries of Sweden, Norway, Denmark and Finland 
have made attempts to coordmate theiJr C!rimilna1 sta1Jistics, but with liittlte 
success. According to Nils Christie, 


, 
1 International Comparisons, [in:] L. Radzinowicz, M. E. Wolfgang 
(eds.) Crim.e' and Justice, vo1. 1, The Criminal in Society, New York-London, Basic 
Books 1971, p'. 225.
>>>
82 


Andrzej Marek 


Even in these countries with great similarities in social structure, language, 
administrative arrangement, and police organization [...] it has proved nearly 
impossible to compare the fina l outcome of the respective official systems of . 
crime registration 2. 


These diiiiculties increase substantially when we compare criminal 
statistics fOT countries which diffe!l' in terms of population, socio-economical 
organization, and which also have different systemSi oi law and admini- 
strations oi justice. It leads the International Police Organization, which 
publish criminal statistics supplied by. member states, to the conc1usion 
that such comparisons "can only be approximate".3 Some experts arre even 
of the opinion that these comparisons are completely meaningless. 4 
Certainly international coml'arisons of criminal statistics would have 
to be made with a great deal of ,caution, but shauld be made. II this is not 
done, it will be virtually impossible ta ma!ke progress in the future. 
Besides, the a'bove said O'bjections seem to be exaggerated if we tak e 
in to consideration commonly recognized indicators like crime rate 
accaunted for by comparising the crime num ber with size of the popula-. 
tian,5 increasing ar decreasing trends both in a'bsolute crime number and 
crime rate, age and sex ratios in crime, and the rate of recidivism which 
indicates the efficiency of methods and means used in dealing with 
criIIfinals (though social causes of recidivism are admitted). By providing 
such data one could contribute ta the total body of knawledge about the 
crime phenomenon, its characteristics and developrnents.In addition, the 
comparisonsof success and failure rates of various penal measures could 
enrich our experiences in struggle against criminality. 
To pursue the actual incidence of criminality and its characteristics 
it is always necessary to choose a source of data. According to often 
quoted statement' of Thorsten Sellin, "the value of criminal statistics 


2 N. C h r i s t i e, Comparative Criminology, quoted after:. National Institute oj 
Mental Health, Center for Studies of Crime and Delinquency, Rockville (nodate 
given), p. 23-24. 
8 International Criminal Police Organization, International Crime Statistics for 
1965-1966,'Saint-Cloud 1967. 
4 National Institute oj Mental Health..., p. 23. 
5 Obviously, from such comparisons so-called petty offenses (contravention, 
Verfehlungen) would have to be excluded, For example, offenses adiudicated . by 
traffic courts in the United States are not recorded in crime statistics, crimęs re- 
corded in court statistics for England and Wales in 1970 were 250,134, however if 
"petty offenses" are added the number reaches 1,547,772. Respectively, in Poland 
in 1975 crimes sentenced by courts were 167,023 while "petty offenses" adiudica'ied 
in penal-administrative procedure were 570,087. For data regarding to other Euro- 
pean countries see: J. J a s i ń s k i, Punitywność systemów karnych, [Punitiveness 
of penal systems], Studia Prawnicze, 35/1973, p. 21-61.
>>>
Criminality and its control in Poland 


83 


decreases as the procedures take us furthel' away from the offense itself".' 
The implicat1on"is that many ofenses are "lost" for legal and extra legal 
reasons - during the criminal proceedings, namely between the records 
of police, prosecution, and convictions by court. That is why in American 
literature police statistics are considered more reliable than court statis. 



 7 
Ul.\;S. 
This opinion seems acurate only in rega
d to dimensions of criminality 
and the dynamics of the phenomenon. However, for studying circums- 
talI1cets SluITOulI1wng the crimiinal case, drilspositd.ons macie dUi!'
ng the criminal 
procediure, pelOOlmealSul'€'s used' in dealing IWIith emmi!na1s aJrid their 
outcomes, ońly court statistics can give us proper informations. In addi- 
tion, court statistics are of value since they indicate data confirmed by 
the llegal proc€'dwre. The problem ils ihatoome ooUilltries do not provide 
nationwide court statistics, including the United States. In that country 
only Oalifornia halS staiistics that coveralH phaJSes of the crirrrinal prócess 
from arrest to appeal, and from dispositiol1 to recidivism. 8 Such -nation- 
wide central statistical system has been strongly urged by the Persident's 
Commission on Law Enforcement and Administration of Justice and many 
re:searchers. 9 Sinae Poli8l11id provides cenrt:raJ.oourt stat
ic that coverall 
dispositions made in the criminal proceedings, we can use this reservbir 
of data in our investigations. 
As it was said,- foOr pursuing the incidence of criminality police statis- 
tics should be used because they provide data which are closer to crime 
occurences. However, we have to point out that even police statiJstics aTe 
far away from an actual incidence of criminality. As it is commonly 
known, a large rportion of aU law violations goes undetected, other crimes 
are detected bu t - for various reasons - not reported, and still others 
are reported, but not recorded. 10 That is why in attempt to explore 


6 Th. S e 11 i n, The Signijicance oj Records oj Crime, [in:] L. R a d z i n o w i c z, 
M. E. Wo l f g a n g, op. cit., p. 121-129. 
7 See, for example, E. H, S u t h e r l a n d, D. R. C r e s s e y, Criminology, 
9th ed., PhiJadelphia: Lippincott Co. 1974, p. 26; R. Q u i n n e y, Criminology, 3rd 
ed., Boston: Little-Brown and Co. 1975, p.17. 
8 Criminal Statistics Bureau, Crime and Delinquency in California, Sacramento 
\ (Annual). 
9 P. P. L e j i n s, National Crime Data Reporting System: Propos al jor a Model, 
[in:] U. S. President's Commissior. on Law Enforcement and Administration of 
Justice, 'l'ask Force Report, Washington: Govern. Print. Office, 1967, p. 178-226; 
R. H. B e a t t i e, . A System of Integrated Criminal Statistics, Criminologica, 5/1967, 
p. 12-19. 
10 "'l'he Challenge of Crime in a Free SOciety, A report,. New York: Avon Pub!. 
1973, p. 96-100; in Polish literatur e L. L e r n e 11, Zarys kryminologii ogólnej, 
[Outlines of general criminology], Warszawa 1973, p. 75-84.
>>>
84 


Andrzej Marek 


"h:i:dden CIl"i:mina1ity" the new method of Vlictirm sUTveys has been recently 
developed, especialIy in the United States. In that country surveys have 
found self-reported amaunt of crime to be !everal times that reported to 
the Unifarm Crime Report. 1l This method has made certain progress as 
additional source of informat!an about the incidence of crime, although 
several drawbacks are invalved inc1uding reliance on the victim's ability 
ta recall accurately previous events, his willingnessta cooperate in the 
survey, and credibility as it has been observed a tendency ta overestima- 
tions. 12 Although the victim survey is an additional source of information, 
it cannot replace official crime statistcs whiG'h still rerom main SIOurce 
of data about crime and delinquency and only data .on dispositions made 
during the criminal proceedings. 
The results of investigations stated below depict several aspects of 
crdimi1nality in Po1aJnid. The changilI1lg natme of c:rdJme iln this country, a's 
well as abroad, does not allow us to consider yesterday's situation as still 
valid at the present time.-.Nevertheless, by examining statistical data aVer 
many yems it will be possible to drnw oome cmclusims about the 
develapment of the phenomenon. For doing 50, however, we shauld be 
cautious indrawing direct canc1usians, keeping in mind that there art: 
many ,variablesaffecting crime statistics inc1uding nat only reporting 
procedures, but also changes in the law. As we shal1 see, the last factol' 
has had a significant influence on crime statistics in Poland. 


THE EXTENT OF CRIMINALITY 


In Poland, since 1955, twa source of statistics concerning crime and 
delinquency have been published: court statistic and combined People's 
Militia and public prosecutars st
tistiC.13 In additian to these, the General 
Office of Statistics (GUSf has published a yearbodkof statistics which 
contains many issues, such as marketing, urban development, education, 
welfare, and among them a general informationabout crimes recarded 
and types of court decisions. The data we shalI discuss are based upon 
more detailed the Militia and the caurt statistics as welI as derivedfrom 
indti. vidual investiga tions. 
On January the 1st, 1970 a new Criminal Code of 1969 went in to 


11 The Challenge oj Crime.." p. 96-,-100; U. S. Department oj Justice: Crime. in 
Nation's Five Larges Cities, National Panel Survey, Washington: Govern. Print. 
Office 1974, p. 19-21. 
12 The lVationalCrime Panel Survey: A Critical Review by S. 1. Singer, Uni- 
versity of Pennsylvania 1976 (a paper). 
18 Henceforth these data will be refered as' to "Militia statistic".
>>>
Criminality and its control in Poland 


85 


effect 14 and the system of criminal law in Poland has generally changed. 
Therefore, for the sake of comparability we shall discuss primarily data 
beginning from 1970, with exceptions to information on general numbers 
of crimes recorded and numbers of court sentences also in previous years. 


Table l 
Crimes rccordcd by the People's Militia 
and public prosecutors 


Year 
1955 
1956 
1957 
1958 
1959 
1960 
1961 
1962 
1963 
1964 
1965 
1966 
1967 
1968 
1969 
1970 
1971 
1972 
1973 
1974 
1975 
1976 
1977 


Numbcr 
339,840 
369,194 
408,623 
442,451 
477,910 
517,520 
498,781 
490,171 
514,172 
483,487 
503,385 
548,796 
502,193 
467,810 
478,061 
424,217 
475,411 
379,086 
355,125 
339,542 
340,440 
324,181 
344,506 


Rate 
er 10,000 inhabitants 
125 
132 
144 
154 
163 
175 
166 
162 
168 ' 
155 
160 
173 
157 
145 
147 
130 
144 
114 
'105 
100 
99 
93 
98 


Tabele 1 presents the il1Iumbe!r 9f or,]mes xęcorded. .AJs we can see, in 
1955 and 1956 the numbexs of orimes recorded weTe relatively law, and 
subsequent1y increased. The explanation may be two-fo
d. First, in those 
years a new statistical system was introduced which caused many 
difficulties in recording all crimes. Secondly, those were years of great 
polittcal and social changes as a result of the overthrow of Stalin-regime. 
Im 1956 a lao:ge amnesty was enact1ed wbich affected aloo years of 1957- 
1958. 
Since 1960 the num ber of crimes recorded gradually increased reaching 


14 Journal oi Law of the Polis h People's Republic, [D7.iennik Usta.w], 13/1969, 
itcms 94-98.
>>>
86 


Andrzej Marek 


its hight in 1966; subsequent1y both the absolute number of crimes recor- 
ded and the crime rate decreased. The most significant decrease has 
occured in 1972, and - what should be pointed out - still lasts at the 
prese1it time. . 
Steady,' substantial decrease in crime recorded since 1972 must be 
considered a
 a very important and also optimistic trend of criminality 
in Poland, if we compare it to reported increases af crimes recorded in 
many countries, including those very highly developed. 15 Especially rathel' 
mild and also diminishing Iratle of crime accounted for 10,000 of inhabitants 
allow us to make su ch conclusion. 16 However, this decrease may be consi- 
dered. as less pronounced than the statistic indicates. On January 1st, 
1972 went into effect the "Slight Misdemeanor Code"17 which has rede- 
fined several offenses as petty ofenses, that previously wereconsidered 
crimes, for example: driving a motor-vehicle while under influence of 
alcohol, larceny below 500 zł (without using force Ol' threat against the 
person). These petty offenses are not longer recorded in crime statistics 
as a subject to procedures before special citizen commissions adjudicated 
yearly about 40,000 of such pet ty offenses that were shifted f'rom the 
criminal procedures.1 8 If we add this num ber of 40,000 to the nurnbers of 
crimes recorded after 1972, the diminishing trend in criminality will be 
less pronounced, but still substantial and persistent. The figures will be 
as follow: 419,086 in 1972: 395,125 in 1973: 379,542 in 1974: 380,440 in 
1975; 364,181 in 1976; and 384,506 in 1977. 
Table 2 presents the number of per:sonls :sentenced 'by cQlUrts and It'he 
numbe'r of persons placed in conditional discontinuation of the criminal 
proceedings. Strictly speaking, the table gives a number of sentences, not 
persons sentenced, which Teflects a commonly known drawback of oourt 
statistics since: "One person may have committed twenty crimes, but he 
will appeal' in the tables ais twenty persons".1 9 The figures are lower than 
in Table 1 because, as wais mentionedbefore, many ca.ses drorp-out dur ing 
criminal proceedings. In Poli]sh criminal practice the public prosecutor 
may decide on the discontinuation oi the crlminal procedings when an 
offender is not apprehended, when the offense is considered of slight 


15 See supra note l. 
18 As to compare, the crime rates per 10,000 inhabitants in the United States 
were: 335 in 1968, 414 in 1971, and 528 in 1975. See Fef1eral Bureau of Investigation: 
Uniform Crime Report, Washington: Govern. Print. Office 1976, p. 49; compare: 
Abstract of Statistics 1976, London 1976, p. 93; Statistisches Jahrbuch fUr die 
Bundesrepublic Deutschland, Wiesbaden 1976, p. 132. 
17 Journal of Law of the Polish People's Republic, 12/1971, items 114-116. 
18 W. Ś w i d a, Kryminologia, [Criminology], Warszawa 1977, p. 124. 
18 Criminal Statistics, National Institute oj Mental Halth..., p. 4.
>>>
Criminality and its controi in Poland 


87 


social dJainger (moc negl!i.gible injury Ol' darmage cau1sed), or when evidence 
are insufficient to bring an accusation before the court. Thus, comparing 
both statistics we can see that about 60 percent of aU crimes recOTded 
ended in conviction. 20 


Table 2 
Persons found guilty for having cornmitted crimes 
Year Court sentences Conditional discontinuations Total 
of criminal proceedings 
1955 207,146 
1956 135,743 
1957 176,697 
1958 257,004 
1959 280,761 
1960 301,927 
1961 328,490 
1962 298,090 
1963 271,545 
1964 191,933 
1965 222,323 
1966 264;377 
1967 245,932 
1968 232,466 
1969 157,807 
1970 172,611 31,100 203,711 
1971 204,131 40,261 244,392 
1972 177,275 42,816 220,091 
1973 159,072 38,747 197,819 
1974 152,298 29,883 182,181 
1975 167,023 28,937 195,960 
1976 164,105 30,764 194,869 


OonceQ"mrng the COU!l't statd.rstlic, we n()tice dleC!l'eases iJn the numbe!l' of 
sentences in 1956, 1957, 1969, and from 1970 till 1976. The decrease in 
1956, 1957, as it was mentioned before, was due to the larg e amnesty act 
of 1956. The next decreases occured in 1964 and 1969, and both )Vere 
connected with subsequent acts of amn
sty which affected less seriours 
crirorinal offenses. \ 
The diminishing tendency in senteIlces observed from 1970, which 
continues to the rpresent, may be explained in two-folds. First, a dimin- 
ishing number of crimes r€Corded in fl1e Mi1itia statistic (see Table 1) has 
affected ałso the court statistics. Secondly, the CQurt statistic ref1ects also 


20 This index for the United States may be estimated at about 30 percent on 
the average, see: S. H. S u t h e r l a n d, D. R. C r.e s s e y, op. cit., p. 26-27.
>>>
88 


Andrzej Marek 


chaniges in legał Iregulations and, eo ipso, changes of arianina! policy. In 
iny opinion, the most substantial impact hals had the introduction in the 
Criminal Code of 1969 a new institution of conditional discontinuation of 
the criminal procedings, whkh is a form of probation in addition to tradi- 
tional suspension of the execution of sentence by the court. 21 The condi- 
tion.al discont'inuation of the criminal proceedings has been used more 
frequently by public prosecutors than by courts, the ratio being approx- 
imately 6: 1. Although this lClisposition is nót considered a punishment, 
it may be U'sed when the offender has bean found guilty fQr hovingcom- 
mitted a crime. BecaU'se of 
his we should add the number of persons 
placed in thrs disposition to the number of persons sentenced in order to 
obtain the total number ot persons who have be en found guilty for having 
commdttted cx:imes (see right column ot Ta:ble 2). . 


THE GENERAL CRIME STRUCTURE 


Previously considered data show diminishing trends both in the 
number of crimes recorded and in the number of persons found quilty 
for having committed crimes. It does not tell 1.1'S, however, on crime 
structure and on tendencies in specific categories of crime. Before pre- 
senting the data on these issues, we should ma'ke some reservations. The 
structure of crime is a very difficult and all-encompasing problem which 
can be discussed quite brief1y in this paper. The court statistic in Poland 
presents data on detailed crime categories whi:ch are based upon court 
sentencies and c1assified according to the law regulations. These detailed 
classification would not very informative to a foreign reader, 80 we shalI 
use a general crime categories empha,sizing the most serious crimes. 
Table 3 p!l'esents categories of crimes drawn from the court statistic. 
Within a whole crime structure two general categories predominated, 
namely crimes against the person and crimes against prOlperty. These two 
categories accounted for 52.6 percen1 of aU cximes committed. It should 
be added that a1so other categories involve offenses against the person 
or against property, especially cximes against public safety (e.g. arson, 
traffic accidents). 
Within the category of crimes against the person, three most serious 
offenses provoke public concern: murder, aggravated assault and rape. 
The extend of these crimes decides the public safety, and ther.efore is 
subject of great efforts in prosecuting. and punishing the offenderś. 
Murder inc1udes in Polish law all offenses that cause death intentionally, 


11 See A. M a rek, Warunkowe umorzenie postępowania karnego, [Conditional 
discontinuation of the criminal proceedings], Warszawa 1973, Chapter l.
>>>
Criminality and' its control in Poland 


Table 3 
General crime structure in 1976 


89 


Crime categorics 


Number 


Percen- 
tage 


Crimes against public safety: 
Catastróphe or inducing a public jeJpardy 
Serious traffic accident 
Arson 
Crimes against the person: 
Murder 
Manslaghter by negligence 
Aggravated assault 
Simple assault 
Battery 
Rape 
Crimes against property: 
Theft of public property 
Theft of private property 
Organized theft 
Robbery 
Burglary 
Forgery 
Motor-wehicle theft 
Crimes against family and juveni1es 
Crimes against functioning of administration and 
justice systems 
Crimes against public order 
Others (induding viotations. of tax and custom 
duties) 
Total 


10,951 
190 
9,485 
628 
23,335 
439 
358 
586 
10,549 
8,963 
1,420 
60,432 
25,371 
16,992 
1,87i 
3,355 
9,700 
1,292 
1,871 
18,559 


9,241 
1,256 


35,689 
159,363 


6.9 
0.1 
6.4 
0.4 
14.7 
0.3 
0.2 
0.4 
6.6 
5.6 
1.6 
37.9 
15.8 
10.7 
1.2 
2.1 
6.1 
0.8 
1,2 


11.6 


5.8 
0.8 


22.3 
100 


aggravated assault may be defined as infUction of bodily injury on the 
person, and rape as intercour.se or its equivalent performed by the \lI5e oi 
force, the threat to use of force, anld the' abu'Se of unconsćiou911ess or the 
fraudulent consent of a ,victim. 
The rate of murder for Poland, per 100,000 of population, is quite low. 
when compared to roany other countries. It accounts for 1.0 in 1971 wbile 
for the United States 8.5, for France 16.7 in 1969, and for England 3.5 in 
1969.22 Nevertheless, the 'I1umber of tMs most serious crime is growmg 
whai produced deep concem, strict prosecution and severe punisbment of 


22 S. H. S u t h e r l a n d, D. R. C r e s s e y. op. cit., p. 35.
>>>
90 


Andrzej Marek 


the offenders. In 1961 murders were 283, in 1969 were 352, and in 1976 
the num'ber of sentences for this crime reached 439. It should be .added 
that Pollsh law provides the death penalty for the murder which may be 
imposed only in extreme cases whlen the co1Jrt ha:s not fOUlnd any mitiga- 
ting circumstances. The number of death penalties ranges in recent years 
from 6 in 1969, 15 in 1972, to 23 in 1976. It should be a1so added that 
death penalty is considered tempmary, and Article 30 
 2 of the Criminal 
Code dec1ares its an extraordinary character (possible future abolltion).23 
As in msny other countries,24 the number of ratpes 1S also growing: in 
1961 were 454 offenders sentenced for this crime, in 1969 were 1,169, and 
in 1976 the number reached 1,420. The incresse in rape is 'seen ascon- 
nec te d with several forms of social deviances, most1y among o1der 
juveniles who const1tued gross of offenders. Polish researchers emphasize 
such factors like al,coholism in the fami1y, broken homes due to divorce 
Ol' other causes, short-comings of school syśtem, which resulted in 
occurence of street-groups of youngsters, mostly characte!l'ized by short- 
-run hedoni
 or manipulation of violence as a method of gaining status 
(e.g. hooliganism's groups, so-called "git-men" groups).25 Because of such 
occurences, the Criminal Code of 1969 has distinguished a category of 
. group rape (requires minimum three offenders). The group rap es have 
been usuaIly committed by street-corner gangs of juveniles, and accounted 
for slight1y below 20 percent of aIl rapes committed. This aggravated 
category of ratpe is subject of 'severe punishment, as well as produce.s 
a great deal of'preventive efforts of the Mi1itia. 
Within the broad category of crimes against property, the robbery is 
considered as most serious crime. The use of force against the person, as 
the method of taking property, no doubt contributes to this evatuation. 
In regard to weighting the seriousness of robbery there are some varia- 
tiOll1s. For example, a British offidal report has stated: 


T.here may be no legal distinction between a bank holdup by an organized 
gang, a bagsnatching in the street, and the action of an adolescent bully who trips 
up a smaller boy and steals his pocket money.26 


To avoid c1assifications of less serious offenses as a robbery, the Polish 
Criminal Code of 1969 has distinquished a category of arrogant theft, for 


21 FOr details see: A. G r z e ś k o w i a k, Kara śmierci w polskim prawie kar- 
nym [Death penalty in the Polish criminal law], Toruń 1978. 
24 SeeL. R a d z i n o w i c z, M. E. W o l f g a n g (eds.), op. cit., p. 229-230. 
25 See, fOr example, A. P a w e ł c z y ń s k a, Przestępczość grup nieletnich (De- 
linquency of juvenile groups), Warszawa 1964; M. L i p k a, Zjawiska patologii 
spolecznej wśród mlodzieży [Social pathology among juveniles], Warszawa 1977. 
28 Quoted in Criminal Statistics, Wational Institute _ot Mental Health..., p. 4.
>>>
Criminality and itscontrol in Poland 


91 


example a bag-snatching in the street without using force Ol' threat 
against the person, which is c1assified as larceny, not robbery. This 
distinctiolIl seems to beproper, if wre are to cateforize orimes according 
to their seriousness (soc'ial danger Ol' harmfulness).27 
Poland has socialist system of economy which results in the predomi- 
nation af public, mostly state investment and property. That is why in 
the whole category of theft, offenses against public property predomina- 
ted. However, over the recent ten years it can be observed a diminishing 
trend in disparity between the two categories: crirnes against public pro- 
perty have relatively decreased while crimes aga1nst private property 
have increased. 28 It seems connected with the growth of private property 
which leads many offenders, e.g. burglars, auto-thieves, to turn their 
attention to private property. That is why attemps to improve of private 
prope!l'ty plrotectiolIl have been :rłecently oooe!l'ved both iamKIDg citlizens and 
the law enforcement agencies. 
Among other crime categories one s
9-uld mention crimes against 
public safety. While causing public danger Ol' catastrophe (Le. cierail of 
trains) are statistically very rare, accidents in roads have became growing 
problem. It is due to ratpid growth of the number of cars and other motor- 
-vehicles (mosUy moto-cydes): ]n 1961 im Poland lWere 3.7 milliOlIl motor- 
-vehic1es, aoo by 1974 the numbeirof motor-vehicles inareased of 184°/0. 
In that period! thle I1IUmlber of tra:ffic aocd.dents iIIlcreaJSed :f!l'om 23,986 up 
to 52,244. 29 
It should be explained that only causing serious traffic accident 
which resulted in death, bodily injuries Ol' serious property damages is 
considered as crime punishable by the ,court. Other traffic violations (e.g. 
speeding, driving a mator-vehic1e under influence of alcohol Ol' drugs) 
are subject to procedure before the collegia (see comments on Tablel) Ol' 
may be punished by the Militia allowed to impose fine-tickets. 
Category of erimes against administration and functioning of justice 
system (see Table 3) embodies such offenses Uke: assa'lllt a mi1itla Ol' other 
aJuthordty office!l', fal:se aocusatrian, false testimOl1'lY by a witness, bribery, 
and forgery of a document. The first and the last 'offenses have been most 
£req'llent alffiong them. 
One shou1d mentión yet crimes against fami1y and juyeniles, among 
27 In American literature a sophisticated scoring system of crime weighting 
has be,en developed by Th. S e Iii n and M. E. Wolfgang (eds.), op. cit., 
p. 167-175. 
!8 In 1963 crimes against private pro perty accounted for 22.1% while crimes 
against private property for 13.1%, and by 1973 the two categories became almost 
equal (20.3% - 19.6%). Cf. L. Le r n e 11, op. cit., p. 245-246. 
29 J. P o lon y, Wypadki drogowe, [Traffic accidents], Warszawa 1978, p. 13 
and 222.
>>>
92 


Andrzej Marek 


which typical have been: violations of alimony duty, child a.buse and 
indulging in a1cohoI ci adclescents. In respect tO' familyprotecticn it is 
very important estabUshing in 1974 a public alimonial fund,30 which caD. 
be used when the person obliged to pay 3.limony is avoiding a job. Of 
course, persistent avoiding tO' support family by alimcny payments consti- 
tues a crime and is punishable under the law (Art. 186 of the Criminal 
Code). The publicalimonial fund ceTtainly satisfies dert1:ands cf those who 
promote'deveIcping cf victimoIcgy, and safequards the victim protection. 31 


FORM8'QF CRIMINAL ACTIVITY 


Crime in general ccnsists of large variety cf offenses, the characteris- 
tics of the cffenders and their victims, and the techniques which are used 
in crime perpetratii:
n. Some crimeshave been committing by crim'inals 
cperating alcne, SQme by criminals who are organized in what i5 called 
the behavicT system in crime. Such system 1:S ccnsidered to be an inte- 
grated unit which inclucles joint participation cf individuals, social rela- 
tionships am;ng them, spedfk mQnner cfthe crime perpetration, common 
interests and feeling ci identification of those whO' are direci participants 
in it. 32 
Presented Table 3 shows categories of adult crime dxawn from the 
court statistic. Most of them have been committed by individuals 0r 
small grroups ot offeIJIders. TypicaI form of oq
aII1fi:ziatiiOn is an associa.tion 
of small groups of crimipals fcr the execution of crimes, which also 
stabilized patterns of avoiding the detection and mutual aid. It may be 
illustrated by grcups cf thieves and stclen prcperty sellers. It has been 
observed forms of professionalization in theft and burglary, however 
thieves and hU!l',glai"s usually pTlefe!l' to . operate alone Ol' in small groups 
of conspirated persons. 33 ' 
In some countries, especially in the United States and Italy, has been 
observed sophisticated forms of criminal organization, called the' Mafia 
Ol' Sindicate. The ccre of organized crime activity is the supplying of 
illIega1 good:s and services - gambłiing, prdstitu:tiOln, pornography mater- 
ials, narcctics, and also infiltrationcf legitimate business and tabor 


80 The fund was introduced by the Act of 18th oi July, 1974, Journal oi Crimi'- 
nal Law of the Polish P
ople's Republik, [Dziennik UstawI, No. 27, item. 157. 
, 81 For references see: 8. S c h a f e r, Victimology: The Victim and His Crimi- 
nal, Reston: A Prentice-Hall Co. 1977 (Chap ter 3: Compensation and Restitution to 
Victims of Crime). ' 
12 Cf. E. H. S u t h e r l a n d, D. R C r e s s e y, op. cit., p. 278-281. 
sa See Z. B o Ż y c z k o, Kradzież kieszonkowa i jej sprawca, [Pockettheft and 
its offender], Warszawa 1962; i d e m, Kradzież z wlamaniem i jej sprawca, [Burg- 
lary and its offenderJ, Warszawa 1970.
>>>
Criminality and. its control in Poland 


, 93 


racketeering. 34 A natianwide criminal 'Organization comparable ta that has 
nat. appeared in Paland. Illegal gaods andservices have neverdeveloped 
, in larg e scaIe due ta histarical interdictions, and by now-due to strict 
marketcantrol by the state agencies, includingcustom cantra} which 
prevents importing of iHegal goods in larg er scale (Le. porno gra phy 
materials, narcotics). After adapting in 1948 theablition system, pras- 
titution is not punishable which prevents eX'panding. illegalorganization 
far these services. The phenomenon is considered quite 
 seTiaus, even 
thaugh the number af prostitutes known to the Militia has not exceeded 
10,000. Since it iseasy to purchase a1cohalic beverages in state"'Owned 
stores, the illegal supplying afalcohal has na raam ta extend. Hawever; 
abusing of alcohal still co]lsists a very seriaus problem, much graver than 
using af narcatics or drugs. 35 
Itseems that mastsophisticated. criminalorganizations thiithave 
occured are smuggling the currency ar artifacts of historical value thraugh 
the country border land arganized theft afpublic praperty. While the first 
category occured Tather rarely, the second haspr'aduced seriaus prablem 
regarding ta criminological investigations and the law enfarcement. 
Persans engaged in stealing the state-owned property afe us
aliythase 
of the pósitian af trust who menage Ol' safegu81'd the praperty (so':called 
"white-collaT oriminals"). The farms af committingthe crime are fre- 
quently embezzlement, fraud ar fixing aperations recards far the purpas
 
of snatching a large sum af maney. That is also ah ordinarypilefering af 
money af thase who are 'On the duty of regular emp
ayees (workers a.nd 
sellers). It should be interesting t'O state that some theoretical explaratians 
made in Ameritan literature, like Cressey's theory of embezzlement and 
Syikes and Matza theary of techniques of neutraliiation 36 may 
e useful 
in explaining the embezzlement and employee pileferage. also in Polimc.i, 
as it was stated in aur literature.: 17 


84 See,for ex ample, The Challenge of Crime..., (Chapter 7: Organized ;:rime); 
D. H. H e r m a n n, The Nature and Control of the B'lłSiness and Corporate. Acti- 
vities oj Organized Crims in the United States. May 1978 (paper pr
sented at the 
Seminar .on Organized Criminality held in Sircausa, Italy); P. Para d i so; La 
Criminalitd Organizzate e Ze sue Differenti Forme (paper presented at the samo- 
seminar). 
86 See, for example, W. Ś w i d a, op. cit. (Chapters 3 and 4: AlcohoZism and 
Prostitution). 
.8 Cf. D. R. C r e s s e y, Other. People's Money, Belmont 1971; G. S y ke s; 
D. M a t z a, [in:] M. E. Wo l f g a n g (ed.) Crime and Delinquency, 2nd ed., New 
York: Wiley 1964,p. 292-299. 
87 A. M a rek, "Przestępca w niebieskim.. kołnierzyku" 'w . śWietle kryminologii 
amerykańskiej, (Blue-CoUar. criminal in the light of American criIDinology). Ńowe 
Prawo, 2/1978.
>>>
94 


Andrzej Marek 


There is a large variety of forms in organized theft. F:tom tinie to time 
have been discovered criminalorganizations which operate in larger scale 
and cause serious demages both in functioning the economy and for goods 
consumers. As it was disclosed by researchers, some of such crirninal 
organizations operate within the f,ormal structure of the institution in 
which criminals play double-edged role - legal and illegal, while sorne 
others establish something like a caricatare of the formal structure of the 
institution. 38 Although the organized theft is a very serious problem itself, 
it is not a crucial problem in criminality as a whole. I'n 1976 organized 
theft amounted for 1,871 crimes, which is only 1.2 percent of aU crimes 
committed in that year. Of course, we shou1d take into conside!l'ation 
a high dark-figure of these crimes which are difficult to disc10se due to 
c1andestine character of criminal operations. However, it is a problem of 
deficdency of Billy crilmina
 statistics, which cannot be further diooUiSsed 
here. 


DIRECTIONS OF THE CRIMINAL POLICY 


Oontemporary criminal palicy in Poland may be characterized by 
diff
twiO'll of rpenal measU'I'els employed :vn deal.iinJg with criminals. 
This policy was put intro practice in 1970 when the Criminal Code of 
1969 went into effect. Previously, under the Criminal Code of 1932 the 
criminal policy was based upon three measures: imprisonrnent, suspen- 
dence of sentence, and fine which appeared to be insufficient. The 
Criminal Codeof 1969 has enriched the system of penal rneasures by 
introducing a new penalty of restricted personal freedom, which is com- 
munity-based and inwlves unpaid work under supervision,39 and deve- 
loping the use of probation, including the new form of conditional discon- 
tinuation of the criminal prodeedings, which was discussed earlier. Table 
4 presents generai distribution of penal measures in 1968, under the Code 
of 1932, and in 1971 and 1976, under the Code of 1969. I 
Considering figures given in Table 4 we can notice dawnwards in the 
num bers and percentages of suspended sentences and fines. It seems that 
a new penalty of restricted personal freedom has replaced, in some extend 
fines and suspendence of sentences. In addition an extensive use of the 
conditional discontinautions of the criminal proceedings, mostly by public 
pro secu tors, bas narrowed the court possibilities to use fine as a main 
penalty provided foc less serious offenses. Thus an expectation of the 


38 See l. M a j c h r z a k, Pracownicze przestępstwo gospodarcze i jego sprawca, 
[Employee economic crime and its offender], Warszawa 1964. 
at For general references see J. Ś l i w o w s k i, Kara ograniczenia wolności, 
[Penalty . of restricted personal freedom], Warszawa 1975.
>>>
Criminality and its control in Poland 


95 


Table4 
Distribution of main penalties 


1968 1971 1976 
Penal ties I Perce1'1- I Percen- . Number I Percen- 
Number tage Number tage tage 


Death penalty 
Imprisonment 
Suspended sen- 
tence al one or 
for probation 
Restricted per- 
sonal freedom 
Fine 
Total 
Conditional dis- 
continuation of 
the criminal 
ptoceedings 


5 O 
72,349 31 
101,656 45 


9 O 23 O 
60,604 30 48,565 :3"0 
88,837 43 60,879 38 
19,814 10 24,935 16 
34,816 17 24,888 16 
204,080 100 159,290 100 


58,456 
232,466 


26 
100 


40,261. 


30,764 


aJUthors of the OI'liimiinal Code of 1969 that a new penalty of rest.ricted 
personal freedom wou1d diminish the use of confinement has not been 
fully satisfied. It was also d1,te to the crime structure and the increase in 
rłecidivi:sm which forced the COUQ'ts to, use imprisornnent more extensi- 

y. 
Although general situation in criminality is rather favorable when 
the diminishing trend in criminality as a whole i.s considered, the problem 
of reddivism has arised. The rate of repeated crimes increased as follows: 
23.4 % in 1961, 28.2610 ,in 1967, 31.3% in 1971,8i11d 35.1% in 1976. 40 It is 
certain that changes in th,e law, especially the shift of petty offenses to 
the Slight Misdemeanor Code of 1971 (see comments on Table 1) as well 
as extensive use of the conditional discontinuation of the criminal 
proceedings, have lJnf1ruenced the ClOU/ret staJtistics iillsiing the rate of Teci- 
divism. Nevertheless, the problem is considered as serious. Recidivism is 
seen as a "culture-medium" of criminality, iacilitating the spread of 
criminal motives, attitudes, and techniques of committing the crime. 41 


40 According to the Uniform Crime Report, in 1975 there were 64.2 percent of 
repeaters among persons arrested (The Uniform Crime Report..., p. 44). However, 
a thorough study of Daniel Glaser proved that ihe Uniform Crime Report figures 
are exaggerated. AccGrding to this author a "real" number of recidivists can be 
estimated at 48% (including only those who were repeatedly sentenced for the 
crime). See D. G l a s e r, The Efjectiveness of Prison and Parole System, Indiana- 
polis: Bobbs-Merrill 1964, p. 19-20. 
41 Cf. E. H. S u t h e r l a n d, D. R. C r e s s e y, op, cit., p. 75 and 252-254.
>>>
96 


Andrzej Marek 


Recidivism can be approachedbothin term s of its social psychology 
and in terms of failures of the methods of criminal reformation. 42 In 
attempt to preventin:g recidivists f TOm commi.ttirtg subsequent offenses 
after release from prison, the Cl'imi.nal Code of 1969 introduced speciaL 
supervision of releasees. This supervisi()h performed by probation offkel's 
has been imposed in about 60 percent af the released recidivists, and is 
reported to by only pa1'tially successfu1. 43 
Much more higher success l'ate is reported l'egarding to suspende nce 
of sentencefor probation which is supervised by probation officers. The 
percentages reported to be successful are as follows: 86% in 1970, 85% 
in 1974, and 840/0 in 1976. It is also reported a high rate of success in 
parole - 85-90%.4 4 The last figures however, do not always measure 
the rahabilitation effect since a fractian of probationers Ol' paralees aftel' 
the probation period failure cornmitting ah()ther crimes. Nevertheless, the. 
probation and parole seems to be effective in most cases, especially when 
the multirecidivists are exc1uded. 
In comments to recent shift of the policy of crime controlin. the 
United States from a meclical to a "just-desert" orientation, professor 
Marvin E, Wolfgang has stated: 


We now have mOJ,lnting evidence that a small minority of criminal repeaters 
commits a disproportionate share of our violent crime and that if we put more 
ofthese habitual offenders in prison, we might have safer cities. 46 


This is true, but not fora long time, sine e the problem how to prevent 
recidivism in the future still remains. It seems that special supervision of 
l'eleased recidivists, as employed in Poland, which inc1udes guidance and 
social assistance .given them, can be a promising way in preventing l'ecią- 
ivism. 
At the end. o.f thiese oomments, rwe WaIIlt to stlressagailn that in Poland 
the policy of special treatment of reciclivists is accompanied by enrich- 
mant of communitY7"based. measures employed in dealing with first 


42 Cf. ibid., p. 69; D. B. K e n n e d y, A. Ker b e r, ResociaHzation: An Ame- 
ricanE;x:periment, New York: Behavior Pub!. 1973, p. 109-113. 
48 s. p a we l a, ResocjaHzacja recydywistów w systemie nadzoru ochronnego, 
[Resocialization of recidivists in the system of protective supervision], Warszawa 
1977 (Chapter 4). 
44 Cf. J. M a l e c, Udzial społeczeństwa w realizacji zadatr. procesu. karnego, 
[1'he society role in achieving of the criminal process objectives], Warszawa 1978 
(a report on Vth ... Congręss of Criminology of the Socialist Countries held in Zako
 
pane, Poland). 
46 Crime in Amerłca: A Turnaround at Last?, The Reader's Digest, of June 
1977, p. 62.
>>>
Criminal1ty and its control in POland 


97 


\ 
offenders. 46 Among them the most import ant and frequent1y used are 
forms of probation and a new penalty of restricted personal freedom. 
These measures seem to be successful, and in my opinion should be 
deve10ped in the future. 


'-.. 
41 As far as I can see, the similar tendencies have been developing in other 
countries and accepted by criminologists. See, for example: T. Kir a l y, Evolution 
of Methods and Means Employed in Penal Law: General Report on Section 1st of 
the XIth Congress of the International Association on Penal Law, Budapest 1974 
(mimeograph); New Horizons in Corrections by James Mabry. The American Cor- 
rectional Association, N. M o r r i s and D. G l a s e r, [in:] Penology, The Evolu,tion 
of Corrections in America, Sto Paul: West Pub!. 1974 (Chapter 4).
>>>
ACTA UNIVERSITATIS NICOLAI COPERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 111'18 


Department ot Constitutional Law, 
Gdańsk University 


Andrz'\j Pulło 


SOME REMARKS ABOUT AMERICAN FEDERALISM 


c o n t e n t: In t
is artic1e was formulated certain remarks linked with the 
development of federalism in the United States. Special attention was devoted to 
the post-Second World War period. The fundamental problem was, found in the 
determining what federalism is today and wheather it is proper to continue using 
the term "cooperative federalism" to define the practice of federal relations. 


Federałlism, beitng one of the :Eundamental prin1ciples of the rpolitical 
system in the United States, has undergone vet:y esoontial transformations 
alongside with the development of the state. Unlike any other oi the 
remaining principl'es, it was susceptible to the changes in the socia! and 
eoonomic life af the country. It was the most argued and simultaneously 
i.nflammable government problem in the history of the United States. 
The differences błetween the połiticaJ. practice and the oonstitutiDnallaw, 
alI"oU'sed mainY a time opiJrrions aboUlt the dJoW1nfaU of this oldest prirnciple 
in the American political system. 
The intergoveT,nmental relations kept changing 8!S did the vi'ews of 
the politicia.ns, the jurisdiction of the Supreme Court and the convictions 
of scholars. New de:finitions of the relations betwelen the' federation and 
the states originated. A particul8!l'Y animated diooussion and the develop- 
ment of literature could be observed in th'e last severał yep,Ts. After the 
fundamental works of M. Grodzins l and D. J. Elazar 2 there were publi- 
shed many monographies
 of gTeat value and other works 4 as well. Ain 


1 The American System; A New View ot Government in the United States, 
Chicago: Rand McNally 1966. 
II The American Partnership, Chicago: University of Chicago Press 1962; Ame-' 
rican Federalism, A View trom the States, New York: Crowelll966. 
a E. g. C. J. F r i e d r i c h, Trends ot Federalism in Theory and Practice, New 
York: Praeger 1968; R. H. Le a c h, American Federalism, New York: Norton 1970; 
M. D. R e a g e n, The New Federalism, New York: Oxford University Press 1972. 
4 E. g. A. W i l d a v s k y (ed.), American Federalism in Perspective, Boston:, 
Little, Brown 1967.
>>>
100. 


Andrzej Pułło 


increased int!erest in the problematics deaJing with federalism was linked 
among others with the realization of the "creative federalism" and "new 
federalism" programmes. 
The changes which took place iiIl the intergoviernmentaLrelations had 
cE:'rtain influence on the Supreme Co!!rt. Begining with the year 1973 
there may be noted in its jurisdktiQ,ń a tendiency tO' revive the cQII1stitu- 
tiQnal meaning concerni:ng the divisian af competences between the fede- 
ration and the states. Bearing in mind the fact that every more perma- 
nent change in the jurisdiction af the Court is on the whole a canfir- 
mation af the changes that have taken place 
n practice, we may maintain 
that the American federalism is on thie verge of mOre serious tral11sfor- 
mation in the political system, which cannat bę linked. with only the 
"revenue sharing". It is the proper opportunity to formulate certain 
remaIDks Unked with the lexisting deveJopment of federalism in the Uni- 
ted States. . 
One m
y fwnd in the Amell'ican Hteratru:rle mal11YV'a!rious ways af 
diividing i!nitlo periods the evoolUlmoo orf federlaHsm in the United 
S'bates. The div'ersity of views is most appatrent in the assessment of the 
post-Second Wor1d Wwr pm"iod, and the fundam€lI1it:aJ. problem is 
f'OUind in the deterrmdmdng what f,ederalism is today and wheath1er 
it is prQper tQ oonrtinue us!iiI1g the tecrm "cOlOpeT'1
tive federalism" to 
defi!ne the practice,s of fedleral. trelatiJcms (trelationl'3 between a11 levels orf 
fedetral srt;tructUlI'e). 
BefQre exrplaindng th'ese problems., let us present the problematics 
dealing with the evolutiQn of i'ederalism in a general out1ine, and, 
speaking more precisely, the federal-stat'e relations. This problem is linked 
with certain historkal events quite obviously. Enumerating the most 
outstandi.ńg ones, we don't maintain that iI!1 these defined moments. the 
practice OIf federal relations chartged inunediately. We just simply per- 
oeive thei!r influ,ence 0IIl the further deve,lopment of the principie we are 
interested in. They a1'e: the r,eplacing of the Federalistls by the Republi- 
e,an! in 1800, the outbreaik af th'e Civil War in 1861, the adQption af the 
XVI Aroendment to the ConstitutiOlIl in 1913, the taking aver of the 
presi:dential office by F. D.Roosevelt in 1933, the introduction of the 
"trevenue sharing" program in 1972. 
The significancle af these events is various, but they have not been 
selected on the base af one criteriQn, The periods marking the develop- 
ment of federalism, elimtnated an their baSe have not given a satitsfactory 
pdcture. As it is easy to obse'I've, the jurisdictian of the Supreme Court, 
called "the arbiter af federalism", has not be taken into consideration 
at a11.
>>>
Some Remarks about American Federalism 


101 


It seems that the most proper division is the O!ne based on the cri- 
terion of the constitutional significance Qf the principie cQlIlcerning tbie 
dividilllg of authority between the federatiQn and the states. 5 It is an 
institutiO!nconsidered tQ be the most fundament al anie for the federal 
state tQ exist. The manneT Qf realizing ił in practice is the natural base 
to classify the fQrm Qrf a federal state and the. division of theperiQds of 
the develQpment of the particular federal systems. 
The period af the New Deal was the turning paint in the United 
States as regards the principie of division O!f competences. The jurisdic- 
tiQnO!f the Supreme Court in the yeaTls 1937-1941 6 guaranteed success 
fQir the future Qf tbie centralistic policy of the president and Congress. 
It was a turning pO!int af signifiC'alllice nQt Qnly fm poHtical practice. 
A radical change has taken place inthe understanding of federalism. The 
criteTion of thesovereign authority Qf the states in the mattlers left to 
their exc1usive oompetence, has been deprived Qf its fundamental signi- 
ficance for th1e survival of the prmciple of £ede'ralism in the political 
system of the United States. However, Qwing to the oonsiderable diffe- 
renoos in the organiza:tiQIIl of the public authorities in the particular 
states, the applying Qf tbie definition federal:ism has nQt been abondoned. 
Swchmeasures ha,ve been taken as have ałready been utihzed mQre than 
once in sciences about the stat,e and political practicłe. 7 In face of the 
factual quality and quantity changes- justifying the doubt!s as tQ the 
faxther existence of federałi,sm, the heretofore practilce of 
ederal re- 
latiQns bas beencalled "dual federalism", andthe new prarctice has been 
defined as "cooperative federalism". 
Of CQmse, the new practice did nQt oome intQ beimg suddenly and out 
of. nothing. Many changes annQU'nced its birth: the views and activity Qf 
Th. RQQsevelt and W. Wilson, the adoptiQn of the XVI Amendment, the 
obliteration of competition and separation of states traditions, the deve- 
IQipment O!f federal subsydies, the legislatiQn O!f the First WQrld War 
periQd. There 'existed then, however, barriers which did not per mit the 
federal gQver.nment tQ participate mQre extensively in the executing 


5 Extensively about the evolution and significance of the principle in: A. P u ł ł o, 
Podział władzy między federacjq a stanami w Stanach Zjednoczonych Ameryki, 
Warszawa-Poznań-Toruń 1977. 
8 E.i. included among jurisdictions We s t C o a s t H o t e l C o. v. P ar r i s h 
(300 U.S. 379), N a t i o n a l L a b o r R e l a t i o n s B o a r d v. J o n e s a n d 
L a u g h l i n S t e e l. C o rp. (301 U.S. l) a n d U. S. v. Da r b y (312 U.S. 100). 
7 See the origin of the concepts indirect and direct democracy. That what was 
real democracy, and impossible to be realized, was called direct democracy, and the 
practice of i'epresentation,' meaning something quite different, was called indirect 
democracy.
>>>
102 


Andrzej Pułło 


of state authority. The greatest baTrier was creatłedby the jurisdiction 
of the Supreme Coua-t. The comtitutional division of competences was 
a respected principle as long as they differed in their interpretation by 
the three branches of federal government. When the difference was obli- 
terated, federalism changed its visage. The contention that it has ceased 
to be federalism would, however, bIe risky be:ause, among others, one 
could not exclude the possibility of a renewed interest in the future of 
the Supreme Court and other bodi1es of the Union in the constitutional 
provisions prote:ting the state's rights. 
Thus the fundamtentał divi,sion in the development of the federaI state 
and federalism is the differentiationbetween the dual federalism and the 
oooperative one, Owing to the vaxious charaders of these concepts and 
the change in undeTstanding the word federali:sm itself, the farther di- 
viJSion of these periods can be caTrred on only by . applying different 
criteria. One of the more important premlsses' of division fot the dual 
fedeTalism I period axe the changes in the distribution of compet'ences, 
QlITising from the amendments to the cOIl1Stitution, Ol' from the juris- 
I 
diction of the Supreme Court. On the other hand the point s dividing thle 
development of the cooperative federalism period may be found in the 
establishing of new institutions OT the distinct changes in the policy of 
federalism (in the direction' of decentralization Ol' the opposite). 
Thus the period of dual federalism is divided by the bringing into 
force of the XVI Amendmtent in 1913, and that of the coopel'ative fede- 
ralism by the i!l1troduction of the idea of "revenue sharing" in 1972. In 
the first sub-period of the yeaJrs 1789-1913 one should dilScern the period 
of the 
ipening of thte federal ,system, e.i. the yeal's 1789-1819. Some 
8Iuthors may consider the year 1800 to be the more proper one. Accord1ng 
to us, the more significant evidence of the establishing of the fedetra,l 
system i8 the situation, which allowed the Supreme Court to render two 
fundamental dtesicions in the case of M c Cu 11 o c h v. M a l' y l a n d S 
and Gibbons v. Ogden.. 
The most general division of the pe'riods of the development of fede- 
ralism in the United States is as follows: 
1. Dual federalism (1789-1937) 
1) Thte soLdifying of the federal systelm (1789---:1819) 
2) The "classic" age of federalism (1819-1913) 
3) The period of changes (1913-1937) 
II. Cooperative federali:sm (1937-?) 


8 4 Wheat. 316 (1819). 
· 9 Wheat. 1 (1824).
>>>
Some Remarks about American Federalism 


103 


1) The period of progressing centralization (1937-1972) 
2) Restitution of equilibrium (1972-?) 
This division can be variously "detailied". It may concern primarily 
the "golden age". We shall not do that because the divisio.n into periods 
is sufficiently helpful f 0,1' a more exact and criticaJ. glance at the. develop- 
ment of thle American federalism 
ter the Seoond Worki War, and this 
is our maIn puxpose. 
The cooper
tive federalism Is opposite to dual federalism.1° It has 
been acknowledged to, be impossible to, differentiate distinctly thle func- 
tiOOs aiIld cQmpetences of the federal and state govermnents and, in con- 
nection with this, thle relations between them must be ba:sed o,n a close 
cooperation, and not on independence. Such theory ls a mo,tivation f 0,1' 
the process of centralization of power not relying on the constitutional 
princirple of division of oompetences. 
Not disputing the nec'essity o,f such signific'ant changes in the poJ.itical 
_ life af the United States, we o,nly draw attention to the fact that not 
oooperation but centralization was the essence of the changes in the 
federal system. Cooperation developed throughout the who,le period of 
the history af the political system in the United States, e.g. "land grants" 
were a1!l'eardyknown before Tatyfying the Constitution, and the oontem- 
parary "grants-in-aid" developed as learly as the second half of the XIX 
century. We maintain, therefore, that the term "cooperative federalism" 
i:s not an exact ane and conceal,s the eSSence of ttle changes of the New 
Deal and the years that fallow It. It lTeminds one of bistory witha defi;.. 
nitio,n of the kind of government entered in the Oonstitutiion in the 
perio,d of the struggle to ratify it. Oalling a state a federal o,ne was con- 
tradictory ta the co,ntemporalI'Y meanlng of that word. This was done 
fo,r the purpo8es of tactics to conceal the essence of the new union. ll 
CJoser to the real picture of the govemmental relatiohs would be the 
tenn "neo,federalism" (Ol' new federalism). That what used to be the 
most IimrpOll'tant feature ofa fedleral state, e.i. the division of powers 
between a feder'ation and member states acoomplished in the Comtitu- 
tion, has ceased to be of any ,practical s:tgm.ificance. The esSence itself of 
a federal state has changedj instead ,of dividing authority it is pedormed 
in oommon and responsibility iJS common. It seems that the term neo- 


10 See in Polish literatureon this subject: w. S u c h e c k i, Teoria federalizmu, 
Warszawa 1968, and W. S a d u r s k i, Federalizm kooperatywny w doktrynie i prak- 
tyce amerykańskiej, Państwo i Prawo, 5/1974. 
11 See: H. C. H oc k e t t, The Constitutional Bistory of the United States, vol. 1, 
New York: MacMillan 1948, p. 227, and M. D i a rń o n'd, The Federalist's View of 
Federalism, [in:] G. C. B e n s o n (ed.), Essays in Federalism, Clal'emont: Institute 
for Studies in Federalism 1961, p. 23.
>>>
104 


Andrzej Pułło 


fłederali:sm reflects the significance of the changes that have taken place 
in the American federalism, and apart frO'm that we have observed that 
cooperative federalism was written about before the Supreme CO'urt 
acknowledgied the new form of intergO'vernmentalrelatiO'ns, ej. befO're 
ruling out the significance of the CO'lnstitutional divisiO'n of powers bet- 
ween the federatiO'n and the states. 12 
In spite O'f the above remaJrks we do nO't c1aim that federalism is nO't 
ailly IDOre the fundament al pri:nciple of the PO'litical system of many. 
contemporary states. It cannot, hO'wever, be understood in the traditional 
way. F'ederalism is today a phenO'men Ol' process based on the reaHzation 
of the tarsks of a state by tWO' cO'nstitutiO'nally independent from each 
other political systems: the federai and r
gional ones. This independence 
is fO'und first1y in the separatłe appoihting of state bodies, ej. indepen- 
dently from the other system. Thiis requires as well the participation O'f 
member states(regions) in the decisions as regwds changes in their 
borden lines, as well as a constitutional entlry ąbout the competences of 
both systems, and this is not tantamount ta divisian. 
This is a 'conceptiO'n cO'mmO'nfar the experience of all the contem- 
porary federal states. The practdce of the politi:cal system cannot any 
more return to the model oorresponding ta the dual federalism. There 
is no need thereiare tO' writetoday about caoperative federalism, fede- 
ralism has simply reached a higher stage af d!evelopment. There is only 
O'ne federalismand this idea has 'been granted a braM enaugh significan- 
ce. The present stage O'f its development will not end until the member 
states abolish "any substantial bargaining capa'city in relatiO'ns to the 
Centre".13 
Thus we express doubts as tO' the reality of the assertion that tHe 
oooperative federalism 'does not exist in the United States, that the ne'W 
practice must be called O'theTWise. 14 It is true that that practice changes, 
that it canbe defined by means O'f certain sl(;)gans, butall this takes place 
i:n the frames of cooperative federalism. Especially the changes leading 
towa\t'd declentralizationshauld not tend to change the definition "coope- 
rative fedel'alism" far O'ther ones. 


11 See: J.. A. B u r d i n e, Ńational-State Cooperation, With Special Reference 
to Texas, Dallas: Southern Methodist University 1935, p. 24. Even in Texas it was 
thought then that "broader development of national-state cooperation would be 
a step in the direetion of "more perfect Union", ibid., p. 25. . 
18 G. F. Sawer calls this state "organie federalism". G. F. S a we r, Modern 
Federalism, London: Watts 1969, p. 125. 
14 R. C. Wo o d, The Federal Role in Creative Federalism: The Ne;x;t Step 
Forward, [in:] D. E. N i e o 11 (ed.), Creative Federalism, Washington D. C. 1967, 
p. 34; C. J. F l' i e d r i e h express es such a viewpoint as well - op. cit., p. 8.
>>>
Some Remarks about American Federalism 


105 


Just lik e the era of dua1federalism, the period of cooperative federalism 
can be divided into sub..:periods. We have aLre-ady singled out earlier the 
period of progreSiSing eentlralization and the period of restoring equilib- 
rium. It is probably the most fundament al and general division. The 
beginning of the 70-8 is a certain turning po.tnt in the evolution of the 
contemporary Amer1C'an federaHism, not anly becaU'se of the triais to 
introduce the financial equilibrium on the way of "revenue 8haring". 
In the 60-s the centralistic tendencies in the intergo
ernmental re- 
lations attained an exeptionally threatening scale. The farther extension 
of the "grants-in-aid" systlem seemed to be dangerous. The increased 
activity of the federation in the local matters released the states them- 
selves from responsibility IDOre and more. Although the federal govern- 
ment had to its .disposal adequate financial means as wen as technical 
one:s, it could not lead an activity that would satisfy fifty, oftenvery 
various, lairge local communities. 
In the period after the Second World Wair, partic1arly in the 50
s 
and 60-s, matters dealing Wlith the competences of the federation and 
the states became a problem of politics and not of the constitutionallaw. 
The constitutional priridple of the diviston of competlences was treated 
as only a historical institution. They wrote about the burying of the tradi- 
tional doctrine of Am€rican federalism. 15 The almost unlimited compe- 
tences of the fedieTation did not originate only from the policy of the 
Oongress and the Bresident. It was the Supreme Oourt, as it was pre- 
sented in the report of the Kestenbaum Commission, that occupi'ed the 
most centralistic position.1 6 
In this situation essential' changes in the American federalism oould 
occur O'nly through the interest lin the mattlers of decentralization of a11 
the subjects of the federal authority. Such an en1ivenment is beipg dis- 
tinctly observed in the prresent 70-s. The 
eforms tending to strengthen 
the states are not limited on1y to the activities in the capital Washington. 
The growth of the initiatives of the state governm1ents, their reformator y 
aJCtivities, and even the international activity, allow to speak today about 
a greater maturity and responsibility of this level of the federal struc- 
ture. 17 


15 See e.g.: J. L. S u n d q u i s t, Mak.ing FederaHsm Work, Washington: The 
Brookings Institution 1969, p. 6. 
16 Commission on Intergovernmental Relations, A Report to the President Jor 
Transmittal to Congress, Washington: Government Printing Office 1955, p. 23. 
17 Interesting remarks are inserted in the article of J. J as k i e r n i a, Trendy 
rozwojowe federalizmu amerykańskiego, Ruch Prawniczy, Ekonomiczny i Socjolo- 
giczny, 3/1977. See idem, Międzynarodowa aktywność stanów USA, Sprawy Między- 
narodowe, 12/1975. .
>>>
\ 


106 


Andrzej Pułło 


Particular attention should be atta'ched to the changes in the trends 
oi the j't1!ristidction ot the Supreme COUlrt. l8 Th1e jU!r,isdiction ot 1973 in the 
ca:ses G o l d 5 t e i n v. C a li t o T n i a l9 and N. Y. S t a t e D e p a r t- 
m e n t oi S o c i a l S te r v i c e s v. B u b l i n 0 20 are a limitation of 
a very centralistic court doctrine "congressional preemption" expressed 
in 1956 in the opinion in the case of P e n s y l van i a v. N e l s o n.n 
These changes in the vitews of the judges even then foretold a gravel' 
reorientation of the Court. 22 The continuation of this line oi jurisdiction 
is fuuJnd e.g. :iJn League of Ciiies v. Usery,23 whetre it was 
aolm.owledged aIS cootiramctO!l'Y with the Conistdtutian to extlend the de- 
cisions of The Fair Standards Act of 1938 on almost all employees of 
states and their political subdivisions, executed by the Congress in 1974. 
In the opinion of the Court it was stressed that 
...Congress has sought to wieI d its power in a fashion that wouId impair the 
states' ability to functlon effectively within a federal system. This exercise of 
congressional authority does not comport with the fe dera l system of government 
embodied in the Constitution. 24 


These and similaT changes in th'e jurisdiction in the Supreme Court 
are proof that the reformatory advancements of the executive branch 
and Congress were not only a casual adivity. A certain' interest i!n the 
constitutional principlte as to the division of powers between the fede- 
ration and the states is a confiTIIlation of the decentralization trend :iJn 
the int
rgove.rnmental relations in the United States. 
The period of progressing centralization isolated by us was not, of 
courSe uniform iJn the understanding and development of the inter- 
govelrnmental relation. One may single out in it the following periods: 


18 About the political role of the Supreme Court: W. S z y s z k o w s k i, Sąd 
Najwyiszy Stanów Zjednoczonych, Warszawa 1969, p, 44, 181-185, 214-225, 
11 412 U.S. 546. 
10 413 U.S. 405. 
11 350 U.S. 497. 
ft See: A. P u ł ł o, op. cit., p. 147, 
II 426 U.s. 8a3 (1976). 
14 In another part of the opinion there was 'following observation: "Thereare 
attributes of sovereingty attaching to every state government which may not be 
impared by Congress, not because Congress may lack an affirmative grant of le- 
gislative authorityto reach the matter, but because the Constitution prohibits it 
from exercising the authority in that manner". In many earlier opinions the Court 
refused to construct any state immunity from congressional regulation. The culmi- 
nation had been thought to be M a r y l a n d v. Wi r t z (392 U.S. 183, 1968) in 
which the Court upheld the constitutionality of applying the federal wage and hour 
law to nonprofessional employees of states operate schools and hospitals. The Court 
sawa elear cennection between working conditions in these institutions and inter- 
state commerce.
>>>
/ 


Some Remarks about American Federalism 


107 


interventionisn1 combatting the effects of the Great Depression, the 
emproving of thte federal-state cooperation, as well as the growth óf 
the activity of the federal governme'nt and the realization of the slogan 
"creative federalism" .25 
It is not difficult to notice the dependence between this division and 
the changes in the America,n party system. The first period is that of the 
Democratic PTesident F. D. Roosevelt, the second onle is the interest in 
. the rights of the states of the RepublicaiIls, the third one i,s the realization 
of the programs of the Democrats, e
ecially by Johnson, the creator of 
the conception "creative federalism". 
The tuming point that occured in the beginning of the 70-s was con- 
nected with the activity of the Republicans, but thte furtherdevelopmoot 
of the intergove1'nmental relations will not be 50 depended on the chan- 
ges in the party system as it has bean 50 far. The process of decentrali- 
zation has become, advanced enoUigh in theactivities of many centres of 
state power :far thereversal of this tendency to beoome"a thteat of losing 
popularity and political influence. This does not mean that the present 
development of federalism will be an unvarying process, without any 
changes in the system and politics that would allow in the future to 
execute a new division into periods in the development of federalism 
in the United States after the Second World War. 


26 D. J. E1azar has written about Crisis-oriented Centralism (1931-1945), Non- 
centralist Restoration (1946-1961), Concentrated Cooperation (1961-1) - The, Sha- 
ping of 'Intergovernmenta1 Relations in the Twentieth Century in: Intergovernmen- 
tal Relations in the United States, The Annals 01 the American Academy 01 Poli-' 
tical and Social Science, Philadelphia 1965, p. 16.
>>>
, 
, 


---
>>>
ACTA UNIVERSITATIS N.ICOLAI COPERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-S}OŁECZNE - ZESZYT 108 - 1979 


Chair of Criminal Law. 
.nd Criminology 


Sławomir Redo 


THE NEW CRIMINOLOGY: THE PROBLEM OF ETIOLOGY OF CRIME 


c o n t e n t: Intro
uction. Basic assumptiops. Socio-economic system and crimi- 
nality. The role of personality. Final remarks. 


INTRODUCTION 


In the late 1960's Bind the begilIlTIii,rig 0'£ 1970's in the United Sta:tes 
and Great Britain łł nerw diredion oi investigating the roots 0'£ crime has 
app1eared. Us representatives 'analyze theetiołogy of crime on the. basis 
of the dialectic mater,ialist philosophy, formulated by Marx and Engels 
and later deve-Iopedby theif ,followers. 'This "new", "cdtical"'or "radical" 
criminology has rejected the views of the positive school of criminology 
. proclaiming a c0J.1sensual rnądel ,o.f 
iety, deprived Qf antagonistic con- 
. tradictions. 
Since the positivist appt'ołłch :seems to be prevailing in Western cri- 
mmology, another, theory, a coruf1ict one, lis łłotual1y situated outside of 
the mainstream conceptions. Being a eonf1ict theory itself it al$o remains 
in conf1ict with thie' hegemonie domination of the liberai school, which 
it .ehałlenges. 1 Radical, Marrxist crimiInology foculSes n'either on crimes 
nor on criminals, as do conventional criminologist, but raiher on the capi- 
,talist system łłS a whole. Such an approaeh is a new important thruSt in 
'the man's search for the,roots of criminality. 
'The relatively high crirne rate in some Western communities, as com- 
'płłred to that of -tbe. socialist countries, creates the need to find a new 
means to deal with thi,s concern. 


As necessity is the mother pf invention, it is not surprising that public anxiety 
about {:rirne has 
t'imulated American sociologiSts and other social scientists to cri- 


, . 
1 T. P l a t t, Prospects fOT r,adicalcriminology i1t the USA, [in:] Critical' cTimi- 
nolopy,' ed. 'by I. T a y lor, P. Wal t o n, J. Yo u n g, Lo
don:, Routl
dge and 
Kegan Paul 1975, p. 95.
>>>
110 


Sławomir Redo 


tically analyze existing theoretical perspectives utlized to comprehend criminality. 
A second factor in the revitalization of criminological theory has been the growing 
disaffection of sociał scientists from established institutions.. 


Since the Marxist paradigm in the study of criminality is practically 
utilized by the criminologists from the socia1ist states, it is of interest 
to take a deeper look at the views of the representatives ot the new 
criminology and to examine them. One should notice that critical reac- 
tions to the consensus thleories are not homogenie. Several conceptions 
may be found, of which owy some would be recognized as simila.r to the 
variety occuring in the socialist countries. 


BASIC ASSUMPTIONS 


A radkal theory or perspective toward crime attempts to expIaiT! 
crimes lexistence in the Western hemisphere by its socio-economic struc- 
ture based on appropriation of laOOr power £rom the working class. The 
capitalist mode of production depends on the "surplus vałue", on unpaid 
labor.Being itself a system of eX'ploit'ation, it creates material cond,itions 
for the bourgleOise class and the WO!l'king c1ass: it permits the opp,ression 
of the lu m p e n, p role t a r i a t 
unfravor,able eOOno
c condi- 
tions for them. 
The cI.assicS are often quoted and :interpreteq. by the 'PiE!W cr,imi!no- 
logist: 


If the inlufences demoralizing to the working-man act more powerfully, more 
concentratedly than usual, he becomes an offender as certainly as water abandons 
the fluid for the vaporous state at 00 degrees Reamur. Under the brutal and bruta- 
lising treatment of the bourgeoisie, the workin-man becomes precisely as much 
a thing without volition as water, and is subject to the laws of nature with pre- 
si$ely the same necessity: at a certain point all freedom ceases.' 


For Marx c.rime is an expres
on of "thle st\ruggle of the isolated indi- 
vidual ,against prevailing conditions" while aIso being a struggle conditio- 
ned by those prevailing conditions. 4 A basic for the new criminologists 
seems to be the assumption that economic factors determine existence of 
crimina1ity in the Western count\ries. As long as t
 sociopathological 
, phenomenon is treated in functional terms by the conventimaI economic 


I W. C h a m b l i s s, M. M a n k. o f f, Whose law, what ordeT: a conflict appro- 
ach to crimino/,ogy, New York: John Wiley and Sons 1976, p. VII. 
I F. E n g e ISiThe conditions 01 the wOTking class in England in 1844, London: 
Allen and Unwin 1950, p. 130, quoted after: I. T a y l o:r, P. Wal t o n,
. Yo u n g, 
,The new criminology: lOT a social theory of deviance, London-aoston: Routledge 
and Kegan Paul 1973,p. 210. 
4 I. T a y lor, P. W'a l t o n, J, Yo u n g, op. cit., p. 215. 


/ .'
>>>
The New Criminology: the Problem of Etiology of Crime 111 


analysis, without getting into the underlying causes of crime. it remains 
an integral part of the system, it is a "normal" part of the society. 
"A Marxist analysis of crime, im contrast, assumes that thel'e is asocial 
order in which Cirime is not inevitible".5 From the stand point af socialist 
criminology at least twa problems should. be takten into consideration: 
1) The new criminologist's interpretation of the role of the economic 
factor as the cause of criminality, 
2) The role of the personality factor in creating criminal behaviar. 


SOCIO-ECONOMIC SYSTEM AND CRIMINALITY 


Wie can distinguish at least two conceptions regarding to the inter- 
pretation of the role of the econOin:lic faetor. An older one was locigoo by 
W. A. Bonger in Criminality and economic conditions, published in 
English in 1916. 6 Since this author i,s irega1rded nowadays as the first 
Marxist criminalogist in the Western warid, his work is treatled as a star- 
ting point far further ex:ploration undertaiken by the contemporary re- 
p.resentatives af the critical approach. In. his preface to the American 
edition Bonger WTote: 
I am fully eonvineed that my ideas about the etiology of crime will not be 
shared by a great many readers of the Amertcan edition. As far as I can see, in 
the English-speaking eountries the causes of crimina1ity are sought in man rather 
than in his sorroundings. 7 
The Dutch author is af the opinion that the capitalist system is held 
together by force, ratherthan by the consensUis of a11 groups. Thus re- 
lations are based on exploitation and force, not on cooperation and trust. 
Humansare Ibasica11y pleasure-seeking, but pleasures in the capitalist 
societies requires having lat5 af money. In this situatian man concentrates 
on himself - beoomes selfish. He is not interested in the neleds of other 
men. In their pursuit Of pleasure, both the bourgeoise and the proletarian 
become "more capable of crime" as, they' lose their aJtruistic traits. 
Paverty resulting from capitalism encourages crime. It creates a despe, 
rate need far food, and other life necessities, andeconomic advantage 
is equated wit h the pierson's intrisinic superiarity. Crime also results 
when there is a per,ceived opportunity ta gain an advantage thraugh 
illegal means, andjar when opportunities to achieve pleasure are clOS'ed. 
. off by a biased legal system. The mode of, productian based an private 


I R. Q u i n n e y, Class, state and crime. On the theory and practice of criminal 
3t&Btice, New York: David Me Kay Company 1,977, p. 126. 
6 W. A. B o n g e r, Criminatity and economic conditionB, Boston: Little, Brown 
and Co 1916. 
7 Ibid., p. XXVII.
>>>
112 


Sławomir Red,o 


property and individual profit, wit h its competition and itssubordinate 
c1asses struggling for the necessities of life, weakens "social feelings" 
and introduces egoistic tendencies. Jealousy and severility appeal' on the 
part of the dependent persans, the spirit of domination and oi insensi- 
bility to the ills of others tak1es floar of those with power. A moral cli- 
mate ofcapitalism is responsible for the criminality of both c1asses and 
"the criminal thought" has it's ground work to be realized. Finally, Bon- 
ger states: 


Upon the basis what has gone before, we have a right to say that the part 
played by economic conditions in criminality is preponderant, even decisive.B 


A similar approach, accorą.ing to Sue T. Reid,9 is presented by F. Tan- 
nenbaum. Thi,s American authol' potnted o\,1t that criminals are as lIl uch 
a pairt of the community as are scholars, inventors, .scientists and that 
community mustprovide a facilitating environment for their behavio,r 
to exist. 


The United States has as much crime as it generates [...j If we would change 
the amount of crime in the community, we must change the community. The 
criminal is not a symptom [...j he is a product [...J of the community.IO 


Although Sue T. Reid locatles the views of these two authors in the 
frames of the "facilitating approach", which is to be in contrast "with 
the deterministic approach of Marx",ll at least assumptions of W. A. Bon- 
ger, because of Marxist origins can not be put togethe,r with "socio-eco- 
logical" e}Cperiments of thie Chicago School of Sociológy, represented 
i1iter alia by F. Tannenbaum. 12 What is fol{' Sue T. Reid seen as an envi- 
ronmental (facilitating) factor of Bonger's work, arnd what would 1?e 
called some kind of flattening of his theory, js rega,rded, as a matt1er of 
fact, as only one element of a whole conception. 
A fulI picture of Bonger's theory is seen by the new criminologists, 
howtever, the hiel{'a;rchy ofpresentedelements 1S called into question. 
L Taylor, P. Walton, J. Young emphasize rathel' the role of "the c,riminal 
thought", which is to be for Bonger an independent fa'ctor for the ana- 
lysis and thus' is equivalenrt to the biologrilcal, psychologioal and sociolo- 


B Ibid., p. 669; Ch. H. Me G a p h y, Deviant behavior. Crime, conflict and in- 
terests groups, New York: Mac Millan Publishing Co 1976, p. 49-50. 
9 S. T, R e i d, Crime and criminology, Hinsdale-Illinois: The Dryden Press 
1976, p. 173. 
10 F. T a n n e n b a u m, Crime and the community, Boston: Ginn and Co 1938, 
p, 25, quoted after: S. T. R e i d, op, cit., p. 174, 
11 g, T. R e i d, op. cit., p. 173. 
II 1. T a y lor, P. Wal t o n, J, Yo u n g, op. cit., p, 223.
>>>
, 


The New CriminOlogy; the Problem of Etiology ot Crime 113 


gical factors accorded an independent and causativte status in the wri- 
tings of the positivist theorists of crime. 


It . is enormously parapoxical that a writer who lays claim to be . writing as 
, a sociologist and a Marxist shuold begin his analysis with an assumed individual 
quality (which he deplores) and proceed only later to the soC1al conditions and 
relationships sustaining and obstructing the acting-out of this quality.18 


For the new cdminologist Bonger's worlk is considered at least in its 
origins as Marxist ("...this social theory is not Marx'igt, Ol' at least it 
does not meet the fullrtequirements of a Marxist theory of deviance") 
Ci' fOI'mally MaTxist, since it appears as afrom of abstracted and eclec- 
tie positivism. It attempts ,to utilize some formal concepts of Marxism 
in .the uI1derstanding of the crime rates of European cSipitalism in thte 
late nineteenth and early twentieth centuries. Bonger's efforts l'epI'es'ent 
for 1. Taylor, P. Walton, J. Young notso much the application of the 
fu,lly-fledged Marxist theory, but rather an lextensionof the forma! 
concept of Marxism, in the area Temained largely untouchedby his 
ancestor. A serious author's concern over the determining role of t
 
economic factor is obS'erved, which cannot be found in the works of 
Marx,14 
Theauthors themselves see tbe role of the eoonomic pressures in 
much more complex way. The human action is treated as a reaction to 
the positions held in an antagonistic social strudure, but also as an. 
action tak en. to resolve those antagonisms. 


It would, in brie!, involve a model-suggested but not folIowed throughly by 
Marx himself - ot the dialectic of human action..., (and turther they add:] The 
widerorigins ot the deviant. act could only be understood, we would argue, in 
terms of the rapidly changing economic and political contingencies ot advanced 
industrial society.U 


ThevieWiS o,f the British new ClI'itmitnJOLogists, seem to differ COiDISMe- 
rably from the assumptions of the. radical Americancriminologist 
R. QuinD!ey. In his opinion expressed in a rece,ntly published book Crime, 
class and society he recognizes a strong determinant role of theeconomic 
system as the cause of criminality. For thisauthor all social1ife in capi- 
ta1ist society, includmg Jevery,thing associated with crime 


...must be understood in terrns ot the economic coriditions. In other words, in 
capitalist society the life and behavior ot any group in the society, or any indi- 
vidual group member, can be understood only in terms ot the conflict that charac- 


18 Ibid. 
14. Ibid. 
15 Ibid., p.236, 2.70.
>>>
, 


114 


Sławomir Redo 


terizes class relations, which in tum is produced by the capitalistsystem oi pro- 
duction. 18 


Contempormy socialist criminology has departed f.rom a rigid treat- 
ment of the economic faetor as decisive cause of crimin'ality, constdering 
that neither Marxnor the other classics, were of that opinion. This se- 
cond approach to the function of the IeOOnomic system. as a c
iminogenic 
factoil' simultanouslyappeared with the formulation of the "relic" theory 
which importance should be presented firgt. 
If we consider the evolution of views of the socialigt criminology on 
tbe etiology of crime, we should firgt note a sta1'tingpeTiod of its de- 
velopment, which todkplace in the Soviet Russia,soon after the October 
Rev91ution. In those thnes a st!rict interrpretation of the classical Marxist 
W9 rks ,prevailed, according to which the change of the socio..leconomic 
system resultsilIl cuttilng of the stlructJUJral c:auses of clrimilIlal behavior. 
The 1'oots of existed criminali ty . were searched then in the bio-psychical 
construction of th1e individual. In the 1930's another conception was 
wtdelyin
oduced, the relic theory. This faet "was linked witha general 
throwbaok of the Soviet criminology",17 According to its starting ver- 
sion,18 the existence of criminality in the sodalist countries is due' to the 
functioning in tbeperson's conciousness the survivals of theformer cri- 
minogenic structure.Generally 
peaking, such. existing acts have been 
coI1lsiderred as the rel!iJcs (l,at. residua) aiS, for ilIlis'bance taking of the 
commission for the deliv1ered rp.roduct Ol' the speculation of theforeign 
currency. Both of them were accepted Ol' even formerly indespensible, 
but now a,re prohibited in new social arrangements. 
While for somie of the authors the relic theory still holds its strong 
explanatory power, for the majority orf others it is no longer exclusive. 
Actually a complex approach prevails, according to which it is necessary 
to carry criminological investigations over the etiology of' the pheno- 
menon in many ways, incIuding, its h is t o l' i c a l conditioning. 19 This 
conception will be presented later on. 
As we can see fromabove opinions, a contemporary sodalist Vision 
of the economic pressures follows neither the deterministic approach 
presented over half a century ago by W. A. Bonger, nor that oiR Qin- 
ney. BOInger's oonception, though based on Marrx' WO
kLS, was finally re- 


18 R. Q u i n n e y, op. cit., p. 36-37. 
17 B. H o ł y s t, Kryminologia. Podstawowe zagadnienia, Warszawa 1977, p. 220. 
18 Ibid., L. L. L e r n e 11, Zarys kryminologii ogólnej, Warszawa 1978, p. 229- 
236. 
19 V. Z v i r b u l, A. S c h l i a p o c h n i k o v, O sostoianii i perspektivach. razvi- 
tia sovietskoi kriminologii, Socialisticheskaia Zakonnost, 8/1976, p. 36.
>>>
The New Criminology: the Problem of Etiology of Crime 115 


cognized as ecledic and oversimplified. 20 Howeve(t', it does not mean that 
one ought to accept the British new criminologists approach though 
their view concering thedialectics of hwman action is anaIogic to the 
vi'ews presented ,by the sodalist criminology.21 At lea:st their final sta- 
tement referring to the changes in advanced industrial society without 
further explanation sounds ambigous. Similarly, the opinion of Sue 
T. Reid on the "deterministic aJPproach of Marx" shouId be rejłected, as 
well as this of G. B. Vold suggesting "inverse" or "negative" relationships 
between eoonomic coOOitions and the crime rate in Marxist thteory.21 
Since the last two authors are no(t' considered to be Marxists, the exa- 
mination of their conception is located beyond th'e scope of this article. 
The role of the economic factor is complex. !ts onesided XIXth cen- 
tiu!l'y ilnterprteta1ioo in the term od: the CIl1fumnQgenic exploitation aiIld 
poverty dO'es not help to explain the etiology of contempoi'ary "white" 
and "blue" collar criminality. It doesnot mean, however, that the cri- 
minogenic role gf poverty is denied utterly: certainly; some property 
crimes may be committed to acquiJ'ie money for living, but many 
more result from practically felt differendes in the standards of living 
among people. When the individual finds himself relatively POCI' or 
"worse", because another person is richer Ol' "better" than he, he may 
experience the situation of inequality. The individual may try to neutra- 
lize this state committing a crime. 23 As Marx stregSed, a smalI house 
satisfies the social requirements of its roommates only as long as there is 
not a larger one close by.24 
This instructive view entiHes us to say that R. Quinn1eys "political" 
interpretation of those behaviors as a result of the class domination is 
insufficient and simplistic. Accepting exclusive role of the socio-econo- 
mic structure in the criminogenesis, weare unable to investigate the 
causes of intra-class ,criminal behaviors. Violence among working popu- 
lation, property crimes among those with power need more explanation 
than it is done in the terms of the decisiv'e róle of the socio-economic 
system. Some crimes areconsidered by the radical theorists as a form of 


20 B. H o ł y s t, op. cit., p. 219. 
21 L. L. Lernell, op. cit., p. 178; E. B Ilcholz, J. Lekschas, R. Hart- 
m a n, Sozialistische Kriminologie. Ihre theoretische und metodologische Grundle- 
gung, Berlin 1971, Staatsverłag der Deutschen Demokratischen Republink; p. 115- 
119 [translated into English, Lexington Books, 1974]. 
iZ G. B. V o l d, Theoretical Criminology, New York: University Press 1958, 
p. 174. 
28 L. L. L e r n e 11, op. cit., p. 236-'-251. 
24 K. M a r x, Praca najemna i kapitał, [in:] K. M a r x, F., E n g e l s, Dzieła 
wybrane, War!1zawa 1949, p. 87.
>>>
:116 


Sławomir Redo 


pre-consdausness political activity. This hypathesis is very inteI'lesting, 
but its accuracy is probably impossible ta prave. 
"Political" interpretatian is particuiary h
d to accept, when the 
ettiology of paJSsicmed homicides, sexuail offenses, bigamies or-la'st bl1.t not 
least-several international crimes would have been cansidered.' As L. Ler- 
neU convincinglypoints out oontemporary crhninality in the capitalist 
ooutries need a deeper interpretation on the background of different 
sodal, cultural and civilization processes.2
 
Attempting to e
lain the letiology of crime in thesadalist cau):'ltries, 
the students shau1d remember that Marx' opinian holdsalsa its impOf:" 
tance in respect ta new :5Ocial arrangements. Despite their introductian, 
the differencles in the standards afliving, though not 50 considarableas 
in the capitalist states, still exist. The situatian af inequality causedinter 
'alia by these differences - L. Lernell argues 
 may play its crimi- 

agenic rolle as long as the standards of living will nat!becomelevelled. 
.. Hawever, a fuU equiliization is hard to achieve. 28 
, The limitation of the socio-ecanomic priviledges daes not gtlarantee 
the elimination of a whole criminality phenomenon.Thłe conclusiQns 
drawn in the course af the suppressil()n. af criminalIty. in.. socialist states 
lead the criJmiInKlogiJststo the belief, that though the ecollOmic faotor 1S 
yery irnportant, more sources of crimlnal behaviar can befaund. Having 
ręeognized that its function "still remains a drastic problem af criminal 
etia1ogy'',2'l the stude"nts turned their attention to several other factors. 
, "A cansiderable value among them is attached to thle role of the affender's 
personality. 


THE ROLE OF PERSONALITY 


The Marxist paradigm in this respect isdifferent1y interpretetedby 
the.new and the sacialistcriminolagists. The radical tbearists' under- 
".stanc.iing of therole of the. individual. in the criminogenesisseems unclear. 
At least one may come to such a canclusion after taking cognizance of 
R. Quinney's views. In his earlier book The social re ality oj crime we 
may observe anly the authar's separation of man, as the ,,,individual" 
involved in a subjectiV'e sodal world, and pursuinga set af highly 
segmentary interests and sooi1ety an amaLgam of IUlnequal insti tutianal 
9rders falling under thesway o
, the domi
antview af soęial re alit y, 


!5 L. L. L e r n e 11, op. cit., p. 180. 
I' Ibid., p. 18i " , 
27 Ibid.
>>>
The New Criminology: ,the Problem. of Etiology of Crime 117 


Le. the government's.28 Is his latE
r book Criminology we meęt thę 
author's definition of the sO$::ial re ality of crime. "The social rteality of 
crime i5 oonstructed by the formulation andapplication of gefinitions 
of orime, the development of behavioł" pat1tell'IlS [my 
emphaJSis] in rełatdan to these defriJnJirtions, and theoonstlruction of a\n 
ideology of crime".29 InR. Quinnley's lasi book, as it was cited above, 
the role of the ind.ividual in the etiology of crime was exclusively seen 
via the socio-economic strudure. 
The British new CTiminologists c:riticize such' an interp
tation of the 
social Ireality of cll'ime, irOlIlically startilrlg that it ;is an :iJn1Je;raction bet- 
ween 'bits of society and "sorne Robinson-Crusoe like individual''.ao The 
authors themselves are of the opinio:n that there would exist the inf1uen-' 
ce ofautomatic responses in humaIl behavior in the context of human 
cr'eativity,while later on it i8 suggested, that "an adequatly s o c ia ł 
theory wolUłd need to b e fil' e e [my italiClS] of the biological and psycho- 
logical assumptions".31 
. Weshould \not be satdsfied witih these ans,wers, silnJCe R. QuiJnaley's. 
approach in concert with the orten stressed dialectics of human' action, 
of Marx, seems to b1e oriesided and unclear. Neither should the British 
new criminologists views beaccepted, though they shm-e Marx' opinion. 
As has been shown their assumptions have been contradictory and there- 
fore-ambigous. 
If we took a whoile radicalliterature, one may say that besides sonie 
"routine" statements like this O!f Sherman: "In criminology we niight 
ask how crime evolved... ",32 there is not any thOTough effort to develop 
fully this issue. One may come to the conclusion that for the radical' 
theorists the issue of the offender's personality does not exist. It might 
seem strang1e to imag[ne that S'Uch a maJte!I'liJaiist pwadigm so concemed 
with thle explanationof the totality of situation, wouM neglect to ana- 
lyze the possibility that some crime may be related to the personality 
features of the individual and that some of these features may be of the 
pathological character. 
It is l:hktely, that no one solution in thią field ref1ects socialist'scri- 
minology standpoint, at least fram the earlier stage of its development. 


28 R. Q u i n n e y, The social reality oj crime, Boston: Littlej Brown and Co 
1970, p. 38. 
29 I d e m, Criminology. Analysis and I
ritique oj crime in America, Boston-To- 
ronto: Little, Brown and Co 1973, p. 40. 
. 80 I. T a y lor, P. Wa 1 t o n, J. Y o u n g, op. cit., p. 260. 
81 Ibid., p. 65, 268. 
32. H. S h e r m a n, Dialectics as ci method,TheInsurgent Sociologist,6/1976, 
p. 62-63.
>>>
118 


Sławomir Redo 


For the time being, some kind of revitahzatian of the discussion over 
the role of the persona lity factor has taken place generating 'sevteral 
publications from the end of 1960's. 
At least three approaches might be faund aut. The fir5t ane is belie- 
ved to be b i a l a Ig i c a l. Accarding to the Soviet author L Noj ttie 
negative and positive maral features "are comprised in the immate pro- 
grams af theman's conduct, which have been coded on the Ilevel af the 
SOCIi'al instinots".33 This arsIsumptianx was met with a serious C!l'itique. It 
was stressed that regardless of any reservations made by the authar, he 
reduces the facts being social ta t
e bialagical anes. It is impas.sible to 
ciem.- up the Icriminality as a m a s s P h e n a m e n a n only in the terms 
af the genetic inclinations of certai'ń individuals. 34 
'This critique was faund as onesided. Other specialists pointed aut 
that in th'e present state ofknowledge we cannot. deny that the gena- 
types play a 
ole in creating af huroan behavior, however 'they are 
probably nat the basis far programing. It is rathel' believed, that "eve- 
rything depends on the jaint action af the genotype and the environ- 
ment".35 Since this approach is new in socialist criminalogy, it has not 
gained wider popularity yet. 
Contrary ta that first attitude, the secand s o c i a l interpretation 
seems to be more popular. However, it is not 50 canvincing. The 50cial 
approach is strongly 'emphasized far instance in W. P. Szupilav's and 
N. J. Kuznietsava's conception submitt'ed in thek publicatian on critique 
of the b a u r g e o i s e, biological theories. According to them, the re- 
suit s ai the investigations carried, are based on unrepresentative /popu- 
lations and mainly fo.r this reason they can not be af help in explaining 
the high crime rate in the W e s t e l' n hemispheł'e and the totality af 
this sophisticated phenomenon. The authors themselves are of the opi- 
nion, that thecauses of criminality should be interpreted anly in the 
terms of the darnina nt Ol' even exclusive role af the socia-economic 
system. 38 This rigorous tnteą»'etation daes not fit the situation in the 
50cialist countries, where despite a new structure, crimina1ity still exists 
and obviausly is nat directed to make it. The folIowers of this canception 
seem to. explain its subsista'nce in new canditio.ns chiefly by the mean 


38 I. N o j, Metodologitcheskje problemy sovietskoi kriminologii, Saratov, Izda- 
telstvo Saratovskovo Universiteta 1975, p. 90, 106, 140. 
84 V. Zvirbul, A. Schliapochnikov, op. cit., p.36. 
81 L; L e r n e 11, op. 'cit., p. 166. 
88 V. P. S c h u p i l o v, Niesostoiatelnost biologitcheskich teorii priestupnosti 
w burzuaznoi kriminologii, Sovietskoie Gosudarstvo i Pravo, 10/1977, p. 102-106; 
V. J. K u z n e t s o v a, Wsp6lczesn
 kryminologia burżuazyjna (trans!.), Warszawa 
1976, p. 35, 68-70. 


ł'
>>>
The New Criminology: the ptoblem of Etiology of Crime 119,: 


of the relict theory, which d'espite its modifications is p1'obably still. 
unable to e
plain tp.e totality of criminality phenomenon in the socialist 
countries. 37 
The most convindng theory, seeI;nS to be the third one, 50 caUed 
complex-sy,st'ematic. In the scope of 50 named conception one 
would find several othe1's, which fit it generally, but differ 50metimes 
in details. This approach has been tightly correlated with the conception 
of the relatively determinant funcHon of the socio-eoonomic system that 
was pr
sented befo1'e. 
According to its follo:Wel"s, the biological Ol' sociological interpretation 
. 
of the 1'oots o.f the criminality is too harrow and onesided. 38 A mOTe 
sophisticated approach is required which ta:kes aocount of more elements. 
, Crim1nality is conditioned socially and historically. It has its tendendes 
in functioning in different socio-economic systems,., it is characterized by. 
a certain regularity up to their catego.ries and socio--demographic features 
of their ,perpetrators, environment (faroily, peergroup etc.) and, finally 
up to the !,mechanisms of the socio-psychological criminal conduct".39 
1£ we take into account the etiology of crime as it is seen by the GDR 
criminologists, among several others, apersonality factor is recognized. 
"The individual features ,of the man have played -[...] its substantial 
role..." in committing of the sexual offences. 40 Hungarian criminologists 
M., Vermes gdeS further and said that apersonality factor should be 
exibited in fuH scale, otherwise one may miss an organie crime's ingri- 
dient, what may finaHy lead to the partial explanation ol thę committed 
offense. 41 In Polish criminology similar view has been presented 
W. Swida, though he does not support strongly the role of the patholo- 
gical factor as a cause of committed offenses. 42 
More detailed opinion in this respect was given recent1y by L. Lernell. 
According to him, it is inadrnissible to deny in the criminogenesis the 
role of biological (especially of pathological character) factors. However, 
we should 'not ov'erestimate their influence, since every criminal behavior 
takes place in interrpersonal, social scheme. For this reason one need to 


87 N. J. K u z. n e t s o v a, op. cit., p. 35, 37; W. S w i d a (ed.), KTyminologia, 
Warszawa 1977, p. 165--167. 
88 B. D. 'O v t c h i n n i k o v, Czynnik społeczny i biologiczny w etiologii pTze- 
stępczości (trans!.), [in:] Kryminologia w krajach 8ocjalisty,::znych, Warszawa 1976, 
p. 61-62. 
8. V. Z v i r b u l, A. S c h l i a p o c h n i k o v, op. cit., p. 36. 
10 E. Bucholz, J. Lekschas, R. Hartman, op. cit., p. .116. 
11 M. V e r m e s, Osnovnyie pToblemy kriminologii (transl.), Moskva: Progress 
1978, p. 116 (English trans!. publ. by Sijthoff-Leyden, Akademiai Kiad6 - Buda- 
pest 1978). 
II W. S w i d a, op. cit., p. 166-168.
>>>
lfo 


sławoinir Redo 


search for the deterrninants of criminality in the "configuration of hu
 . 
man.lI'el
tions".43 SimiIall" vd,elWs has bem presented by M. Vermes, who 
sees the formulatien Qf anthropelegical and physielogical factors ef the 
behavier in the envirenmental centext. Since chromosamal and other 
theories - he argues - have net been c1o'sely ,exarnined and there are 
no. sufficient evidences of their accuracy, the folIewers ef such concep- 
tiens should recognize that sodal facters play substantial role, even 
móte: thtese factors may neutrlize the rele ef rbielogical deviance in the 
process of shaping the personality.44 This attitude is also represented 
by J. Bafia, who. concludes thatdifferentiatien on bielogical and secie- 
leg
cal approaches to the criminege'nesis is methodologically false, since 
in reality we oonsider the connexiens and relations between criminalś' 
(individuals) and criminality as a 50dal phenomenon. .N'either the indi- 
vidual nar the ebjective re ality, especially 50cial is able to exist witheut 
each other. 411 
As we can see, this third approach to the letielogy of crime, where - 
inter alia - the' role of the offlender's persOI:nłsHty 1S s1Jrongly eą:nphasi:z6d;' 
differs slightly from that presented by the radical theorists.Attłention 
turned by the secialist criminologists te the personality features of the 
, ilndividual has been probably the result of unsuccesfullattempts of intłer- 
preting the criminogenesis in the terms of onedimensional materialist 
philosophy. Mere advanced studies ef the Marx:ist paradigm allowed to 
find, that t
 classics recegnize the individuality of man. Marx "homo. 
socius" should be understood in the terrns ef interdependence of the' 
individual and the social factors both contritbuting to man's behavioi-. As 
it was pointedby MaIl'X in his Ecenomic and Philosophical Manuscripts 
man is a species being and his distinguishing features make him s indi- 
vidual and real ind i v i d u a l i s t i c social hurnanbeing. 48 If we get 
baok to the dialectic of the human action ("just as society 'prociuces main, .. 
sa is society produced by him") , we sheulddraw aconc1usion, that nei- 
ther Marx nor Lenin ignored the personality feattlres of man, including 
his physiological auto1.'1omity (character, temperament, and 50 on). Te be 
far from vulgar-sociologic interpretation, one should understand Lenin's 
opinion, that "thle sociologist-materialist studying man's history, simul- 
tanowsly deea 50 to his personality" ,47 as recognition of the individuality 
.1 L. L e r n e 11, op. cit., p. 167. 
44 M. V e r m e s, op. cit., p. 141. 
45 J. B a:f i a, Problemy kryminologii (dialektyka sytuacji kryminogennej), War- 
szawa 1978, p. 29; see also S. R e d o, review of the book of A. A. G e r t s e n z o n, 
Ugolo'tJnoie prawo i sociologia, Moskva 1970, [in:] Panstwo i Prawo, 12/1973, p. 145. 
.8 K. M a r x, Rękopisy ekonomiczno-filozoficzne, [in:]. K. M a r x, F. E n g e 1 s, 
Dzieła, vol. 1, Warszawa 1960, p. 580. 
47 W. L e n i n, Dzieła, vol. l, WarsZI1wa 1950, p. 439.
>>>
The New Criminology: the Pró1:/iem of Etiology of Crime lit'. 


of the human being: individuality which is also shaped by the biologic
r 
endowment. ' 
Having stressed the role of the personality f8ctor in criminal behavior 
in sodalist criminology one may come to thle condusion that the weakest 
point in the new criminologists' conception of the criminogenesis seems 
to be the individual. For tbis rearson it is worth to notice, that for Marx 
the theory is .able to attempt the massies, when it becomes radical. Tó be 
radical, however, it means to hit the nml on the head. But the head of 
the nail for 8 man is man himself. ł8 
It seems \ that a complex,multilevtel etiological theory should take 
accoU'nt of two discussed b a s i c factors influendng criminal behavior, 
Le. the socio-economic and the personality ones. The soeio-eoonorhic' 
structure and the individual are dialectically intlerdependent of eaeh 
otheI'. The same kind of re1ation occurs simultanously between the indi- 
vidual and his environment, Le. living and working conditions,peer 
groups, school and so forth. The environmlent a1s0 shapes and is shaped 
by the strueture, This type of mutal dialectieal intm-dependence between 
the. individual, his 
nvironment and the socio-economic'system ćreates ' 
certain behavior patterns.These patterns on the level of envirortfnent 
might be in different ways disseminated among other people and in 
various ways accepted depending on the persOnality of man considered 
once again as a product of dialeetieal inverdependenee of tneritioIied ele- 
ments. To explain mafi's criminal behavior one may use several theories: 
psychologieal, physiological and socio-cultural ones. Someof thtem inte- 
resingly show the modes of "transmission" of the criminal behavior, to 
poiJnt out only Sutherland's differential association theory. Certainly, 
they might be of help in making 
ear the "socio..,psyehological" part of 
the individual's eonduct. It is likely that several eonceptions would serve 
in explaining the same complicated case. None of these theories plays 
a monopolistic role in explaining the criminogenesis. 
This general 
mark does not pretend to be concerned as a fulI seale 
vision of the roots of criminality. For this - further 
xploration is 
required. 


FINAL REMARKS 


The radical theory of crime is in its first explanatory stage of de- 
velopment. As a matter of fact thisnew criminology is not new, since 
it intlends to solve the problems of the etiology of crime according to 


48 K. M a r x, Przyczynek do krytyki heglowskiej filozofii prawa. Wstęp, [in:] 
K. M a r x, F. E n g e l s, Dzieła, vol. l, Warszawa 1960, p. 466.
>>>
122 


Sławomir Redo 


the "old" classics' theories. The only "new" thing in it would be their 
interpretation. As we intended to show, in many situations the radical 
theorists misunterstand the conceptions of Marx and Engels. Might be 
that one of the causes of this misunderstanding is the dearth of literature 
available from the socialists oountries, u tiHzed in their books. Only a feW 
(rarelyfrom the field of criminology) have been inc1uded in conside- 
rations. 
One should not be too harsh on the works of the radical theorists, 
sinoe much of the literature does raise some very important issues. The 
Marxist ćriminology is at its outset. The bases of the paradigm are now 
under discussion. Sometimes it is characterized as lacking precision, 
consistency, sophistication Ol' comprehensibility and even ascavalier 
treating some iundam'ental issues. Some of these faults oould have been 
avoided if more thannow attention 'Would have been paid to the expe- 
riences oi socialist criminology, where the Marxist paradigm a long time 
ago left its first stage of d'evelopment. 
The purpose of this artic1e was to present and discuss several issues 
concerning the problem of . the etiology of crime as seen fromthe nlew 
criminologists and sodalist criminology point of view. Unfortunetely, it 
has been impossible to oomment thema11 and at the same tim'e compre- 
hensively. Simultanously it might be that the authol' was not free of 
oversimplification- this darnger is associated with the modest size of 
this publication. Many issu'esobviously need more explanation than has 
been done here.The growing interest ofEuropean sodalist criminology 
i,n the radical theories of crime encourages fu'rther considerations in the 
future.
>>>
ACTA U N I V E R S I T A T I S N tC OLA I C O P E R NIC I 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 1978 


Department oj Constitu,tional Law 


Waclaw Szyszkowski 


SOME ASPECTS OF THE DYNAMICS OF TI-lE INCREASING 
RESPONSIVENESS OF THE US GOVERNMENTTO THENEEDS 
OF THE PUBLIC 


c o n t e n t: Author argues that there alwilys has been a high degree of inter- 
dependence between the government and e the business community; that this nor- 
mally took place to advance the interes ts of the power holders, and that whenever 
attempts have been mad e to mak e the government responsive to the needs and the 
wishes of the public, the laissez faire protagonists would advocate government'g 
"hands off" policy. 
Two areas of concern were mor e thoroughly analyzed: social security and me- 
dical insurance universal coverage. The argument is advanced that nO modern, 
complex society, such as the USA, may much longer resist enactment ofprograms 
long ovetdue, such as a universal medical coverage. 


GENERAL OBSERVATIONS 


In an atternpt to understand the dynamics of modern society, the 
pre-scientific tradition continues to structure the difScussion in terms of 
what concernsshould domi!nate the scene of social policies - those 
favoring the individual or the state. With the OIlS'et of a variety of system 
analyses, the more efficac10us question emerges: What iiS the nature of 
inter-institutional interpenetration, Le. interdependence, and what eon.. 
sequences inhere for an individual (and for society) as concomitant with, 
or contingent upon, these extant interinstitutional configurations. 1 


1 Cf. the contribution to understanding natureof the above mentioned arange- 
ment, by A. J. P u c h a l a (Ohio University), Modern Sociology: Concepts, Expla- 
nations, and Modes of Analysis, unpublished manuscript:"Systemic model ot social 
systems (primary and secondary organizations, associations, institutions, political 
and ecological entities, and other institutionalized systems of action) makes use of 
at least the following conceptual hardware. 1. Unit ot Social Action. 2. Types ot 
Social Aćtion. 3. Membership. 4. Functions and dystunctions. 5. Type ot authority. 
6. Dominant ideology. 7. Sanctions. 8. Resources. 9. Environment. 10. Historiea}
>>>
124 ' 


Wacław Szyśzkowski 


In a modern society - society measuring high on thle scale of secu- 
larization, specialization, eentralization, industrialization, bureaucrati- 
zation, and urbanization - the most strategie institutions appeal' to be 
those of economy, mi1itary, po lity, and academy (read, for instance, 
C. Wright Mills Ol' the farewell speech of Eisenhower regarding the 
"industrial-military complex"). 
The 'purpose of this discussion is to explore Some of the more salient 
aspects of such interpenetrations. For the purpose of parsimony, the 
study will be limited to only two such strategie institutions: the ec0!l0my 
and the polity. The case study is that of the United States of America. 
The USeons.titues a unique cas
.Iinbęrtain sefise basic societal design 
was' moldedafterthe d$derata orf the' Hbertarian. democta.tic thought. 
Uin1ike Europe, at the time of Us em)eTgence aiS anindependent state, 
the US was free of the institutionalizled feudalistie ballast. The new 
societal design embodied a diversity of ideological thE!mes. It encom- 
passed, then quite revolutionary, liberal philosophy ofA.dam Smith; 
libertarian-democratic thought of Thomas Jefferson; Hami!ton's distrust 
of the public and the masses, andthe Puritan Ethic .-'- Calvinistic ver- 
sion - of wark, saving, "getting rich and getting ahead". In addition, 
it wisted - after the blue,print of Montesquieu - upon diffusion of 
societal functions among highly speeialLzed, and rigorously contained 
within th'eir own boundaries, 'numerous institutiO'ns. This' latter found 
expression in the rule of non-interference between the. government and 
the church, government and the business, and :businless and the mi1itary. 
A historkal aocount oI this debate and a.n attempt at assessing real 
life conditions and occurences will shed light on the issue at hand. 
'Needless to ąąy, Amle-rican society is groun:ded in British tradition. 
But in certainrespects it ref1ects not only acontinuation fo that tra- 
dition, but a reaction to it. 2 Henry' Steele Commager,l'lotes that English 
econmy; in the 16th and 17th centuries was v1ery closęly by the state. 
He writes: "The principie that the state should -regulate wages, prices" 
services,and other aspeds.of economYi was inh1erited by the Puritans 
Bind re-inforced 'by the teaching oi re1igion
'.3 Ofcourse, during the colo- 
nial period, attempts were made to'structuresociallife in colonites after 
the English pattem. The impact of this philosophy is, examplified in 
a caS'e described by John Winthrop of a wealthy Bostonian, Robert 


sketch. 11. Wealth. 12,. Pressures. 13. Benefits. 14, Researcher. 15. How was the .re- 
search model operationalized and why. 16. General. 17. Areas untapped. 18. Impli- 
cations of the findings. 19. Directions and directives for future research".. 
I. V. L. P a r r i n g t o n, Main Currentsin American Thought, vol. 1, New York 
19!i8" p; '293. 
.3 Li;v?'ng Jgeas in.,America,ed.H. S. Co m m,ag er,New Yo
k 1964, p, 318.
>>>
Some Selected A
pectsof the Dynamics... 


125 


Keaine,whoown1ed astore and. merchandized in foreign commodities. 4 
Ąccused of charging. excessiveprices, Keaine was fined by thecourt one 
hundred pounds. 
It was Thomas, Jefferson, who in his first inaugural address, sta1!ed: 


A . Wis e and fru gal 'govetnment which shall restrainmen from injuring one 
another,shall leave them otherwise freeto' regulatetheirowrr pursuits of industry 
andimprovement, and shallnot take frol11 the mouth or labor thebread it has 
,eaJ!ned. 


Even thoughJeff
rson's statements in the socio-politicalcontext of 
two, hundred .. ytearsago, had ,diffen
nt . meanin
 . from what. they would 
';imp:utetoday, it unque$ti01nablychaUenge:dth

ritish tradition. ....., 
In. nineteenth century, this' newphilosophy',came to' practically do- 
minatesocial scene."It isc1early seen inthe area oLpolitics, jUrispru- 
dence,economics,and philosophy. .. .... ... ..... .' '. .,' '. 
President Van Bu ren , in hismessage to Congressin1837, reiter
ted 
'go:vernm

t's "handsoff" policy;
rguing that "alI ąommunities are apt 
. to'lookthe government't'or too much". FO!1:ty ye,afi'lS la:ter, the Supreme 
Court ofthe US in. Munnv. IIlitlois, 94 US 113(1877) has recogni- 
zed acategory of "business aUected witna publk interest". Herbert 
Spencer and William Graham . Sum hel' ., '. accepted theoretiCal uh,derpin- 
nings - known associal Darvinism - of the laissezfaiI"e s
iety. The 
l
sse
 . . faire liberals, also. referred to as .classic ..liberals, fóund 'Strong 
"stipportamong propertiedelitesand,amongothers,in the Supreme 
"Court.ThisespeCially w.asevident duri/ng the period between 1880 and 
19M
 . . ',' ' . 
It i(Sgerrerally a
ceptedthatthe ni.:neteenth century America isaso- 
ciety ofconstant gl'owtn andexpanstoh. The Westward drift servedas 
'a safety valve;'and iła ,titoublesmoldered in, the coal pitsofOhio, Penn- 

lva
ia,and . Illinois, for example, squ'adsof
O?Jls, pri
ately owned 
practically private' 'a:rmies; would.' t1errorize )he \vorkers. Laws that were 
enactedtocurb
d to .control..
usiness and .industry Were normaUy 
a:dvanc
d 'fromthestandpóint ofrendefing some .senseand 
rder'to these 
""r,eas, not to
protect. the public .and thie masses.The public wa.sfuld: 
!,caveat eirlptor".', . ' .. . i . . , "'. 
Perhapsit shóuld also be pointed out that
tthe.time whenthe main 
tenets. of the capi talistic society were beirig fortnulatted and at tłie . same 
titne. the fo,utidation.s ,wereh.eińg . set f()r theAmetican sodety, 94°/0 ol 
'Amei'icahsworked in farming;'orily'3 8 /6htidcollege education; most 


4 J. W i n t h r o p, The Bistory of New England from 1603 to 1649, '\'01. 1, 
. .Boston "1'853, 'p. 31a.:-311;: 
5 H, S,C o m m a g e r, op. cit., p, 380
38], .. "
>>>
126 


Wacław Szyszko wsk i 


Americans were of the English-Scottish ethnic ,background, a;nd none 
of the Founding Fathers knew of the forthcoming of technological so- 
ciety. 
It was not until the turn of the cen tury that the Wlest coast was 
reached; that John Pierpont Morgan. in 1900 parted with the laissez faire 
small scale entrepreneurial men ta lity and founded an industrial giant, 
the Unitted States Steel Corporation, the harbinger of things to come, 
e.g. multibillion doUar corporations; unprecedented explosion in sciences 
and enginęering, and finally the emergence of the totally new world 
political configurations that it will take two world wars to accompHsh. 
It is in this context that the role of the government - as a tool of the 
public - is, for the fir8t Ume, honest1y addressed. 
Cutting through the rbetoric and reified ideological assumptions, 
when we 19E!t to the core of the matter, the nascent issue is not that 
whether the government should become active in the econo
ic field, 
for the government a l w a y s played a preponderant function in 
structuring sodal life - rometimes as a tool of economic power holders, 
sometimes as an initiator of grand-scale domestic and foreign operatioos. 
For exampl\e such was the case with investing billions of dollars in 
research and education initiated with the Grant Land College program 
in 1860s orby making the South America practically its own backyard 
by me ans of Monroe Doctrine. 
Those capable of transcending narrowly defined group intertest advo- 
cate more active role on the part of the government. dubbing laissez faire 
as "unsafe in ,politics and unsound in morais". Justice Olivel' Wtendell 
Holmes of the Supreme Court declared himself as a representative of 
majority and became a persuasive s.pokesman for "inVerventionist" policy. 
He became known as a "great dissenter " , whose dissents were subse- 
quently accepted by thte court of law. 
President WHson (New Freedom, 1913) argued for the "freedom from 
controi by powerful organizations that threatened both the liberties of 
m'en and the authority of govemment".1 Thorstein Veblen, economist 
and sociologist, beliteved in the public controi over modern economy.'1 
President Hoover, however in his well known veto of the Muscle Shoals 
Bill (1933), firmly opposed - what he called - govternment's "com- 
petition with the United States citizens". 
Normally, the outery that the government mterfere too much, is 
heard not when the .govemmtent is advancing measures of the interest 


· Ibid., p. 347. 
1 D. R i e s m a n, ThoTstein Veblen. A cTiticcll lnteTP'fetation,New York 1960, 
p. VII, 77, 
6, 108, 116.
>>>
Some Selected Aspectsof the Dynamics... 


127 


to the power holders, but it takes place when the government is asked 
to respond to the needs of the public - be it national insurance; social 
security; racial, ethnic, sex, and political discrimination of minority 
groups in general; mo'reequitable distribution of nation's wealth, e.g. 
progressive taxation, inheritance taxtes, consumer proteetive legislation, I 
and guaranteed annual minimum iucome, and affirmativesocial projects 
aimed at upgrading the downtrodden. 
Another area a1together is making use of the government by power 
groups and power e1it'es in seeuri'ng s e l e c i t v e enforcement of some 
1aws in. respeet to some social groUps, on the one hand, and "exerciseof 
permissiveness", in respect to favored groups, on the other hand. For' 
e
amp1'e, even as late 1930s there were in the US at least 230, industry 
owned, "private detective agencies", whose sole function was - according 
to Congressiona1 Dietz Cotnmlittee 
 spying on, and harassment of, labor 
union leaders; beating up striking wOl'kers and breaking up of pickets, 
and in genera1serving business and industry. There were a180 charges 
of homicide. 
Whatever one's position on, and the attitude toward, the use of go- 
vernment in resolving sQcial issues and attooding social needs, the 
government has been, a11 along, extensively used in a wide spectrumof 
areas. This was normalIy done not only without much fanfare,but fre- 
quentły withiln the oontext ofO'Ut!I'right. der1lials. For exampl1e, when due 
to rampant inf1ation, in 1971, then the president Nixon, while announ- 
cing his irhposition of price control 
 as a measure of countervailing 
the inflation - he spoke most1y on the subject of the merits ofunim- 
peded private enterprise and the ben'efits inherent in the spil'it ot com- 
petition and individualism. 
The US governmant has played a part in at least the fo11owing: 
_ Organizing,direeting, andfinandng applied and theoretical rese-' 
arch - especia11y in engineering, agriculture, mining, and more recent1y 
in human motivationa1 manipulation and management. 
_ Centralized planning and management of industrial production by 
favoring some industries and social groups by rneans of a11owances, 
taxation, low interest loans, direct subsidies, providing access - politi- 
ca11y, militarily, and economica11y - to l'aw materia! abroad and to 
unloading foreign markets. 
- Extensive support given to multi-national corporations. 
_ AdmiJnistration of social weUare, e.g. ADC (Aid to Dependent 
Children) subsequent1y renamed Aiid to Families with Dependent f 
Chi1dren (AFDC); A.FDC-UP (Aid to Families with Dependent Children 
andUnemployed Pa!rents), Socia:1 SecUTity, Medicatt'e and Medicaid. 
_ Contervailin1g undesiJrable economic trends, e.lg. holding down on
>>>
128 


, Wacław Szyszkowski 


inf1ation, pręventing recession, avoiding depression, holding down eco- 
nornic resurgende, overseeing insur.ance of saving deposits (up to 
$40 000). 
-- Carrying our economical and fiscal programs in support of the 
dollar an meansof international currency. 
- Maintaining - practically keeping 1n power - ultraconservative 
governments in a number of countries visiblyaga
nst the willo! the 
ruled. 
:--.. Conducting ethnic and racial policies, clearly favoring the Nwd.ic 
_,gr?ups and iiscriminating against Eastern Europeans, Southern Ęuro- 
"pea

, AfricaiIls, Asiatics, andSouth Americans.. 
. """C. Overseeing, 
nd frequent1y managing,education progrl;łms,con- 
servation ot resources, environmental control. 
-Control of the med.ia,.controlling propaganda. 
-- And of courge, maitntainirig, controlling, and tnanaging the .mi1i- 
tary production, technology, and preparedness, as well as conducti I1 g 
foreign and domectic intelligence, providing law enforcement, technolo- 
gi'es and services. 
The above makesit obvous that the "hands off" prescription for. the 
government isboth unrealistic and unwarrlinted. It is. quite evident that 
no large camplex,corporate entity, such. as anyroodern" industrililso- 
ciety, can exist without a coordinatingbod.y, Le. planning, management, 
and contral. .. . .... . 
The issue is altogether a clifferent one: Can the public maintain con- 
troi of, Ol' at least have an access to, the government? Thteexperience 
.
f last onehundred ye
s unquestionably indicates that itpresent,s a se- 
rious challenge, no matter what is the" acknowledged prevailing politieal 
philosophy .and political system. 
Adinitted1y. 'each society has its own unique problems to face and 
t9$0Ive. In the UB, it is .the laissez faire spokesmen who dictate the 
eon tent, the intensity,the atmospherte, and frequently fate ot the discour- 
se.,of contemplatted public action. As a rule of thumb, the tollowing may 
bestated. If a contemplated public action,. in its consequences is adverse 
tothe iJlterests of thebusiness, it most likely won't be 'votedby . t11e 

ngressinto law. But ewen if the Congressyilelds to the pressure oft:he 
public, theI'e are mechanisms to mute "unpopular" legislation. Thus, in 
order to securecooperation of the business, Ol' private enterprise, it 
musthavesomestake in it. And tł1ese are the realitiles ot life. This is 
" ,'n
t -the que:stion of whether it is right of wrong, it 15" the ,privUege"of 
.P9'we:t:. . .' . .' 
It . also ,shouldbe mentioned" in . rpassing,in . rięgard "to "stilla119tber 
; _m¥th
 th
myth that ,
rtrays the privateenterprise as łiQstil
 to. social
>>>
Some Selected Aspects ol the Dynamies... 


129 


\ 
change. This is simply not £o. T4ere is no other institution in American 
SQCiety - not even the government or the sciences - that affect change 
50 profoundly as the private enterprise does. Howevet:, the change oCcurs 
as latent (wnintended) functions and dysfunctions 0.£ purposeful profit 
pUTsuits. For exampllę, the emergence of suburbia. another trend toward 
megalopolis, oonstant transformation of the mode of living. changing 
tastes and fads. and the changing nature of the social pyramid aU ref1ect 
one universal social fact: Someone bas made some profit on itI This is 
the key to the und
rstanding of the stream of modern life. 50 where 
is the problem? 
The problem derives from the fact that power holders not only re- 
fuse to dean up after they are through with the i\east, but they insist 
that no one else does the cleaning j
b. For example. the ceal stripping 
industry lament when asked to reclaim the area they have mined, high 
sulphu r smoke emitted by power plants poi5Ons lungs. wild1ife, and la- 
kes because it is "too 'expensive to pudfy the smoke". and al:so the pro- 
blems of the unemployed, of the laid-off and of the retired - pretty 
much a result of economic fluctuations. But as these phenom'ena add in 
volume, some practicaUy have snowbaUed, both sides realize that £0- 
mething muąt be done. As this is one way of preventing the emergence 
of social movements and social strife. 
It was during the Great Depression that the greatest changes were 
made in recent history. It was F. D. Roosevelt who pushed through legi- 
slation creating public works for' the unemploY'ed. youth employment 
programs. impressive Tennessee VaUey Authority {TV A). and Sodal 
Security'Act of 1935. 
These, programs - it is sometimes suggested - established n'ew poli- 
tical real1ty. 50me caU it "democratic capitalism". 1people':g capitalism". 
stm others refer to it as a "welfare state". In 19305 Roogevelt referred 
to it as the New Deal. H. S. Commager suggests that long before Roose- 
velt. during Wilson's presidency. the principIe of tba weUare state had 
been aU but wniversaUy accepted. And the impact of this new mode of 
thinking can be ascertained in terms oi at least twa significant occu- 
renC'es. First1y, after the 1936 defeat of Alf Landon in presidential 
elections, Republicans decided te accept the New Deal program almost 
in toto. and secondly, and perhaps more importantly. the Supreme Court 
of the US saw it finaUy fit to abandone it8 tradition of harolrling Spen- 
cerian, Social-Darvinistic philesophy and accepted the view that it is the 
responsibility of the govermnent to avert major socia,l crisis and to cor- 
rect economic inequities. 8 As Theodore H. Wbite rightly stated, "there' 


II H. S. C o m m a g e r, op. cit., p. 317-318.
>>>
130 


Wacław Szyszkowski 


were, and always have be'en, the great issues in American politics: the 
first is war and peace, the second is black and white, the third is bread 
and butter".8 And still others have wondered '- especialIy C. Wright 
Mills, Howard Beckier, Richard Flae'ks, Gustavus Myers, Gary T. Marx - 
whether these do not serve to obfuscate even moce strategie issues. For 
example, it has been pointed out on nUIIl'erous oceasions that while 
public is arguing whether "private enterprise" (0£ laissez faire nature) 
Ol' goverinmental action, the issue is no longer I"elevant. The smalI entre- 
preneur is practicalIyextinct in the US and it has been done by the 
large-8Cale corporation, not the government. Of somie 60,000 private 
corporations, on1y smalI numool' - under 500 - tum out over 80 8 /0 of 
manufactured goods. And the competitioh among these giants - com- 
petition being Adam Smith's thekey to the understanding of the wor- 
kingsof the "invisible hand" - does not exist, neither these giants can 
affo:rd it, nor society. For instance, when Boeing Corp, wasfaeed with 
the ftnancial disaster because of the "over-runs" in aircraft industry, 
the Congress doled out over $200,000,000 in order toprevent the loss 
of jobs, revenue/... and piece of technology. 
The more active role of th!e government emerges as the result of 
social trends occuring over the period of last, more Ol' less, fifty years, 
a:ndnot as consequence of coming of age of democratic philosophy. There 
has be'en demythologizing of state authority and of the social order, the 
US emerged as an active international leader, awakening of the "inde- 
pendence" thought as ref1ected in emergence of new countries, insistence 
on 'Political equalities in internal political processes, and questionin,g of 
the "right" of the powerful to rule, unknown heI"etoforeexpansion in 
the !l'anks of intelligentsia, e.g. of alI the engineers who ever lived, 60 8 /0 
are aliVłe today; emergence of military technologies capable of annihila- 
ting the whole of humanity, emergence of the multiJplicity of well orga- 
nized and wellled national and international movements drawing on wide 
socio-economic bases, e.g. women's liberation movement, civil right mo- 
vement, counter-colonial (induding anti-oolonialism in Puerto Rico) move- 
ment throughout the world, demands for more humanitarian and egali- 
tarian redistribution of wealt:ł1 in a manner amicable to human dignity, 
and finally, for the first time, American public witne5Sed "all out fist 
swinging" cont'est between power holdingethnic groups, Le. the Anglo- 
-Saxon and the Irish, whichbecame so intensified after assassination of 
John F. Kenn'edy. It 18 within this context that the public voices demand 
for somie :resolurtion of the health oore aiIld old age SUlrvivors ulIsurance, 
post-employment income, and other long overdue public legislation. And 


, T. H. W h i t e, Breach oj F'aith. The Fall oj R. Nixon, New York 1976, p. 234.
>>>
Some Selected Aspects of the Dynamics... 


131 


it appears the scene is ready. AlI three branches of government perceive 
the n'eed for change. The most conservative of the three, the Supreme 
Court, as far baek as before tbe WW II, accepted the principleof govern- 
ment's regulation, such as was the case regarding the Minimum Wage, 
300 US 379 (1937), which overruled A d k i n s v. C h i l d l' e n' s H o s P i- 
t a l, 261 US 525 (1923). 
It was left, however, to Lyndon B. Johnson to implement reforms 
embedded iJn the New Dead philOOOlphy. One mus! mot forg,et tha! "his 
c,xmcept ofachievement was derived :fjrom the New Deal and Roose- 
velt - which dominated the formative years of his public life",10 John- 
son considered him.
elf as "truthful executioner" of his predecessor's 
John F. Kemedy's - will,ll JołmSO!n's: S'tir;altegy rWI8IS to make 
erty an 
issue of socia! concern. In his speech in Michigan University (Spring 
1964), he elałxmated his vision of the Great Society. In that speech, he 
declared his intention to go beyond Kennedy's legacy.His preoccupation 
was with thie need to eradicate poverty. However. it was only a compo- 
nent of the whole design. As his biogr'apher, Doris Kearns, emphasized 
inreality of his dreams - "these gigantic aspirations .[...] were not, howe- 
vter, intended merely as rhetorioal exhortation. They expressed John- 
son's intention to embal'k on a mammoth program of social reform".!2 
Johnson's program failed - a victim of Democratif party's i1nternal. 
internecine power struggle between the English and lri'sh power hoMera. 
Nixon's tenure had d'evastating impact. Whatever survived Johnson's 
reign, perished at the hands of the mediocre and the corrupt. He and 
his entlOu!l'aige thrived on ilnterethinic and 1Jnrt1el'lI'acial strife and COIllflict, 
programs of social reforms were pushed back on baC'k burners. His 
approach was full of contradictions. 13 While preaching decentralization 
of the government, a maintenet of his philosophy, in reality "he increa- 
sed control of his administration". Capita!izing on slogans such as "From 
WeUare toWol'k" and "What America needs now is not mOl"e weHare 
but moce' workfare, the very firstday after. his second .inauguration" 
(Jan, 20, 1973), "new Nixon plan wasannounced for the dismantling of 
the Great Society".14 Shortly thereafter, embattled in the Watergate 
scandal, he had no time, norenergy, to come up with a substitute plan. 
During Ford's and Carter's administrations, the dębate has renew 


10 D. K e a r n s, Lyndon Johnson and the American D
eam, New York 1977, 
p.146. 
11 Ibid., p. 146, 180-181,,305. 
11 Ibid., p. 220-221. 
18 Ibid., p. 146. 
14 Ibid., p. 382.
>>>
132 


Wacław Szyszkowski 


with the new vigor. It C'enters around the'questions of Social Security 
and the Medicare. 


SOCIAL SECURITY 


Social security, as a concept, reaches thousands of years into anti- 
quity. In its present version in the US, it derives from the Social Secu- 
rity Act of 1935. 
Social charity, as a principie of atVendlng the needy, applied several 
thousands years ago. In pre-industrial societies, it was the responsibility 
of the 
ulers to attend this task. The nature and the form of such ser- 
vices was normally defined by the institution of religion. 
It was in tbie second half of the 19th century that the charity was 
repla.ced by solid insurance programs, which achieved in modern society 
unptecedented career and popularity. But private insurance is an expen- 
sive undertaking and frrequent1y for the lower social dasse,s which are 
expected to get by on meager income - out of reach. 
With the onset of the New Deal, a goveI'nment sponsored and admini- 
stered insurance was introduced known as social security. To this day 
it remains a bone of contention between the conservatives and the libe- 
rala. 
The classic liberals (Adam Smith's version) even when they concedte 
that there is a need for a public insurance program, such as the Social 
Secwrity, they insist that it be supported by means of actuarial pre- 
miums, 'Le. deductions from workers' salaries and wages. The libertarian 
democrats, on the other hand, argue that there should be a variety of 
contributing sources, e.g. employee and employer's share of contributions 
and revenue. Of course, in th'e long run, it is the public that is "footing 
the bill", and in thle final analysis it boils down to the question of: at 
whose com (expense) and at what rate will society re-invest - or con- 
surne - its wealth (GNP - gross national produet)? Clearly, the laissez 
faire bent Social Darvinists ins[st that it be done at the expense of the 
poor. 
But social security is being criticized. It faces prospect of operating 
in the red. The reason for it is that the Social Security Act ol 1935 
has been appended fifteen times to inc1ude additional services. The le- 
gislators, in their attempt to prevent arousal of negative conservatiw 
reaction such as would ensue if, and when, new legislation was con- 
templated, prefer toawend existing l'egislative acts, and. thus the soclal 
security pro.gram has come to be known as a Christmas tree. 
Contrary to laissez faire protagonists, social security does not hurt 
private enterprise. Private insurance total coverage increased from
>>>
, 
Some Selected Aspects of the Dynamics... 


133 


$100 bi1lion in 1935, to the present $2,5 trillion (in 1978), deS'pitle the 
fact that the sodal security more than doubled life insurance protection 
in the nation, which at present amounts to approximateIy $2,8 trillion. 
Contributions are made, present1y, to four funds: Old Age, 55%, Life 
(survivors) Insurance, 17% Medicare, 170/0 and Disability, 11%. In 1977, 
in the USA, there were 33 million sodal security reci,pients. Some 108 
mil!ion workters and their empIoyers contribute to the fund. lII 
. In 1978 the Congress initiated action in response to alarming reports 
submitted by the Boaa-d ot Trustees to the effect that the OA SI (the 
Old Age and Survivors Insurance) and the Dl (Disability Insurance) 
would become depleted in the near future. As means of correcUng the 
situation, it was suggested that the expenditures be cut down. that 
employee premium be increased, that benefit skucture be thoroughly 
overhauled (leliminating some beneficiaries), that premium paying base 
be expanded to include higher income brackets, and finally. to dismant1e 
the whole program (suggested by Milton Friedman). Next to the last. 
of cour'5e, was strenously oposed by the private insurance companies.. 16 
In December 1977 the Cong.ress enacted Social SecuTity tax increase. 
But stil!, in case oi financial failure, there are many experts who con- 
template to cut the Social Security tax by shifting Medicare and disabi- 
lity costs into general Federal budget, what would mean certainly thie 
increasing of influence of the government on sodal problems. 
America's Ieading conservative senator, Barry Goldwa1!er, took nega- 
tive stance toward, what he calls, "attempt to forma welfare state".l'r 
Beingcritical of the F.D.R.'s argument that the US fell behind other 
countries in instituting sodal reforms, Goldwater maintains that the Nlew 
Deal programs were meant as the counter':depression measures, that these 
measures were to be of temporary durations, and that now since the 
job has be'en done, they are no longer needed. 18 His rhetoric include 
"ctmcerns" with dangers connected with the excessive concentration of 
power by the government, rampart proc1ivity toward creating innumę- 
rabIe regulatory agenciles, outgrowth of bureaucracy and the "excessive 



 
15 Staff Data and Materials Relating to Sodal Security Finandng, U.S. Oovern- 
ment Printing Office, Washington, June 1977, p. 3 ff. 
18 E.g. before Senate Finance Committee on Jan, 20, 1972, Spokesman for pri- 
vate insurance argued as follows: ."Maintaining a proper balance between the Social 
Security system and the private retirement media is important. If the proposed 
increase inłł!e earning [...] is adopted, we believe that the balance will be seriously 
distorbed [...j We strongly oppose this further increase". Congressional Quarterly, 
Weekly Report, No 5, Jan, 29, 1972, p. 218. 
17 B. O o J.;d VI a t er, The Coming Breakpoint, New York 1976, p. 35, 139-151. 
18 Ibid.. P; 39.
>>>
134 


Wacław Szyszkowski 


acquisition of power by labox unions".19 Moxeover, Go1dwater points out 
projections that around the year 2010 - due to the fact that the demo- 
graphic cohort born during the "baby boom" (immediately following 
the WW II), will re ach th'e retirement age - the number of social secu- 
rity benefits recipients will suddenly increase to 45 million (ca 5(0/0).- 
Of course, unless fiscal preparations are made, such development por- 
tends disastrous consequ'ences. 
. It is in the face of such prospects that one begins to appreciate the 
intricacies, complexities, and great responsibilities inherent in the corpo- 
rate interests of the natioos, and thus the coordinating role of the. go- 
vernment. 


MEDICAL CARE 


The Medi,cal care in the USA, as a public insurance program, is long 
overdue, according to some, and "ill-coneeived", according to "laissez 
faire" conservatives. It puz.zles the foreign visitor, to say the least. The 
United States, one of the most advanced technological societies, lacks 
a national insurance system. A far ery from what has been achieved 
elsewhere in the world. It is not uncomtnon that an individual's health 
eomplications result in the personal and the fami1y's finaileial disaster. 
Students of American society view this problem as pri
arily poli- 
ticaland admi!nistrative, not medical one. This point has been statted by 
Robert H. Connery,the president of the Academy of Political Science.2I 
It is generally recognizled that the medical reseaI\ch has made impressive 
progress in recent deeades, medieal profession is highly respected. The 
advocates of the national medical insurande system raise the question 
of how is it possible for the richest nation in the world to fail to provide 
general medical insurance for the publie, especiaUy for its impoverished 
ones. Edward Kennedy handles the problem, for example, in his dramatic 
book. 22 American Medical Association, on the other hand, leads the coun- 


19 Ibid., p. 140, 143. 
20 The demographic situation in America could be changed because of lower 
rate of total fertility (1,9 births per woman) what will cause growing old the popu- 
tation and increasing of number of candidates for old-age pensions, New York 
Times, March 31, 1978. Dr. C. F. Westoff's (Princeton University) report. Not only 
that the Americans are living longer, but the senior citizens need also more health 
services. 
21 HeQ.
th Services. The Local Perspective, ed. A. L e v i n, Proceedings of the 
Academy of Political Science, vo1.32, no 3, New York 1977, p. VII. 
ft E. M. K e n n e d y, In Critica
 Condition. The Crisis in America's Health Care, 
New York 1975, p. 17, 24, 206, 216, 240.
>>>
Some Selected Aspects of the Dynamics... 


135 


terattack. The AMA argues that national insurance of this 80rt spe11s 
"socialized" medicine, that universal coverage mak1es the poor excessively 
dependent upO'n the state, on the one hand, and it leads to corruption, 
malfeasance, overgrown bureaucracy and immoderate public e
penditu- 
res, on the other hand. They also point out the putative inefficency of 
public11y administered programs. 
The Chairman of the Senate Hiealth SUbcomittee, sen. Edward 
M. Kennedy synthesized i'nformation obtained through the hearing con- 
ducted by his subcommittee andcomes very strongly in support of 

national insurance systlem. 23 He is insistent in hisappeals that there is 
a need for the Health Security Act in order to be able to successfu11y 
cope with the present "tragic situation". Such legislation would guaran- 
tee health services to a11 Americans without regard to their income level, 
place of residence, sex, age, Ol' duration of incapacitation. 
Someargue - See, for instance, John Duffy's work 24 
 that those 
protesting against "socialized medicinle" should take cogni'za:nce that the 
government isalready providing insurance coverage to mi11ions of Ame- 
ric:ans by me ans of Veterans. Administration to thosewho served in 
Armed ForCies. 
The amendment of the Sodal Social Security Act took place in 1965 
50 as to include provisions for the Medicare and Meclicaid (US govern- 
ment health msurance programs for the agied. and poor, under Social 
Security). Thus, of course, these programs falls short of the universal 
coverage. 
It appears un1ikely that the US will follow the Britisch pattern. 25 
It looks to be so due to vehement opposition, not so much of the me- 
dical profession, as due to private enterprise. Th1e insurallice industry 
commands powerful pressure groups in Washington and is extremely 
efficient in getting its point across through lobbying. 26 And until now, 
tbe amendments of health systemwere normally advanced in such 
a manner as not to countervail interests of the private sector. 27 And as' 
Eugene Feingold writes, 


18 Ibid., passim. 
24 J. D u f f y, The Healers, Rise of the Medical Establishment, New York 1976, 
p. 319. 
25 Ibid. 
28 "T he health services industry is one of the largest sources of employment in 
the country, providing work for more than 4 million people" - E. P a d i 11 a, 
Community Participation in Health Affairs, [in:] Health Services..., p. 234-235. 
27 E. F e i n g o 1 d, Who Controls the Medical Care System? [in:] Health Ser- 
vices..., p. 199.
>>>
136 


Wacław Szyszkowski 


...health care is still seen as a private responsibility, with a lirriited role. 00- 
vernment entry into health care has not meant a broad acceptance of a public 
responsibility for the organiźation of health services.!8 


There is little doubt, however, thatpublic wants some kind of a uni- 
vters!łl coverage. Public debate has polarized between one position, which 
advocates enactment of British model, and another view which argues 
for more cautious approach, Despite their normalIy progressive stance. 
Ane and Herman Sommers, welI known for their contdbution to health 
care policy, recommend restraints in pushing toward universal coverage. 
In an interesting polemic between Sommers and Eli Ginzberg, £rom 
Columbia University. Sommers declared: 


...we are three pluralists wit h a elear preference for private sector or action. 
At the same time, we all recognize that government has some inescapable respon- 
sibilites and fuctions __ whether done well o,r poorely.ł9 


As a matter of fact, Ginzberg bluntly dec1ares that the last 15 years 
of govternmental performance makes him cautious "abOut the ability of 
the federal governme.nt to accom,plish a great deal even it invest large 
additional sums". In addition, he pointed out that in the American poli- 
tical system the eonventional manner for the federal government to 
alter the delivery of sodal services is through the means of state and 
local governm'ents. ao And it is generally known that over 40°/0 of the na- 
tional health care expenditures js being paid through the federal govern- 
ment; projections predict this proportion wilI soon rise to .over 500/0, 
with Ol' without national health insurance. a1 
National health insuranceproposal has been in Congress for over 
thirty years ami, therefore, despite pronounc'ed opposition to it, one can 
expect, sooneror later, some liroited and compromising legislation to 
finally materialize. A conservative member of thle House, Richard Fulton 
of Tennessee concurred that the 


, 
18 Ibid., d. V. N a v a r r o, Medicine under Capitalism, New York 1976. 
Ił A. R. S o m e r s, H. M. S o m e r s, Reply to Eli Ginzberg, Inquiry, 1/1978, 
p. 80. 
80 E. O 1 n z b e r g, Rejlections on Som.ers (Somers, Inquiry, 1/1978, .p. 76). 
81 In the past fifteen years, health spending has increased from 3 billioh in 
1950 to 9 billion in 1967 and to 50 billion in 1975. An estimated 8 percent of the 
gross national produet now represents health expenditures (less than 5 percent 
in 1950), & L e v 1 n, The Significance of Local Health Care, (in:] Health Services..., 
p. 1.
>>>
Some Selected Aspects of the Dynamics... 


137 


...idea of national health insurance is an idea whose time has cpme. The 9uestion 
is no lon,ger whether or not we need national national insurance plan. The question 
is what plan? And when can we develop (a plan) that works?82 
It appears that solutions must be sought in a piecemeal fashion. Some 
drastic transformation in the ovferal1 societal design is highly unlikely, 
at least not in the foreseeable future. The most feasible and palatable 
is a compromiJSe that would be capable of combining elements of apublic 
(national) plan and private industry's financial interests. 
It can safely be predicted that the main opposition will derive from 
the private insurance industry. On the other hand, the medical profession 
bas alrteady been somewhat conditioned by having accepted different 
functions in ser vice of private insurance companies. This lattęr deve- 
lopment, initially, was vehemently opposed by' physicians on the grounds 
that it involved "third parties" and as such interfered with doctor 
 
patient relationship. After having gone this experience, it is expected that 
the medical profession will be more susceptible to cooperate with govern- 
ment sponsored and supervised health care services. Su ch development, 
no doubt will significantIy alter societa} inter-institutional arrangements. 
At the time of the writing of this artic1e, the country is still awaiting 
president Jimmy Carter' s proposais :which will be sent to Congress. 


CONCLUSIONS 


" 


One of the most outstanding students of American society, the Swedish 
sociologist, Gunnar Myrdal, stated in 1960s that the United States has 
matured sufficient1y so as to be able to advance to the stage of the 
welfare state. At the opposite extrerne of the spectrum, classical liberal 
economist, Milton Friedman, d,oes not totally reject governmant's input. 33 
The responsibility of the federal government to protect the Union and 
to guarantee pur suit of individual freedoms is stated in the US constitu- 
tion. Even Richard Nixon, well known for his con.servative orientation in 
the matters of economic af:fairs, imposed lpI'IiJce oon1Jrolis when such a move 
deemed necessary even though, of course, it constitutes antithesis of 
laissez faire philosophy. I t appears that no matter whatare the predom- 
inant ideólogical orientatio.ns in vogue, Americans first of all are pragma- 
tistS. 34 


S2 Hea!th Services..., p. 213; "Although the society is moving toward institutio- 
nal integration and greater governance of health care than is now politically accep- 
table, its ultimate form and operation will be uniquely American" - B. J. F. M o t t, 
The New Hea!th Planning System, [in:] HeaZth Services..., p. 254. 
8S M. F ri e d m a n, Capitalism and Freedom, Chicago 1962, p. 7-19. 
S4 Cf. J. K. G a l b r a i t h, The New Industrial State, New York 1968, p. 405- 
406..
>>>
138 


Wacław Szyszkowski 


Whatever one's position on the subject of universal mediCal coverage 
and social security, it is becoming exceedingly difficult to refuse to see 
thle need for the government to protect and to assist the downtTodden. 
To faił to see the above normally results from the myth of confusing the 
realm of values and ideology, on the one hand, and the world of tangible 
and preseribed, on the other hand. Classicalliberalism, in its most ruggied 
SQcial-Darvinistic edition, as was the case with England, Germany and 
France during the initial stages of the industrial revolution, was a brutal 
one. The world has progressed a lot since thłen, a lot more remains to be 
done, and American liberalism is favorable to reform.35 . 
The above discussion addressed only two specific areas, Le. the social 
sec1:1 1it y and tl1te medical coverage. There are other, perhaps more stra- 
tegie, which also. merit attention. For example, there is already some 
momentum observable around the ilSsue of guaranteed annual inoome, 
policies needed regarding cybernation, a need to restrueture labor market 
practices, etc. 
It is normally agreed that the future holds more governmental inter- 
vention, Ol' 18 this only a matter of making it more sensitive to the needs 
of the publicas opposed tospecial interes t groups. 


8& See the modern detinitions ot liberalism and conservatism: M. Z i m m e r- 
ID a n, Contemporary, Problems ot Democracy, New York 1972, p. 94, 97; Ct. 
A. K a u t m a n, The Radical Liberal. The New Polities: Theory and Practice, 
New York 1970, passim; R. S h o g a n, Promises to keep. Carter's First Hundred 
Da1ls, New York 1977 - "Many ot the major promises Carter made were cautiously 
and someUmes arttully phrased, to avoid antagonizing important voting blocks, 
an
 to give him maximum room to maneuver as candidate and as President [...J He 
favored mandatory national health insurance, but could not yet say what role pri- 
vateinsurance companies would play in the system" (p. 43).
>>>
ACTA UNIVERSITATIS NICOLAI COPERNICI 
PRAWO XVIII - NAUKI HUMANISTYCZNO-SPOŁECZNE - ZESZYT 108 - 1979 


The University 01 Detroit 


Wieńczysław Wagner 


THE WARRANTY IN AMERICAN LAW 


c o n t e J,1 t: Historical development of the warranty in American law. Written 
law. The cases: -Baxter v. Ford Motor Co., Henningsen v. Bloomfield 
Motors, Osborne v. Genevie, Collins v. Un"iroyal. 


HISTORICAL DEVELOPMENT 


With the ever increasing feeling that consumers of goods and persons 
who acquire interests in real estate should be protecJted against possible 
overreaching and disappointment, neW legal theories are being developed 
to help the buyers, lessees and tenants, and old doctrines receive new 
emphasis. 
- The tlr:adiJnJg customs of yesteryJe8lI'la, dow1n to the _ 
 of thłe , 
current century, may not have quite conformed to the present ideas of 
fair dlealiJng, anJd Ithe main pr.itnciple ol the day WaJs "Cal\1leat Emptor" - 
let the buyer beware. In general, the risk that a transaction will prove 
to be disadvantageous was on him, and the law pennitted the seller to 
" minimize the chances of becoming liable by developing many rule's favor- 
ing finalityof the sale and absolving bim from responsilbility for induci'l1g 
the buyer into a purchase which could be disastrous for him. Thus, e.g., 
in the law of fraud and deceit, any opinion expressed by the seller about 
his. goods, as knowingly false as it could be, was held not to entitle the 
buyer to rely on it and challenge the sale, and if the buyer did not 
di1igenty check ihe veracity of ihe other party's.a;ssertions of false facts, _ 
ma!:łe with scienter, he was usually held to have been contributorily 
negligent and unable to submit a valid claim, contrary to the wen esta- 
blished common law rule that such negligence could not defeat the right 
of action against intentional torts. ' 
Even 50, the idea of warranty developed early and in its limited 
applicaiion under earlier law, it constituted sorne degree of protection 
which the law was wHling to give to the buyer. The 
urts: w'ere much
>>>
\ 


140 


WieńczySław Wagner 


mor e prol1e to grant relief on the ground of express 'Warranty than 
implied, and if the seller kept quiet and did not volunteer to make aby 
starements, it was difficult to prevail aver him. But many assertions 
may be interpreted in various ways. If not quite cleM, they may be 
understood either as statements of opinion Ol' of facts, and in alder times 
the caurts would construe a statement made by the seller as amounting 
to an expression af apinion, much more 'willingly 'than they do today. It 
may be said thatfrequenrtIy the.oLd formula af "let the buył& beware" is 
giving way ta the new one, "let the seller beware", because anything he 
says to the buyer may be held by the courts to amount ta an express 
warranty with the result
ng liability if the produet daes not live up to it. 
In the system of products liabiliiy and consumer protection of today, the 
law of warranty is one of the three main thearies which may be used 
against the manufacture;r and the seller, along with that of negligence 
arid the newest approach of strict liability irrespective of warranty. 
Except for some fields af thelaw strictly connected with the American 
govel,"nmental system suchas constitutional and administrative law, and 
the new fields such as taxation and air law, the law of the United States 
is based on the English common law. In its historical development, 
w.arirenty ascillated betiWeen torts aIIld oontracts. In old law, it 1W'aS asso- 
ciated with tarts on the groUlnd inai i,t W8/S si:miLar to deceit. Ho:wever, 
while deceit was based an the 'knowledge of the falsity of' the statement,' 
ar at least 'I"ooklessness (arułe which faund ist finał expa:tession in the 
l celebralted cafse of D e rr l' yv. P e e Ik), HabtJ.rity for Ił breach of warranty 
did nat require any proof af fault. 
. Then, in t
 seoond paiI"t af the XVIII centu.ry, while retainiog its 
connection with torts, warranty becarne associated with the law of can- 
tracts,andif it was breached, an action on thlecQntract WQuld lie. Thus, 
the 
gtrileved party usually bad the choice O!f 'br'mgiJng ei!thell" one Ol' the 
other action - that is, of course, if the parties were bound by a contraet. 
For a long time, this contractual link was necessary to recover not only 
f'Or a breach of warranty, but also for damages caused by negligence. The 
best known English case, W i n t e rb o t t o rn v. W r i g h t,1 which 
denied liability to an injured third party who nad no "privity of con- 
tract" with the defendant, was decided on contractual grounds, but. in 
subsequent cases its holding was expandedor misconstrued and became 
an authority for depriving the plaintiffs of recovery in tQrt as well., It 
took a long way to change the apprQach of the courts, and after some 
cases in which the decisions went for the plaintiff on the ground ofexcep- 
tions grafted on the general rule, the brea'kthrough was made by the 


\ 16 M. & W. 109, 152 Eng.Rep. 402 (1842). '
>>>
The Warranty jn American Law 


141 


highest court 01 New York in M ac P h e r s o n v. B u i c k M o t o l' C 0. 2 
in 1916. 
The emergeIlce of the rule that a tort c1aim for a breach of warranty 
lies irrespective of tbe privity ofcontract did not occur before the begin- 
niIlg of tłle XX century, and for a long time, its application was limited 
to . f()()l(jsand drugs, 8InJd then oosmetics aIS 'Welł. A half centwry elapsed 
before the new approach began to be applied to other s
tuations. As 
a leading writer comment's, the suddenenthusiasm of the courts to 
modernize the law on this point met with the general approval of the 
commentators and scholars3 who emphasized the difficulties that the 
consumers had in establishing negligence, the effect that more stringent 
liability rules would have on the quality of goods and services, and. the 
advantages ot the ruleplacing the losses on the manufacturers and seUers 
who ,are able.to absorb them by establishing the prices .and taking out 
insurance, Dean Piros.ser states that the main TeaooI1lS given by the legał 
writeI"S .itnc1uded thłe following:4 
l.The import ance of human safety and life requi'res assuranees that 
the products put on the market will be as good as possible, and if they 
do not live up to standards which can be expected and attained, those 
responsible for marketing them should bear the consequences. 
2. The suppliersof goods make efforts to convince the general public 
that their iroducts are good and safe, and to persuade the consumers to 
purchase them. If they succeed and the 'Lise of the goods results in an 
injury, the defense of immunity from liability because of the la ck of 
privity of contract shouldnot be available. 
3. A directsuit brought by the consumer against the manufacturer 
results in avoiding a circuity of action, in which the buyer is permitted 
to recover from the retailer, the retailer from the wholesaler, and the 
wholesaler from the producer. This long and expensive chain of litigation 
(which, incident
ly, may break somewhere because of various reasons 
such as ban'kruptcy, disclaimers ar statutes of limitations) should be 
shortenedby aU means. 


WRITTEN LA W 


While each American state has its own legal system and adopts - by 
statutes or judicial opinions 
 legal rules it deems fit, there are endeavors 
to make the law uniform at least in those fields which are applicable to 


J 217 N.Y. 382, 11 N.E. 1050' (1916). 
· Prosser on Torts 650 (1971), 
ł Ibid., at 651.
>>>
142 


WieńczySław Wagner 


transactions between the residents of different states. The initiative was 
taken in the second part of the XIX cen tury by the American Bar Assoc- 
iation, and soon after, the Commissioners on Uniform State Laws began 
to recommend uniform statutes for adoption by the states. The first great 
success was the Negotiable Insti'uments Law of 1890, whi
h was accepted 
by aU of the states. As in other federal countries, such as Germany and 
Switzerland, commerciallaw Ol' some of its parts were thefirstto become 
uniform throughout the nation. Soon after the N.I.L., another important 
statue was prepared by the Commissionern in 1905 - the Uniform Sales 
Act, whićh included provisipns dealing with warranties. Of course, they 
regulated the rights and obligations of the parties to the sale transaction 
alQne. The Act was adopted by about three fourths of the states. 
The greatest success of the trend to make American law uniform was 
achieved by the Uniform Commercial Code, which was recommended by 
tbe Commissioners in 1952. After a fast acceptance by Massachusetts 
and Pennsylvania, the Code recived a blow in New York which rejected 
it with criticism of some of its provisions. The Commissioners re-cons- 
idęred the text and brought it into the line with the New York thinking. 
Thereupon, the State of New York adopted it and other states folIowed 
with the Tesułt that by now the Code isilIl foiI'Ce in 8111 of the states except 
Louisiana which respects its civil law'-tra1ition, based on the FrEmc;h. 
patterns, and. has decided to preserve its separate approach. The Code 
replaced a11 previous enactments and the case law in the field of com- 
mercial law. By and large, the Code fo11owed the rules of the Uniform 
Sale s Act with respect to the warranties, but it modernized them and 
added some ones, and in partieular those which extended the coverage of 
som e of the Code' s provisions to some third parties. 
Clearl)", the first rightful expectation which the buyer has is thilt the 
seO.ler may va1dd1y oonvey tohim the ri,ghts iIIl the subj'ect matter of thle 
transaction. Therefore, the first provision of the Code. dealing with 
warranties states, in 
 2-312(1), that in contracts for sale the seller 
warrants that 


...(a) the title conveyed shall be good, and its transfer rightful; and (b) the 
goods shall be delivered free from. any security interest or other Hen or encum- 
brance of which the buyer at the time of contracting has no knowledge. 


Subsection (2) pea:mits the exclUiSion ar mod1i.fdoauOIll of the above 
warranty "only by specific language", and a similarresultwil1 be 
achieved "by circumstances which give the buyer reason to know that 
the person ,selling does not c1aim title inhimself ar that he is purporting 
to sell only such right Ol' title as he Ol' a third person may have". Accord- 
ing to the official comment to the Code, the main idea of this provision 
\
>>>
The Warranty in American Law 


143 


is that sales by sheriffs, executors, forec1osing lienors and persons simil- 
arly situated areout ofthe ordinary commercial transactions; therefore, 
the buyer should be aware of their peculiar character and cannot claim 
personal responsibiIity of the seller "who is purporting to sen only an 
unknown Ol' limited right". . 
In previous law, a "warranty of quiet possession" was frequent1y 
found to have a separate existence. The official comment makes it elear 
that this warranty is abolished, because even if not mentioned specifically, 
"i(td)ilStUil"baJl1iCe of quiet possession [...] 
 one way, acrnOrI1ig many, in which 
the br'each of the 'WaJrraJnty of title may beestablished". As in other 
instances of warranty breach, the buyer should give proper notice to the 
seller within a reasonable time. 5 
The next section of the Code, 
 2-313, deals with express warranties 
which may be made by affirmations, promises,descriptions Ol' sampies. 
The key provision in subsection (1) (a) states: 


Any affirmation of factor or promise mad e by the seller to the buyer which 
relates to the goods and becomes part of the basis of the bargain creates an express 
warranty that the goods shall conform to the affirmation or promise, 


The .:rema ' ini1ng proVlisions of subsootion {1) state that aJny description 
of the goods as well as any sample Ol' model amounts to an 'express war- 
ranty as well. Subsection (2) adds that the use of formal words such as 
"WiaJl"raiIlt" or "gUialI'aJntee" iJS unneoeLS1Sarry. Ag/alin, the specific intentioo of 
the seller is not required. On the other hand, a mere affirmation of the 
value of the goods and statements intended to express the seller's opinion 
or commendation of the goods do not create a warranty. 
The official comment makes it elear that while the text of the Code 
speaks about the seller-buyer relationship, the rules on warranties may 
be applied in other situations, such as bailments for hire. Section 2-318 
of the Code recognizes that case law may expand the rights of the third 
party beneficiaries, and "the policies of this Act may offer useful guidance 
in dealing with. furthel' cases as they arise" .The comment continues to 
elaborate on the idea of description. It does not have to be by words. 
"Technical specifications, blueprints and the like can afford more exact 
description than meTe language". Again, ,,{p)ast deliveries may set the 
description of quality", and aU descriptions must be understood in the 
light of the applicable tra de usages "with the general rules as to merchan- 
tability resolving any doubts". 
After stating the rules dealing with express warranties, the Code 


5 Section 2-607 of the Code states that the buyer will "be bart,'ed from any 
remedy" if he does not notify the seller about the breach of warranty "within 
a reasonable time affer he discovers or should have discovered it".
>>>
144 


Wieńczysław Wagner 


passes on to the implied ones. Section 2-314 Iays down pravisians appli- 
cable to the old and well established idea of warranty of merchantability 
which is sometimes referred to as the warranty of saleability. By virtue 
of subsection (1), it attaches only if the seller is a merchant with respect 
to goods of that kind. The serving for value of food and drink is included. 
Subsection (2) clarifies the idea of merchantability. In order to meet the 
test, the goods must be at least acceptable in the trade, of fair average 
quality within the description, fit for the ordinary purposes for which 
such goods are used and adequately contained, packaged, and IabeIed as 
the agreement may require. Besides, they must conform to the promises 
cxr affirmations af faot mad!e on the oonJta1JnE!lr 011' Label if aIIly. Subsection 
(3) adds that ,,(iU)nless excluded Ol' modif,ied [...J otherimplied warr,anties 
may arise from course of dealing Ol' usage of trade" . 
The official comment makies it elear that the above rules do not apply 
to contracts Ol' the sale af, second-hand goods, where only those obliga- 
hons obtain which are "appropriate to such goods". Again, the provisions 
do not cover persons who make an isolated sale of goods because they 
are not "merchants". However, if they know of any defects not apparent 
on inspection, they have an obligation to fully disc10se these hidden 
defects, in accordance with the requirements of good faith. Of course, 
non-merchants may voluntarily assume obligations based on warranty 
by a proper statement. This will be understood as an express warranty, 
,and will have particular significance in the case of second-hand sales. 
Another well-established implied warranty, that af fitness for a par- 
tioular PUlI'pOlSe, ts desc'ribed in the neX!t srotion, 
 2-315. lt reads 8JS 
follows: 


Where the seller at the time ot contracting has reasOn to knowany particular 
purpose tor which the goods are required and that the buyer is relying on the 
seller's sltill or judgment to select or furnish suitable goods, there is unless excluded 
or modified [...J an implied warranty that the goods shall be fit for such purpose. 


The Official eomment explailns tmt the diffełrence between the "Palf- 
ticular purpose" of thebuyer and the ordinary purpose lies in the idea 
that theparticular purpose "envisages a special use" by him "which is 
peculiar to the natur e of his business" in contradistinction with -the "uses 
which' are customarily made of the goods in question". Clearly, the 
warranty of fitness does not exc1ude the one of merchantability, and both 
of them attach to the same contracts. In instances where they are 
iriconsistent With each other, the warranty of fitness for a particular 
purpose should prevail "except where the buyer has taken upon himself 
the, resprinsibility of furnis'bing the technical specifications". 
, The principie offreedom of contraet, prevailing in the traditionallegal
>>>
The Warranty in American Law 


1415 


systems, requires the recognition of the possibility of excluding warran- 
ties by mutual consent of the parties. This democratic rule met with 
a great deal of abuse. It is a well known fact that by the use of form 
contracts, powerfulbusiness enterprises, andfrequently even their 
associations which sometimes monopolized a fieldof business life, imposed 
some contractual terms on their clients, and in particular, di!3claimed the 
wan"anties. UsuaUy, it was done in smaJl prilnt, frequenrtJly tm the reverse 
side of the contract prepared for the signature of the other party. 
The general clause of the Code against unconscionable contracts 8 may 
be a useful weapon against such practices. More specific provisions 
protecting unwary buyers against disc1aimers of warrantyof which they 
are unaware are found in section 2-316 of the Code. Subsection (2) states: 


...(T)o exclude or modify the implied warranty of merchantability or any part 
of it the language must men.tion merchantability and in case of a writing must be 
conspicuous, and to exclude or modify any implied warranty of fitness the exclusion 
must be by a writirig and conspicuous. Language to exclude aU implied warranties 
of fitness is sufficient if it states, for ex ample, that "there are no warranties which 
extend beyond the descriptiononthe face thereof". 
Exceptions to the general rule are provided in subsection (3) which 
enumerates a few situations in which implied warranties will be excIuded 
Ol' modified. First of all, in the absence of indications to the contrary, 
a valid disclaimex: of all implied waJrrantites will be effected by an e"-'Press- 
ion like "as is", "withall faults" Ol' others which in common understand- 
ing draw the attention of the buyer "to the exc1usion of warranties". 
The resul1 wi.1l be similar if the buyer exammes the goods OIl'the 
sample as fully as he desires before entering into the contract, Ol' refuses 
tx examme the g();()(ts. Then, ,,'D(t)here :i:s 1110 impliedwam8lIlty with regard 
to defects wł}ich an examination ought in the circumstances' to have 
revealed to him". Finally, a "course of dealing Ol' course of performance 
Ol' usage of tra de" mayaiso exclude Ol' modifyan implied warranty. 
There are two additional sections in the Code dealing with warranties. 
Section 2-317 provides that if various warranties attach to a transaction, 
they shalI be construed as consistent with each other and as cumulative. 
In case su ch a contstruction is unreasonable, "the intention of the par
ies 
shall determine which warranty is dominant". Frorn among a few rules 
given by the Code for ascertaining the intention, the most important 
seems to be that ,,(1t!)xpress warranties displace inconsistent implied 


· Section 2-302(1): If the court as a matter of law finds the contract or any 
clause of the contrac"t to have been unconscionable at the time it was made the 
court may refuse to enforce the contract, or it may enforce the remainder df the 
contract without the unconscionable clause, oc it may so limit the application of 
any unconsCionable clause as td avoid any unconscion4ble result.
>>>
146 


Wieńczysław Wagner 


warranUes other than an implied warranty of fitness for 'l particular 
purpose" . 
The official comment limits the application 0-£ these rules tv situatioI\s 
in which the seller "ha s in perfect good faith made warranties which 
later tum out to be ineonsistent". Otherwise, if he "has led the buyer to 
believe that a11 of the warranties can be per£ormed, he is estopped from 
setting up any.essential inconsistency as a defense". 
$ection 2-318 of the Code could not be a part of a statut e in a unitary 
country: it gives three alternative5, one of which should be selected by 
each state in a federal union whose members D'lVe their own legal 
systems. The section deals with thlrd party beneficiaries Qf warranties, 
express or implied, taking into account the fast developing trends to 
extend warranty protection to parties who are not bound by the rela- 
tionship of "privity of contract" with the se11er. The first alternative is 
more conservative than the tw'.) fo11owing ones and CO'.7ers only a limited 
circle of persons: 


A seller's warranty whether express or implied extends to any natural person 
who is in. thE: family or household of his buyer or who' is a guest in hi3 home if 
it is reasonable to expect that such person may use, consume or be affected by the 
geods and who is injured in person by breacn of the warranty. A seller may not 
exclude or limit the operation of this section, 


As the official comment adds, every beneficiary of tbis alternative, 
as we11 as of the two remaining ones, "may bring a direct. action for. 
breach of warranty against the seller whose warranty extends to him", 
while any right Ol' remedy resting on negligence is not affected. The first 
alternative "is not intended to enlarge Ol' restrict the developing case 
law on whether the sellers's warranties, given to his buye: who resells, 
extel1d to other persons in the distributive chain" . 
The second ałternative łays down a more progressiv
 rule, extending 
the benefits ol the warranty to a broader circle of potential plaintiffs - 
but giving them the mght to SiUe far personal injw-ies ónly: 


A seller's warranty [...] extenós' to 8ny natural pcrson who may reasonably be 
expected to use, consume or be affected by the goods. and who is injured in person 
by breach of the warranty. A seUer may not exclude or limit the operation of this 
section. 


Tbis alternatiye is a restatement, of the/ approach previo'Usly taken in 
some of thestates. It was accepted by a few others. n will be noticed 
that it does not grant any benefits
o person s who should not use or be 
affected by the goods, such as thieves and trespassers. 
The last alternative goes still furthel'. It OJnits the words "in person", 
permitting claims for commercial Ol' pro perty damages besides personał
>>>
The W
n;anty in American Law 


147 


injulies. It prohibits c1isdaimers of warranty for persona} injuries ,,0£ an 
individual to whom the warranty extends" (as amended in 196G). As th
 
official comment explains, this pr
'lision is not intended to abolish 
disc1aimers - buf. in case there are any warranties, they 
U8t extend to 
all persons covered by thc section. The seller cannot give a w
rrant,y to 
his immedi:łte buyer while providing .for the exclusion of anyone else, 
Connected to the a"ove provisions is section 2-719 of the Code, whose 
subsection (3) states: 


Consequential damages may be limited or excluded unless the lirr.itation or 
exclusion is unconscionable. LimU&tion of consequentlal damages for injury to the 
person in the case of consumer goods is prima faci-= unconscionable but liinita
ion 
of damages .vhere U.e 10ss IS commercial is not, 


A few of the states went further '"ha n the alternatives of the Code and 
prohibited disclaimen, 01 warranties with respeet to consumer goods and 
"ervices (California, Maine, Maryland, Massachusetts). It may he added 
that beginning in the 1960's, the federal Congręss became evcn more 
involved in consumer protection, following extensive public diseussions, 
frequently led by \lIr. Ralph Nader. Safety is one of th
 primary preoe- 
cupaNons of the gove:rnment. One of thefiir.st and mOlst importan1 statutes 
WISS the National Trafne alIld Matm Vehicles Sa fet y Ą.ct of 1966. 7 Another 
one was the Consumer Produet Safety Aet of lf.172 8 which createci a new 
ageney 1:y the name of the Consumer Produet Safety CommisGion, super- 
vising the products on the market and establishing ,safety standarde. 
A more reeeJ1t Warranty - Federal Trade CommissiC'n I.nprovement Ad 
of 1975 9 regulates the form of warranties ahd has some bearing on their 
content and on the seope of possible disclaimers with respect to goods 
sold with some warranties. 
It may be added that sec. 402B of the Restatement of Torts 2d (an 
unofficial set of rules prepared by the American Law Institute) reaches 
a rcsult similar to that of section 2-318, 3rd alternative of the Uniform 
Commercial Code but on the theory of liability for misrepresentation, be 
it innocent Ol' not, without the requirement of privity of contract. 


CASES 


Among the well known decisions on express warranty, the case of 
Baxter v. Ford Motor Co. (1932)10 should be cited. The company 


7 15 u.S.C., 
 1381 ss. 
s 15 U.S.C., 
 2051 ss. 
· 15 U.S.C., 
 2301 ss. 
tl 168 Wash. 456, 12 P.2d 490 (1932). 


,....J
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148 


Wieńczysław Wagner 


was distributingcatalogues and other printed rńatters to its dealers with 
the viewof passing them on to the prospective customers and inducing 
sale s of its automobiles. One of the statements represented the windshields 
installed in the cars as shatterproof - ,;50 made that it will not f1y or 
shatter under the, hardest i1npact. This is an important safety factór 
because it eliminates,the dangers of flying glass [...]". The plaintiff 
purchased a car 'from a Ford dealer, and soon after a pebble thrówn by 
a passing car struck the windshield of his car, causing smalI piece s of 
glass to f1y into his left eye which resulted in its loss. Plaintiff brought 
an action for damages for the loss of his left eye and for injuries to the 
sight of his right eye, against themanufacturer and the dealer. 
The company contended that there can be no warranties whatsoever 
withóut privity of contract. The court did not agree, saying that it 
...would be unjust to recognize a rule that would permit ,manufacturers ol 
goods to create a demand tor their products by representing that they possess 
qualities which they, in fact, do not possess, and then, because there is no privity 
of contract [...J deny the consumer the' right to recover ii damages result from the 
absence ot those qualities. 


The oase which exerted a very strong ilnfLuenlCe thl1'Oughaut the United 
approach. ll The B a x t e l' case was widely followed, the requirement 
that in order to recover the plaintiff must have relied on the defenda t1 t's 
statements being frequently emphasized. 
The case, which exerted a very strong influence throughout the United 
States, both On the point of discarnng the necessity of privity of oontract 
and limiting thiJ defense of disclaimer of warranties was H e n n i n g $ e n 
v. Bloomfield Motors,12 a New Jersey case of 1960. The wife of 
the purchaser was injuredbecause of a defect of a car bought from 
I a dealer of Chrysler Corp. DiBcil.tSSUlng the probJ.lem of privilty of coota'act, 
the court observed that this requirement developed in old times, "when 
m
ker and buyer frequently met face to face on an equal bargainlng plime 
and when many of the products we re relatively uncomplicated and 
conducive to inspection by a buyer". The situation changed completely 
in the era oi mass marketing, where 
...the manufacturer became remote from the purchaser, sales were accomplished 
through intermediaries, and the demand for the product was created by advertising 
media [...] (T)he burden ot losses consequent upon use of defective articles is borne 
, by those who are in a position to either controi the danger or make an equitable 
distribution of. the losses when they do occur. 


11. The tria! resulted in a verdict tor the plaintiff, and the company appealed. 
The judgment was affirmed, the court emphasizing, this time, the misrepresentation 
aspect of the case. 179 Wash. 123, 35 P.2d 1090 (1934). 
II 32 N.J. 358, 161 A.2d 69.
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The Warranty in American Law 


149 


The couit concluded that rather than bemg based 00 pr1vlty of 
contract, the obligation of the manufaf',turer should rest upon "the 
demands of social -jUstice". by virtue of which. if a car i"5 put on the 
market and advertised to the public, "an implied warranty that it is 
reasonably suitable for use [...) accompanies it into the hands -of the 
ultimate purchaser". 
Again. the reasoning of the H e n n i n g s e n case was well accepted 
by the legal sćholars and the courts. The decision began to be frequently 
cited in New Jersey as weH as iIn other states. Tbus, e.g., in Jak u-' 
bo wsk i v. Minnesota Mining and Manufacturing. 1ł an 
implied warranty of merchantability on a gririding disc, which attllched 
to a contract of sale between the manufacturer and the plaint;ff's employ- 
er who was the buyer, was held to extend to the employee using the tool 
with his master's consent. By analogy to the H e n n i n g s e n' s approach. 
the court branded the plaintiff as "a member of the Ford plantfamily 
whose use of the grinding disc was certainly within the reasonable 
. anticipation of defendant" . The court stated that the implied warranty 
was "a matter of stri'\t tort liability, not dependent upon a contract 
between the parties" . ' 
The H e n n i n g 
..e n case bcc'ame also an important precedent for 
limiting the effect of the defendant's disclaimers Ol' limitations of war- 
ranty. On the reverse side of the purchase order signed by the buyer, 
there was a statement amounting to an express warranty, whose terms - 
occording to the court - were "a sad commentary upon the autom()bile 
'manufacturers' marketing practices". Instead of serving the interests of 
consumer, because of the ingenuity of the Automobile Manufacturer's 
Association, the warranty "has metamorphosed [...] into a device to limit 
the maker's liability": by the terms of the 5tatement, the manufacturer 
agreed, under someconditions. to replace the defective parts of the car 
if they are "sęnt to the faetory, transportation charges prepaid, and if 
examination discloses to it5 satisfaction tbat the part i5 defective" Tbis 
remed
! was given ..in lieu of all other warranties, express or implied. and 
aU ofher obligatiqns or liabilities". 
The court made some critical comments about the standardized form 
contracts. emphasized..the gross intequality of bargaining position occupied 
by the consumer in the automobile industry". and ccnc1ud
 that Buch 
a limitation of tbe buya-'s remedies was "inimical to the public welfare" 
as it was "dictated by the maker". Therefore, the attempted disclaimer 
of the implied warranty of merchantability was held to be invalid. 
From among many other cases, showing the disfavor with whieh the 


II 80 N.J. Super. 184, 193 A.2d 275 (1963).
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150 


WieńczY6ław Wagner 


( 
courts treat. 
laJimetrs of wa!'Tanty, llet jUlSt two be cited. In O s b (, l' n e 
v. G e n e v i e,14 the plaintFf purchased a mobile home under a contract 
which stated that tbe trailer was sold "as is".This statement was written 
in the same size and color type as the cther parts of the contract. As 
above mentioned,the Uniform Commercial Code provides that disclaimer 
c1auses are valid if they are "collspiplOUS", but that expressions, like ,.as 
is" will do. On the other hand, another sectiori oI the Code states that the 
language is "conspicuous" if "it is LTl larger or other contrasting type Ol' 

olor".15 The question to be deoidided by the coucrt WB!S wheU,er the re:uire- 
merlt of COIlWpiouowmess Qpphed to a disICla:imer of warn'anty based on 
the expression "as is". 
The answer that the court gave was in tbe affirmative. The purpose 
of the law is to draw the attention of the buyer to limitations of liability 
of the seller, and tbis goal will be achieved if the statutory requlrements 
are rigidly enforeed both with respect to the "as 1S" disclaimers and the 
"merchantability" disclaimers. 
Similarly, in C 011 j :n s v. U n i l' o y a 1,18 the defendant, a tire 
manufaC'turer, was sued for the death of the buyer in an automobHe 
accident which happened aft er tbe car went out oI control when a tire 
failed. A slogan, used by the defendant to promoie the sale s of his tires, 
read as follows: "U it only saves you:c life onee, it's a bargain". However, 
the defendant attempted to limit the damages for breach of viarranty to 
refunding of the price of th
 tire Ol' replacing it. With one judge dissen- 
ting, the cou1't held that the statutory presuwpiio!1 of unconscionability 
had not been overcomeand di
 not permit the disclaimer to tak'e eifect. 
The oo111't made some inte!l'esting observations about thc cause of aetion 
for breach of warranty as compared to that 
astd on striet liability. As 
a matter of fact, both result in liabili.ty irrespective of the defendant's 
fauIt, but in cases based on strict liability the goods must be deip.ctive 
when leaving the defendant, otherwise the plaintiff cannot recover, 
wh.i1e this requirement is absent in breach of warranty situations. Thus, 
in a few states it may be more advantageou\5 for the plaintiff to claim 
breach of wartranty than to .rely on thę theory of strict liability in tort. 
In conclusion, it may be said that the developrnent of the applicability 
of warranties and the demise of the fręedom to disclaim them was one 
of the spectacular events in recent legal history. The law of products 
liabiltty oontdJnues to chaJngte anJd has not Ireach'ed as yet its final state 
of development. It may easily be predicted that those American states 


'- 


w lat So. 2d 21 (2d D.C.A., Fla. 1974). 
II Section 1-201 (lO). 
II .315 A.3d 18 (1174).
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The Warranty in American Law 


151 


which have not decided, as yet, to follow the general trend, wiU go in the 
direction of extending ever more Light
 to the consumers and limiting 
the possibility of disc1&iming warranties - protection which the law 
grants to the weaker parties of the transaction. On the other hand, with 
the increasing volume of international sales, the problem of warranty 
gains special il1'ltłOrtance in the trade between nations; experie..,ce in one 
2,risdiction ::1ay well inspiie developments in some others and the rules 
elaborated for traiIl'Sactions t!l'
ndinlg the borders of one country 
should find generał ooc,-ptaJ!1ce by the inteJ'1nationa1 community.
>>>
CONTENTS 


Foreword 3 
Janusz G 11 a s - Legal Instruments for the United States Foreign Trłide 5 
Jan G ł u c h o w s k i - Origins Range and Estimate of Oil Tax Preferences 
in the U.S. . 19 
.ran G ł u c h ow s k i, Kamila N o l' e k - The Ways and Means Committee 
of the House of Representatives in the American Congress the Tax Legis- 
lative Process 35 
Wiesław .L a n g - Debate on Law and Morality in Contemporary American 
Legal Philosophy 45 
Jan Ł o P u s k i - Foreign Sovereign Immunity and Maritime Claims 59 
Andrzej M a rek - Criminality and Its ContI:ol in Poland the datel;l, com- 
ments, and international' comparis'ons) 81 
Andrzej P u ł ł o - Some Remarks about American Federalism 99 
Sławomir R e d o - The New Criminology: the PToblem of Ętiology ol Crime 169 
Wacław S 2. Y s z k o w II k i - Some Aspects of the Dynamics of the Increasing 
Responsiveness of the US Government to the N,eeds ol the' Publi!: 123 
Wieńczysław Wag n e r - The Warranty in American Law. . 139 


ć 

, 


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