Click here to view and/or download the full Tip Sheet.
Important provisions in the Uniform Commercial Code (UCC) contain highly problematic elements that undermine Americans’ individual rights and threaten the stability of the U.S. economy. This Tip Sheet will provide a brief description of those troubling areas of the UCC and propose a set of related concrete policy solutions for lawmakers.
The UCC was created in the mid-twentieth century by the Uniform Law Commission—an influential organization of practicing lawyers, judges, legislators, legislative staff, and law professors. The ULC still frequently proposes updates and revisions to the UCC to this day, and it, along with the American Law Institute, is the driving force behind the vast majority of UCC legislative proposals. According to its website, the ULC “provides states with non-partisan, well-conceived and well-drafted legislations that brings clarity and stability to critical areas of state statutory law.”
The ULC notes that the Uniform Commercial Code “is a comprehensive set of laws governing all commercial transactions in the United States.”
The ULC further explains, “It is not a federal law, but a uniformly adopted state law. Uniformity of law is essential in this area for the interstate transaction of business. Because the UCC has been universally adopted, businesses can enter into contracts with confidence that the terms will be enforced in the same way by the courts of every American jurisdiction. … For this reason, the UCC has been called ‘the backbone of American commerce.’”
As the ULC has rightly explained, the UCC is a vital set of laws that allows for commercial activity to be conducted in a relatively cohesive manner across all 50 states. Because commercial activity and technology are always changing, it is prudent for lawmakers to occasionally update the UCC.
Unfortunately, because the UCC is dense and complicated, very few people and organizations understand it. Over the past few decades, the ULC and others have taken advantage of this confusion, by proposing changes to the UCC that few people in the public fully grasp or even learn about. Furthermore, because the ULC has a longstanding positive reputation among state legislators, policymakers frequently make changes to the UCC that have been proposed by the Uniform Law Commission without fully understanding the potential ramifications of their decisions.
Two important examples of this involve the proposed 2022 amendments to UCC Article 9—which deals with secured transactions—and past changes to UCC Article 8—which focuses on investment securities. Although many policymakers do not know it, the ULC’s 2022 proposed alterations to Article 9 would help to pave the way for a potential U.S. central bank digital currency. The amendments made to UCC Article 8, which were passed in the 1990s, have abrogated Americans’ property rights to their own securities, including those contained within retirement accounts, such as 401(k) accounts.
To read the rest of this Tip Sheet, click here.
Jack is a Senior Fellow at Our Republic. His work focuses on constitutional order, institutional governance, and the conditions necessary for effective and legitimate self-government.
His analysis examines how shifts in institutional authority affect public trust and policymaking, including congressional abdication; judicial displacement of legislative authority; delegated monetary power; the expansion of the administrative state; executive aggrandizement; the normalization of emergency powers; degradations of federalism; and extraterritorial regulatory regimes that undermine domestic accountability. His work is informed by a constitutional tradition concerned with institutional limits, accountability, and the preservation of liberty, emphasizing structural constraints on concentrated authority—wherever it resides.
He applies this analytical framework across policy domains such as technology, finance, health care, and energy, with a focus on how structural failures manifest in real-world governance challenges and how they might be addressed.
Jack writes and edits across formats, producing both long-form analysis and concise public-facing work, and regularly leads research projects from development through publication. He engages with policymakers at the federal and state levels, media professionals, and other stakeholders.
His writing has appeared in The Hill, Fox News, RealClearMarkets, and the Washington Examiner, among other outlets. He is also the coauthor of The Next Big Crash, which examines the legal and institutional foundations of the modern financial system and their implications for property rights and investor security under conditions of financial stress.
Jack also serves as a Senior Policy Analyst and Research Fellow at The Heartland Institute. He holds a master’s degree in international affairs from Loyola University Chicago and a bachelor’s degree in economics and history from Boston College.
Justin Haskins is a New York Times bestselling author and political commentator, a senior fellow and the founder of Our Republic, and a senior fellow at the Emerging Issues Center at The Heartland Institute, a national free-market think tank. (His work here does not necessarily reflect the views of The Heartland Institute.) Follow him on Twitter @JustinTHaskins.
