If you're seeing this message, it means we're having trouble loading external resources on our website. Show If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked.
McCulloch v. Maryland was the first, and probably the most important, Supreme Court decision addressing federal power. In this case, the justices held that the federal government has implied or "unenumerated" powers under Article I, Section 8 of the United States Constitution. That section is now known as the "necessary and proper" clause. The Supreme Court established that congressional power extends beyond the scope of the Constitution and that state governments cannot interfere with the federal government. In doing so, the justices defined the scope of Congressional power and clarified the relationship between state and federal government. It all started when Alexander Hamilton convinced Congress to establish a national bank. BackgroundShortly after George Washington was inaugurated as the nation's first president in 1789, his Treasury Secretary, Alexander Hamilton, proposed a plan to create a national bank. The idea was controversial from the start. Thomas Jefferson, who was Secretary of State at the time, feared having a central bank to regulate American currency would take too much power away from the states. (Fans of the hit musical Hamilton might recognize this as the conflict from "Cabinet Battle #1.") And the 1787 Constitutional Convention deliberately decided that the Constitution should not give Congress the power to create corporations. But, Congress opted to try out Hamilton's idea, creating the First Bank of the United States with a 20-year charter. Then, they let the charter lapse in 1811. However, the nation faced significant economic problems after the War of 1812, which prompted Congress to create the Second Bank of the United States in 1816. Some states passed laws to try and undermine the national bank's operations. Others, like Maryland, decided to tax it. In 1818, Maryland's state legislature passed a $15,000 annual tax on any bank operating within the state that was not charted by the state government. Only one institution fit that description - The Second Bank of the United States. James W. McCulloch, the head of the bank's Baltimore branch, refused to pay the tax. The state of Maryland argued that because the Constitution was "silent on the subject of banks," the federal government was not authorized to create one. But when the case reached the U.S. Supreme Court in 1819, the court disagreed. What Are Enumerated Powers? What Are Implied Powers?In constitutional law, we talk about government power in terms of what is specifically outlined in the Constitution and what isn't. The things the Constitution outlines for Congress to do are "enumerated" powers. Enumerated powers are also sometimes called expressed powers or explicit powers. Most of them are covered in Article I, Section 8 of the Constitution. The federal government's enumerated powers include:
But Congress has the power to do many other things, thanks to the part of the Constitution which states it can make all laws "necessary and proper" to carry out its enumerated powers. These are known as the legislature's "unenumerated" or "implied" powers. In the years that followed McCulloch, Congress used the "necessary and proper" argument to pass laws in many different areas. Later Supreme Court cases concluded that Congress's implied powers include:
Some argue this goes against the Constitution's 10th Amendment, which states that "powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." How the Supreme Court Decided McCulloch v. MarylandIn deciding McCulloch v. Maryland, the Supreme Court had two questions to answer: 1. Did Congress have the power to establish a national bank? 2. Did Maryland's law taxing the bank unconstitutionally interfere with Congress's power? Renowned attorney and orator Daniel Webster, who would later serve as Secretary of State, argued on behalf of the national bank. Writing the court's unanimous decision, Chief Justice John Marshall stated that the Constitution grants Congress the power to make "all laws necessary and proper" for carrying out the capabilities outlined in Article I, Section 8. A supporter of national government power, Chief Justice Marshall defined "necessary" to mean anything "appropriate and legitimate." This gave Congress broad authority to carry out its constitutional duties, so long as its actions were logically tied to one of its enumerated constitutional powers. Although the Constitution said nothing about the federal government establishing a bank, the court held that doing so would help Congress carry out its other duties - such as collecting taxes and maintaining armed forces. Furthermore, Marshall concluded, Article VI establishes the Constitution as the "supreme Law of the Land." Therefore, states have no power to interfere with federal law, and Maryland's tax on the national bank was unconstitutional. They reasoned that if states can tax one facet of the federal government, they can tax them all, defeating the purpose of having a federal government at all. In a now-famous portion of the decision, Justice Marshall wrote, "the power to tax is the power to destroy." The Impact of McCulloch v. MarylandThe decision in McCulloch had a profound effect on cases involving state vs. federal power. The doctrine of implied powers created by the court became a powerful tool for the federal government. The case established, once and for all, that when state and federal laws are in conflict, the federal law always wins. McCulloch also paved the way for what some call the "administrative state," a form of government that employs an extensive professional class to oversee government, the economy, and society. Essentially, the federal regulators who oversee many aspects of American life, including environmental agencies and labor regulators. Without the McCulloch decision, some of these agencies might not exist. Whether the administrative state is a good thing or not is generally a matter of political opinion. Still, there's no doubt that debate would look very different if the Supreme Court had come to a different conclusion in McCulloch. Read the Supreme Court's full opinion in McCulloch v. Maryland on FindLaw's Cases & Codes. McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819), was a landmark U.S. Supreme Court decision that defined the scope of the U.S. Congress's legislative power and how it relates to the powers of American state legislatures. The dispute in McCulloch involved the legality of the national bank and a tax that the state of Maryland imposed on it. In its ruling, the Supreme Court established firstly that the "Necessary and Proper" Clause of the U.S. Constitution gives the U.S. federal government certain implied powers that are not explicitly enumerated in the Constitution, and secondly that the American federal government is supreme over the states, and so states' ability to interfere with the federal government is restricted.[3][4] Supreme Court of the United States 4 Wheat. 316; 4 L. Ed. 579; 1819 U.S. LEXIS 320; 4 A.F.T.R. (P-H) 4491; 42 Cont. Cas. Fed. (CCH) ¶ 77,296 The state of Maryland had attempted to impede an operation by the Second Bank of the United States through a tax on all notes of banks not chartered in Maryland. Though the law, by its language, was generally applicable to all banks not chartered in Maryland, the Second Bank of the United States was the only out-of-state bank then existing in Maryland, and the law was thus recognized in the court's opinion as having specifically targeted the Bank of the United States. The Court invoked the Necessary and Proper Clause of the Constitution, which allows the federal government to pass laws not expressly provided for in the Constitution's list of enumerated powers of Congress if such laws are necessary and proper to further the powers expressly authorized.
McCulloch has been described as "the most important Supreme Court decision in American history defining the scope of Congress's powers and delineating the relationship between the federal government and the states."[5] The case established two important principles in constitutional law. First, the Constitution grants to Congress implied powers to implement the Constitution's express powers to create a functional national government. Prior to the Supreme Court's decision in McCulloch, the scope of the U.S. government's authority was unclear.[3] Second, state action may not impede valid constitutional exercises of power by the federal government.
The establishment of a national bank for the United States was a major public controversy from the moment of the U.S. Constitution's ratification in 1788.[6] Soon after George Washington's inauguration as the first President of the United States in 1789, his Secretary of the Treasury, Alexander Hamilton, proposed creating a national bank to regulate American currency and deal with national economic problems.[6] But Washington's Secretary of State, Thomas Jefferson, strongly opposed the bank's creation, fearing that it would usurp power from the individual states and concentrate it to a dangerous degree in the central federal government.[6] Congress created the First Bank of the United States in 1791 with a 20-year charter, but the issue continued to be controversial. Those who supported Hamilton's vision of a stronger central government eventually formed the Federalist Party, while those who opposed him and supported Jefferson's vision of a decentralized government that focused on states' rights formed the Democratic-Republican Party. The First Bank's charter expired in 1811 and was not renewed. However, national economic problems in the aftermath of the War of 1812 prompted Congress to pass similar legislation in 1816 to create the Second Bank of the United States.[7] The U.S. government only owned 20 percent of the bank's equity, and many state governments resented the bank for calling in loans it had made to them.[7] Consequently, some states passed laws designed to hinder the bank's operation, while others simply tried to tax it.[7] In 1818, the Maryland General Assembly—Maryland's state legislature—passed a law levying a $15,000 annual tax on any bank operating in Maryland that were issuing notes and bills that were not properly stamped by the Maryland's Treasury, the Western Shore Treasury.[8] James William McCulloch, a cashier of the Baltimore Branch of the Second Bank of the United States, issued unstamped bank notes to Baltimore resident George Williams.[9] The lawsuit was filed by John James, an informer who sought to collect half of the fine, as provided for by the statute.[8] The Bank was represented by Daniel Webster. The case was appealed to the Maryland Court of Appeals, where the state of Maryland argued that "the Constitution is silent on the subject of banks." It was Maryland's contention that without specific constitutional authorization for the federal government to create a bank, any such creation would be rendered unconstitutional. The court upheld Maryland. The case was then appealed to the Supreme Court. The text of the McCulloch v. Maryland decision, as recorded in the minutes of the Supreme Court The Court determined that Congress had the power to create the Bank. Chief Justice Marshall supported his conclusion with four main arguments:[10] Firstly, he argued that historical practice established Congress's power to create the bank. Marshall invoked the creation of the First Bank of the United States in 1791 as authority for the constitutionality of the second bank.[10] The first Congress had enacted the bank after great debate, and it was approved by an executive "with as much persevering talent as any measure has ever experienced, and being supported by arguments which convinced minds as pure and as intelligent as this country can boast."[11] Secondly, Marshall rebutted the argument that states retain ultimate sovereignty because they ratified the constitution: "The powers of the general government, it has been said, are delegated by the states, who alone are truly sovereign; and must be exercised in subordination to the states, who alone possess supreme dominion."[12] Marshall contended that it was the people who ratified the Constitution and thus the people, not the states, who are sovereign.[10] Thirdly, Marshall addressed the scope of congressional powers under Article I. The Court broadly described Congress's authority before it addressed the Necessary and Proper Clause.[10] Marshall admitted that the Constitution does not enumerate a power to create a central Bank but said that is not dispositive as to Congress's power to establish such an institution:[10] "In considering this question, then, we must never forget, that it is a constitution we are expounding."[13] Fourthly, Marshall supported his opinion textually by invoking the Necessary and Proper Clause, which permits Congress to seek an objective while it exercised its enumerated powers as long as that objective is not forbidden by the Constitution. In liberally interpreting the Necessary and Proper Clause, the Court rejected Maryland's narrow interpretation of the clause that the word "necessary" in the clause meant that Congress could pass only laws that were absolutely essential in the execution of its enumerated powers. The Court rejected that argument, on the grounds that many of the enumerated powers of Congress under the Constitution would be useless if only laws deemed essential to a power's execution could be passed. Marshall also noted that the Necessary and Proper Clause is listed within the powers of Congress, not its limitations. The Court held that the word "necessary" in the Necessary and Proper Clause does not refer therefore to the only way of doing something but applies to various procedures for implementing all constitutionally-established powers: "Let the end be legitimate, let it be within the scope of the Constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the Constitution, are Constitutional."[14] That principle had been established many years earlier by Alexander Hamilton:[15]
Chief Justice Marshall also determined that Maryland could not tax the bank without violating the constitution since, as Marshall commented, "the power to tax involves the power to destroy". The Court thus struck down the tax as an unconstitutional attempt by a state to interfere with a federal institution, in violation of the Supremacy Clause.[16] The opinion stated that Congress has implied powers, which must be related to the text of the Constitution but do not need to be enumerated within the text. The case was a seminal moment in federalism: the formation of a balance between federal powers and state powers. Marshall also explained in the case that the Necessary and Proper Clause does not require all federal laws to be necessary and proper and that federal laws that are enacted directly pursuant to one of the expressed, enumerated powers granted by the Constitution do not need to comply with the Necessary and Proper Clause, which "purport[s] to enlarge, not to diminish the powers vested in the government. It purports to be an additional power, not a restriction on those already granted." Though Marshall rejected the Tenth Amendment's provision of states' rights arguing that it did not include the word "expressly," unlike the Articles of Confederation, which the Constitution replaced,[17] controversy over the authority of the amendment being violated by the decision has existed. Compact theory also argues that the federal government is a creation of the states and that the states maintain superiority. Unlike Marshall, his successor, Roger B. Taney, established dual federalism by which separate-but-equal branches of government are believed to be a better option.[18] McCulloch v. Maryland was cited in the first substantial constitutional case presented before the High Court of Australia in D'Emden v Pedder (1904), which dealt with similar issues in the Australian Federation. While recognizing American law as not binding on them, the Australian Court nevertheless determined that the McCulloch decision provided the best guideline for the relationship between the Commonwealth federal government, and the Australian States, owing in large part to strong similarities between the American and Australian constitutions.
|
In mcculloch v. maryland, what did the state of maryland argue?
Related Posts
Copyright © 2024 SignalDuo Inc.
