RICHARD A. LYNG, SECRETARY OF AGRICULTURE, APPELLANT V. INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, UAW, ET AL. No. 86-1471 In the Supreme Court of the United States October Term, 1987 On Appeal for the United States District Court for the District of Columbia Reply Brief for the Appellant TABLE OF CONTENTS A. Section 2015(d)(3) has a Rational Basis B. Section 2015(d)(3) Does Not Abridge First Amendment Rights of Association or Expression Conclusion In our opening brief, we demonstrated that Section 2015(d)(3) of the Food Stamp Act of 1964 (7 U.S.C.) is rationally related to three legitimate legislative objectives: (1) reducing the costs of the Food Stamp program, as part of an integrated effort to trim the federal deficit; (2) tying the receipt of food stamps to the ability and willingness to work, thereby channeling scarce resources to those least able to provide the means for self-support; and (3) achieving a greater measure of government neutrality in labor disputes. In response, appellees acknowledge (Br. 18-19 n.12) that rationality is the benchmark but, applying that standard (id. at 17-37), find the statute wanting. Moreover, while appellees agree (id. at 44) that Section 2015(d)(3) "does not directly prevent" them from exercising First Amendment rights, they assert that the statute "effectively penalizes (their) associational rights" (Br. 39) and "impermissibly burdens" their rights of free expression (id. at 44). A. Section 2015(d)3) has a Rational Basis 1. Appellees' quarrel with Section 2015(d)(3) may stem, in some measure, from their apparent misapprehension about its actual meaning and application. At every turn, appellees describe the statute as if it disqualified households containing strikers from any and all participation in the Food Stamp program. As appellees put it, Section 2015(d)(3) imposes a "per se disqualification of strikers and their households from food stamps" (Br. 1) and "prohibits the participation in the food stamp program of an entire household which contains a member on strike" (id. at 6-7). See also id. at 14, 20; ACLU Amicus Br. 2, 6. Section 2015(d)(3) does not, however, disqualify households containing strikers from the Food Stamp program. A household that is eligible to receive food stamps prior to a striker does not lose its eligibility once the strike begins; it simply cannot receive additional coupons on account of the loss of income occasioned by the strike itself. And a household that includes a person who goes on strike is not permanently precluded from receiving food stamps; the preclusion lasts only as long as that person is on strike. 2. Appellees find none of the three purposes served by Section 2015(d)(3) sufficient to give the statute a rational grounding. They first dispute the rationality of Section 2015(d)(3) as a cost-cutting measure. In appellees' view, "a legislative classification directing welfare benefits cannot be justified by a mere showing that the classification will reduce expenditures" (Br. 19). But Section 2015(d)(3) was not designed "mere(ly)" to achieve a savings in revenue. The statute sought to save money, to be sure, but only in a manner that channelled the remaining, limited funds to persons whom Congress believed were generally less able than strikers to provide the means of self-support. There is nothing irrational about that goal, as this Court confirmed last Term in Bowen v. Gilliard, No. 86-509 (June 25, 1987). In the Gilliard case, decided shortly after our opening brief was filed, plaintiffs challenged a statute that required households filing for AFDC benefits to treat as members of the household all children living in the same home, including those children for whom support payments were being received. In many cases, the net result of that provision -- when coupled with a second provision requiring that all but $50 of the support payment be assigned to the State -- was sharply to reduce the total funds available to the household. The Court held that the statute had a rational purpose, in that it "unquestionably serves Congress' goal of decreasing federal expenditures" (slip op. 11). And while the statute "severely impact(ed) some families," that did "not alter the fact that the entire program has resulted in saving huge sums of money" (ibid.). The Court found that the interest in savings was "also supported by the Government's separate interest in distributing benefits among competing needy families in a fair way." In particular, "(g)iven its perceived need to make cuts in the AFDC budget, Congress obviously sought to identify a group that would suffer less than others as a result of a reduction in benefits." Id. at 11-12. /1/ As in the Gilliard case, Congress resolved to make sizeable budget cuts in the Food Stamp program (among others), and it structured those cuts so as to channel available resources to those persons whom it thought were least able to support themselves. Appellees dispute that judgment on various empirical grounds. /2/ They assert (Br. 21), for example, that households containing strikers are generally as needy as households that do not contain strikers. But Congress thought otherwise, concluding that strikers at least have a job waiting for them which, for economic or other reasons, they have chosen not to perform. Appellees also dispute (id. at 22) "(t)he unstated but implicit premise in this argument * * * that strikers have voluntarily left work and can return * * * at any time during a strike." That premise is mistaken, they argue, because "in many instances" a stuck employer will close his plant; "(i)n an additional minority of situations, the employer will permanently replace its striking workers"; /3/ and not every striker will have voted in favor of the strike (id. at 22-23). It is plain, however, that "(i)n determining how best to allocate limited funds among the extremely large class of needy families" eligible for food stamps, "Congress is entitled to rely on (the) class-wide presumption" that striking workers have made a significantly voluntary decision to begin a strike and remain on strike. Bowen v. Gilliard, slip op. 13. See also Baker v. General Motors Corp., No. 85-117 (July 2, 1986), slip op. 16. 3. Appellees also contend (Br. 23-25) that Section 2015(d)(3) is an irrational way to tie the receipt of food stamps to the ability and willingness to work, pointing to the somewhat more favorable treatment of voluntary quiters under the Food Stamp Act. That argument is flawed in two respects. /4/ First, Congress could well have believed that in some respects a voluntary quitter is worse off than a person who is on strike, and accordingly should receive more generous treatment under the Food Stamp Act. As one court has observed (Ledesma v. Block, No. G82-94 (W.D. Mich. Aug. 26, 1985), slip op. 9, aff'd, 825 F.2d 1046 (6th Cir. 1987)): (T)he striker's separation from employment is temporary rather than permanent. Strikers can return to work simply by terminating the strike. A voluntary quit generally cannot unilaterally decide to return to his previous employment. Therefore, after a statutory period of 90 days, the government no longer considers one who quit his job to be, quote, "voluntarily unemployed". The same just cannot be said for an individual on strike. /5/ Second, appellees overlook the fact that Congress sought not only to tie food stamps to the willingness to work, but to do so in a way that promoted governmental neutrality in labor disputes. Congress could well have concluded that by extending food stamps to the households of voluntary quitters -- unlike the households of strikers -- it would not be choosing sides in a strike and thereby prolonging, and perhaps exacerbating, the work stoppage. See Comment, Welfare for Strikers: ITT v. Minter, 39 U. Chi. L. Rev. 79, 101-106 (1971). 4. a. Appellees dispute the goal of labor neutrality because it allegedly "import(s) * * * an extraneous factor into the eligibility criteria for an otherwise need-based program" (Br. 28). We agree that the Food Stamp Act is generally intended to "permit low-income households to obtain a more nutritious diet" (7 U.S.C. 2011). But that is surely not the only goal that Congress is constitutionally entitled to pursue within the ambit of the Food Stamp Act. Indeed, this Court expressly recognized in United States Dep't of Agriculture v. Moreno, 413 U.S. 528 (1973), that an amendment to the Food Stamp Act may be sustained if it "rationally further(s) some legitimate governmental interest other than those specifically stated in the congressional 'declaration of policy'" (413 U.S. at 534). b. Appellees also quarrel with the goal of labor neutrality because "(n)o similar disqualification from otherwise available benefits is made for the employer whose employees find it necessary to strike" (Br. 30). They seem to suggest that Congress cannot withhold benefits from striking workers unless it first enacts separate Tax and Bankruptcy Codes that treat management more harshly when its employees are on strike. As the Court has repeatedly stated, however, "in addressing complex problems a legislature 'may take one step at a time, addressing itself to the phase of the problem which seems most acute to the legislative mind'" (Bowen v. Owens, No. 84-1905 (May 19, 1986), slip op. 7 (quoting Williamson v. Lee Optical Co., 348 U.S. 483, 489 (1955)). See also Lyng v. Castillo, No. 85-250 (June 27, 1986), slip op. 8. Certainly Congress is free to promote additional neutrality, even if it is unable or unwilling to enact complete neutrality. /6/ c. Finally, appellees contend (Br. 27-31) that this Court's articulation of the goal of governmental neutrality in Ohio Bd. of Employment Servs. v. Hodory, 431 U.S. 471 (1977), is inapplicable in this case. In their view, neutrality was a rational goal in Hodory because unemployment compensation, unlike food stamps, is financed with "employer payroll tax contributions," and thus "(t)he employer's costs go up with every laid-off worker who is qualified to collect unemployment'" (Br. 28 (quoting Hodory, 431 U.S. at 492)). It is true that in the case of unemployment compensation, employers would indirectly finance part of the benefits through higher insurance premiums. But the Court nowhere suggested in Hodory that governmental neutrality is only a permissible goal where the employer bears such a double cost. In the present case, Congress determined that providing food stamps to striking workers could "be seen as encouragement to workers to 'wait out' management rather than compromise." S. Rep. 97-139, 97th Cong., 1st Sess. 62 (1981). The government is entitled to promote neutrality even where the failure to remain neutral imposes fewer costs on employers than unemployment compensation. Appellees also contend that Hodory is inapplicable because food stamps, unlike unemployment compensation, are given only to households that meet financial eligibility requirements (Br. 28), and because they "ha(ve) a dramatically reduced effect upon both employers and strikers as compared to the case of unemployment insurance benefits" (id. at 28-29). Neither of those factors, however, had any bearing on the Court's recognition in the Hodory case that the government is entitled to promote neutrality in lbaor disputes. /7/ 5. Recognizing that Congress acted rationally in enacting Section 2015(d)(3), two lower federal courts have rejected identical constitutional challenges to the statute, in decisions rendered since the filing of our opening brief. a. According to the Sixth Circuit in Ledesma v. Block, 825 F.2d 1046 (1987), aff'g No. G82-94 (W.D. Mich. Aug. 26-1985), "the difficult task of allocating scarce resources was foremost in the minds of the (Senate) Committee()" when it adopted Section 2015(d)(3) (825 F.2d at 1048). Congress recognized that "social and value judgments would inevitably have to be made as between programs and within the programs themselves" (ibid.), and the court of appeals found those judgments to be entirely rational. It rejected (id. at 1051) as merely a "social argument()" the claim that Section 2015(d)(3) is not genuinely neutral because the government has not imposed offsetting penalties on management. /8/ The court also found that Section 2015(d)(3) rationally promotes the goal of "concentrating benefits on people who are unable to work" (825 F.2d at 1052). b. The district court in Eaton v. Lyng, No. C 87-4073 (N.D. Iowa June 29, 1987), appeal pending, No. 87-819 (8th Cir.), also found Section 2015(d)(3) to be eminently rational. Explicitly rejecting the heightened scrutiny standard applied in the present case (slip op. 14), /9/ the court explained (id. at 14-16) that neither "the historical mistreatment of strikers" nor the fact that the "onus" of the law falls on "innocent members of (the) family" justifies a departure from the rational-basis test. /10/ Applying that standard, the court agreed that Section 2015(d)(3) promotes governmental neutrality in labor disputes. "(W)ithout the amendment, the balance could tip decidedly in labor's favor, because only labor would receive a tangible and individualized form of compensation which is so effective in counteracting the effects of a strike. No comparable safety net for management is presently in place." Slip op. 18. The court rejected (id. at 17) plaintiffs' claim that the government cannot be neutral if it does not impose special tax and bankruptcy rules on management. "The proper question is whether progress toward that goal is rationally furthered" by the statute (ibid.). The court agreed that it was. /11/ B. Section 2015(d)(3) Does not Abridge First Amendment Rights of Association or Expression 1. Appellees' First Amendment challenge to Section 2015(d)(3) rests, first and foremost, on a significant exaggeration about the impact of the statute. Throughout their brief, appellees depict Section 2015(d)(3) as if it made persons ineligible for food stamps because they exercised any of a vast array of First Amendment rights. As they put it, the statute "penalizes those exercising associational rights" (Br. 16) and "punishes individuals and their families for the exercise of the statutorily protected right to strike and its related constitutionally protected rights" (id at 39-40). In fact, of course, Section 2015(d)(3) does nothing of the sort. Households do not become ineligible for food stamps because their members associate with a union, or express union sentiments, or picket the premises of an employer. Cf. Thornhill v. Alabama, 310 U.S. 88 (1940). Only the act of striking brings Section 2015(d)(3) into play -- an act that even appellees concede has received only "circumspect" protection under the First Amendment (Br. 38 n.23). See Dorchy v. Kansas, 272 U.S. 306, 311 (1926). Appellees nevertheless defend a broad constitutional right to strike as an aspect of "associational freedom()" (Br. 39). They note that "(a) strike cannot occur as an individual activity" and suggest that the right to strike must be constitutionally protected because it is "undertaken to further the goals of union members associated together as an organization" (id. at 38-39). Appellees ignore the fact that the "right to strike" does not exist in a regulatory vacuum, but must instead be understood against an elaborate body of statutory and decisional law that shapes and gives content to that right. Congress has historically sought to forge an appropriate balance between the right to strike and the social costs that strikes entail. In finding that balance Congress has, at different times, both expanded (see, e.g., Norris-La Guardia Act, 29 U.S.C. 104; Order of R.R. Tel. v. Chicago & N.W. Ry., 362 U.S. 330 (1960)), and contracted (see, e.g., Railway Labor Act, 45 U.S.C. 151-188; Brotherhood of R.R. Trainmen v. Chicago R. & I. R.R., 353 U.S. 30 (1957); and Section 301(a) of the Labor-Management Relations Act, 1947, 29 U.S.C. 185(a); Boys Mkts., Inc, v. Retail Clerks' Local 770, 398 U.S. 235 (1970)), the right to strike. The decision of Congress to qualify the eligibility of striking workers to obtain food stamps was thus one in a long series of legislative judgments about the appropriate balance of rights and obligations in a pervasively regulated area of conduct. Cf. Donovan v. Dewey, 452 U.S. 594, 603 (1981); United States v. Biswell, 406 U.S. 311, 316 (1972); Colonnade Catering Corp. v. United States, 397 U.S. 72, 74, 77 (1970). Given this regulatory backdrop, it is simply untenable to claim that a union's freedom to associate entitles it to act -- free from regulation -- simply because that act is in the union's self-interest. This Court made that very point in Lincoln Federal Labor Union v. Northwestern Iron & Metal Co., 335 U.S. 525 (1949). The Lincoln Federal case involved the constitutionality of state laws that prohibited employers from denying employment to persons on the ground that they were, or were not, members of a labor organization. The union plaintiffs contended that the laws "abridge(d) the freedom of speech and the opportunities of unions and their members 'peaceably to assemble, and to petition the Government for a redress of grievances'" (335 U.S. at 529). Like appellees in the present case, the plaintiffs in Lincoln Federal conceded that the laws in question did not "expressly forbid the full exercise of those rights by unions or union members" (id. at 530). They asserted, nevertheless, that the laws "indirectly infringe(d) their constitutional rights of speech, assembly, and petition" because "(t)he right of unions and union members to demand that no non-union members work along with union members is 'indispensable to the right of self-organization and the association of workers into unions'" (ibid.). This Court found it "unnecessary to elaborate the numerous reasons for (its) rejection of this contention" (id. at 531). In language equally dispositive of appellees' claim in the present case, the Court explained that the right to free association does not include everything that the association believes to be in it self-interest (ibid.): The constitutional right of workers to assemble, to discuss and formulate plans for furthering their own self interest in jobs cannot be construed as a constitutional guarantee that none shall get and hold jobs except those who will join in the assembly's plans. For where conduct affects the interests of other individuals and the general public, the legality of that conduct must be measured by whether the conduct conforms to valid law, even though the conduct is engaged in pursuant to plans of an assembly. The Court applied the same principle in International Union, UAW v. Wisconsin Employment Reglations Bd., 336 U.S. 245 (1949), a case explicitly involving the right to strike. At issue was a state statute that prohibited employees from engaging in intermittent and unannounced work stoppages in an effort to secure bargaining advantages. The union plaintiff contended that the statute violated rights of free speech and assembly, but this Court rejected that claim. Citing Lincoln Federal, the Court tersely explained that "(f)or (the) reasons there stated, these contentions are without merit" (336 U.S. at 251-252). Appellees are thus manifestly mistaken when they place the right to strike "at the very core of the First Amendment" and cloak it with a "'constitutionally imposed "governmental obligation of neutrality"'" (Br. 45 (citation omitted)). "(P)rotected 'union activities' include advocacy and persuasion in organizing the union and enlarging its membership, and also in the expression of its views to employees and to the public. * * * It does not follow, however, that all activities of a union or its members are constitutionally protected." Hanover Township Fed'n of Teachers Local 1954 v. Hanover Community School Corp., 457 F.2d 456, 460 (7th Cir. 1972) (Stevens, J.) (footnote omitted). See also United Fed'n of Postal Clerks v. Blount, 325 F. Supp. 879 (D.D.C.), aff'd mem., 404 U.S. 802 (1971); Ledesma v. Block, 825 F.2d at 1050. Cf. 5 U.S.C. 7311(3) (no right to strike against the United States Government); 18 U.S.C. 1918 (criminal penalty for violation of 5 U.S.C. 7311). As Justice Jackson explained in the UAW case, "(t)he right to strike, because of its more serious impact upon the public interest, is more vulnerable to regulation than the right to organize and select representatives for lawful purposes of collective bargaining which this court has characterized as a 'fundamental right'" (336 U.S. at 259). The right to strike accordingly does not enjoy the protection under the Constitution that appellees surmise. /12/ 2. But even if the right to strike were entitled to more robust protection under the First Amendment, appellees' challenge to Section 2015(d)(3) is nonetheless meritless, because the statute simply does not prohibit union or family members from exercising First Amendment rights. Indeed, Section 2015(d)(3) does not prohibit anything; it simply refuses to offset a loss of income occasioned by the decision to participate in a strike. Even if a worker's loss of income would impair his capacity to exercise protected rights, the government's decision not to replace that income does not constitute a deprivation of constitutional rights. Put another way, "federal law protects the employees' right to authorize * * * a strike; it is equally clear, however, that federal law does not prohibit the (government) from deciding whether or not to compensate the employees who thereby cause their own unemployment" (Baker v. General Motors Corp., No. 85-117 (July 2, 1986), slip op. 16). /13/ Appellees insist, however, that their rights of association and expression must be free even from "'more subtle governmental interference'" (Br. 41 (citation omitted)) and not simply from governmental action that "prohibits" or "directly interferes" with a constitutional right. The Court rejected the same claim in Bowen v. Gilliard, supra. In the Gilliard case, plaintiffs contended that heightened scrutiny was appropriate because the AFDC amendment interfered with the free association rights of families. As in the present case, the plaintiffs offered evidence of family members who had left their households because of the decrease in federal payments. The Court held, however, that incentives of that sort "are the unintended consequences of many social welfare programs, and do not call the legitimacy of the programs into question" (slip op. 14 n.17). As the Court put it, "(t)hat some families may decide to modify their living arrangements in order to avoid the effect of the amendment, does not transform the amendment into an act whose design and direct effect is to 'intrud(e) on choices concerning family living arrangements'" (id. at 14, quoting Moore v. East Cleveland, 431 U.S. 494, 499 (1977)). Appellees' First Amendment challenge to Section 2015(d)(3) fails for precisely the same reason. As the district court in Eaton v. Lyng explained when it upheld the statute as constitutional (slip op. 13), Section 2015(d)(3) "does not create obstacles to the plaintiffs' exercise of their constitutional rights to free association and free speech." Rather, the pressure to leave a strike, to resign from a union, or to dissociate from a family "is created by the strike, and Congress has simply refused to use the food stamp program to solve the problem" (slip op. 10). See also Ledesma v. Block, 825 F.2d at 1051. CONCLUSION At bottom, appellees' challenge to Section 2015(d)(3) is addressed to the wisdom of the policy choices that Congress made. Appellees object to "harsh treatment of strikers and their households" (Br. 23) and point out examples that illustrate the impact of the statute on family life and on union activity (id. at 7-11). In their view, moreover, "the small percentage of striker households" participating in the Food Stamp program "hardly justif(ied) the sweeping disqualification imposed in 1981" (id. at 20-21 n.13). But as this Court stated in the Gilliard case last Term, such individual hardships are the inevitable by-product "of a decision to reduce or to modify benefits to a class of needy recipients. Under our structure of government, however, it is the function of Congress -- not the courts -- to determine whether the savings realized, and presumably used for other critical governmental functions, are significant enough to justify the costs to the individuals affected by such reductions." Bowen v. Gilliard, slip op. 9. In the present case, Congress debated the propriety of affording food stamps to households of striking workers for more than a decade (Gov't Br. 4-11). Strong views were presented on both sides, and Congress considered the problem from all angles. Although Congress recognized the costs that Section 2015(d)(3) might impose on the households of striking workers, it ultimately determined that those costs were outweighed by the surpassing importance of reducing budget costs, tying benefits to the ability and willingness to work, and promoting government neutrality in labor disputes. Because that judgment is plainly rational, and because it offends no constitutionally protected rights, appellees' challenge to Section 2015(d)(3) must fail. The judgment of the district court should be reversed. Respectfully submitted. CHARLES FRIED Solicitor General NOVEMBER 1987 /1/ Appellees refer to Gilliard only in passing (see Br. 35 n.19), purporting to distinguish the case because there, unlike here, Congress enacted a statute that was "reasonably related to the task of assessing financial need." But in enacting Section 2015(d)(3), Congress made a similiar "assess(ment) (of) financial need": it concluded -- reasonably, we believe -- that households containing a striking member are generally better off than households whose members have no job prospects at all. /2/ As the Court has explained in rejecting a similiar claim in an equal protection case, the question is not "which party has shown that a disputed historical fact is more likely than not to be true." Rather, "those challenging the legislative judgment must convince the court that the legislative facts on which the classification is apparently based could not reasonably be conceived to be true by the governmental decisionmaker." Vance v. Bradley, 440 U.S. 93, 110-111 (1979). /3/ As the district court observed (J.S. App. 47a n.4) and as appellees acknowledge (Br. 11 n.10), it is the Secretary's policy not to make households ineligible for food stamps where strikers have been permanently replaced by their employers. Section 2015(d)(3) is not unconstitutional simply because that policy may not have been followed in certain cases. See Bowen v. Gilliard, slip op. 11 (rationality of AFDC amendments is not undermined by "evidence that a few noncustodial parents were willing to violate the law by not making court-ordered support payments"). /4/ Appellees also find Section 2015(d)(3) discriminatory because it requires strikers, but not non-strikers, to cross a picket line in order to become eligible for food stamps (Br. 15, 23). But surely Congress could rationally have concluded that (1) it is more likely that those workers who actually go out on strike are voluntarily unemployed; and (2) providing food stamps to non-strikers does not significantly jeopardize governmental neutrality in labor disputes. /5/ In this essential respect, the two workers hypothesized by the ACLU (Amicus Br. 11) are differently situated for purposes of food stamp benefits. /6/ The ACLU discerns "impermissible animus" (Amicus Br. 8) and an intent "to tip the balance of power in labor relations in favor of management" (id. at 12-13) in the fact that Congress withheld food stamps from strikers, without imposing offsetting penalties on management. Its evidence of animus, however, is drawn entirely from comments made by opponents about precursors of the statute. See Ernst & Ernst v. Hochfelder, 425 U.S. 185, 203-204 n.24 (1976); NLRB v. Fruit Packers, 377 U.S. 58, 66 (1964). By contrast, in the Moreno case this Court relied on statements made by the proponents of the legislation for its determination that the legislation was tainted by an impermissible animus against hippies. See 413 U.S. at 534 (citing 116 Cong. Rec. 44439 (1970) (Sen. Holland)). See ibid. (Sen. Holland) (endorsing exclusion of "'hippy' communes" as "a good provision"). /7/ Appellees claim (Br. 37 n.22) that we "misleadingly" referred the Court to two cases that, like Hodory, refused to apply strict scrutiny to statutes that denied government benefits to strikers. They assert, first, that when the court in Russo v. Kirby, 453 F.2d 548 (2d Cir. 1971), rejected the strikers' First Amendment claims as "frivolous," it did so only "in dicta." That is simply not so. The issue in Russo was whether the district court had jurisdiction to enjoin the refusal of the State of New York to provide welfare benefits to striking workers. The court of appeals held that there was no jurisdiction and accordingly set aside the lower court's injunction. In reaching that result, the court found that "(n)o colorable constitutional claim is presented to justify taking jurisdiction under Section 1343. The argument that denying welfare benefits to strikers infringes their first amendments rights borders on the frivolous." 453 F.2d at 551. Plainly, that was a holding essential to the dispostion on the merits. And that holding is not in the slightest impeached by the fact that "the plaintiffs in Russo eventually prevailed in state court and the benefits at issue were reinstated" (Br. 37 n.22). The state courts simply held that under state law the Commissioner of the Department of Social Services was entitled to provide welfare benefits to strikers. See Lascaris v. Wyman, 31 N.Y.2d 386, 292 N.E.2d 667, 340 N.Y.S.2d 397 (1972). The state courts did not even advert to any constitutional issues. Finally, it was not "in dicta" (Br. 37 n.22) that the three-judge court in Francis v. Davidson, 340 F. Supp. 351 (D. Md.), aff'd mem., 409 U.S. 904 (1972), rejected the equal protection challenge to a state's denial of AFDC benefits to children whose fathers were on strike. The court squarely decided that claim, but resolved the case in plaintiff's favor on other grounds. /8/ The court observed (825 F.2d at 1051-1052) that, in any event, Section 2015(d)(3) does not uniformly disfavor unions. It noted that the statute permits households to collect food stamps if they were eligible to do so before the strike began. And it pointed out that the statute does not require non-strikers to assist management by crossing a picket line in order to collect benefits. /9/ Appellees find it "difficult to fathom" why we have characterized the district court's decision in the present case as an application of heightened scrutiny (Br. 18 n. 12). We note, however, that the district court in the Eaton case read the case in the same way. See slip op. 14. See also Ledesma v. Block, 825 F.2d at 1052 ("(t)he main difference between (the UAW decision) and ours it the standard of constitutional review"). /10/ The court stated (slip op. 15 (emphasis in the original)) that the ability of unions to secure favorable legislative treatment "should have been a compelling reason not to adopt a heightened degree of judicial scrutiny." It also found the district court's reliance in the present case on Plyler v. Doe, 457 U.S. 202 (1982), unwarranted (id. at 15-16), noting that Section 2015(d)(3) does not present the "extreme circumstances" involved in Plyler (slip op. 15). Appellees believe otherwise, claiming that "(t)he activities of strikers, as a rule, are lawful and unquestionably more protected than those of the undocumented workers in Plyer" (Br. 33). As we show below, however (pages 11-14, infra), the right to strike does not enjoy the level of constitutional protection that appellees suppose, nor is it a right, like education, whose denial "imposes a lifetime hardship" and a "stigma of illiteracy (that) will mark (the children) for the rest of their lives" (Plyler, 457 U.S. at 223). /11/ The court also found that the interest in government neutrality furnished a "rational basis for treating strikers differently from those who quit and those who attempt to defraud the system" (Eaton, slip op. 18). /12/ A labor dispute that results in a strike is preeminently "a business transaction in which speech is an essential but subordinate component," and "(w)hile this does not remove the speech from the protection of the First Amendment, * * * it lowers the level of appropriate judicial scrutiny" (Ohralik v. Ohio State Bar Ass'n, 436 U.S. 447, 457 (1978)). See also Roberts v. United States Jaycees, 468 U.S. 609, 637-638 (1984) (emphasis in the original; citation omitted) (O'Connor, J., concurring in part and concurring in the judgment) (consistent with the First Amendment, "(a) State is free to impose rational regulation of the membership of a labor union representing 'the general business needs of employees'"). /13/ As we noted in our opening brief (Br. 23-24), this Court's decision in Harris v. McRae, 448 U.S. 297 (1980), sharply distinguished the denial of constitutional rights from the simple failure to fund the exercise to those rights. Appellees contend that the Harris case does not apply because "(t)he constitutional freedoms at issue here, unlike the right to choose an abortion, are not lightly subjected to regulation" (Br. 45). But as we noted above, the right to strike -- unlike other aspects of the right to free association -- is constitutionally susceptible to considerable governmental regulation. See pages 11-14, supra. In any event; the Court in Harris did not predicate its distinction -- between refusals to fund and outright denials -- on the nature of the constitutional right at stake. That point is confirmed by Buckley v. Valeo, 424 U.S. 1, 94-95 (1976), in which the Court applied the same distinction, even though the case involved the claim that the failure to fund offended a "'constitutionally imposed "governmental obligation of neutrality"'" (Br. 45 (citations omitted)). Appellees also distinguish Harris on the ground that the plaintiffs in that case, unlike those here, "were not disqualified from benefits altogether because they had chosen to exercise a constitutionally protected right" (Br. 46). See also ACLU Amicus Br. 23. But Section 2015(d)(3) does not "disqualif(y) altogether" households that contain a member who is on strike. Households may, for example, continue to receive food stamps if they were eligible to receive them before the strike began, and they lose their eligibility only so long as a member of the household is on strike. Like the Hyde Amendment in Harris, therefore, Section 2015(d)(3) "represents simply a refusal to subsidize certain protected conduct" (448 U.S. at 317 n.19).