McCulloch v. Maryland

The citation for this case is 17 [4 Wheat] US 316. This 1819 case is a landmark decision. It was argued from 22 February to 3 March 1819 and decided on 6 March 1819 on a 7-0 vote. In one of the most important decisions in the Supreme Court’s history, Chief Justice John Marshall’s ruling “settled the meaning of the Necessary and Proper Clause of the United States Constitution and determined the distribution of powers between the federal government and the states. The specific issues involved were Congress’s power to incorporate the Second Bank of the United States and the right of a state to tax an instrument of the federal government.” [Richard E. Ellis, “McCulloch v. Maryland,” in Kermit L. Hall, ed., The Oxford Guide to United States Supreme Court Decisions, p. 182]

In 1816, Congress chartered the Second National Bank of the United States with branches in several states, including Maryland. Viewing the bank’s chartering as unconstitutional, many states, including Maryland, adopted laws taxing the bank branches. The head of the Baltimore, Maryland branch, James McCulloch, refused to pay the tax. The Maryland courts all upheld the tax and the case went to the Supreme Court.

There is a great deal of instruction available on this case. In particular are these videos:

A short primer on the case:

 

And a two-part video on the case:

The decision is a long one with different aspects to it, but I want to focus on the relation between the Federal Government and the states.

First, Marshall discusses whether the Constitution is a creation of the states or of the People: “In discussing this question, the counsel for the state of Maryland have deemed it of some importance, in the construction of the constitution, to consider that instrument, not as emanating from the people, but as the act of sovereign and independent states. 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.  It would be difficult to sustain this proposition. The convention which framed the constitution was indeed elected by the state legislatures. But the instrument, when it came from their hands, was a mere proposal, without obligation, or pretensions to it. It was reported to the then existing congress of the United States, with a request that it might ‘be submitted to a convention of delegates, chosen in each state by the people thereof, under the recommendation of its legislature, for their assent and ratification.’ This mode of proceeding was adopted; and by the convention, by congress, and by the state legislatures, the instrument was submitted to the people. They acted upon it in the only manner in which they can act safely, effectively and wisely, on such a subject, by assembling in convention. It is true, they assembled in their several states-and where else should they have assembled? No political dreamer was ever wild enough to think of breaking down the lines which separate the states, and of compounding the American people into one common mass. Of consequence, when they act, they act in their states. But the measures they adopt do not, on that account, cease to be the measures of the people themselves, or become the measures of the state governments. From these conventions, the constitution derives its whole authority. The government proceeds directly from the people; is ‘ordained and established,’ in the name of the people; and is declared to be ordained, ‘in order to form a more perfect union, establish justice, insure domestic tranquillity, and secure the blessings of liberty to themselves and to their posterity.’ The assent of the states, in their sovereign capacity, is implied, in calling a convention, and thus submitting that instrument to the people. But the people were at perfect liberty to accept or reject it; and their act was final. It required not the affirmance, and could not be negatived, by the state governments. The constitution, when thus adopted, was of complete obligation, and bound the state sovereignties. It has been said, that the people had already surrendered all their powers to the state sovereignties, and had nothing more to give. But, surely, the question whether they may resume and modify the powers granted to government, does not remain to be settled in this country. Much more might the legitimacy of the general government be doubted, had it been created by the states. The powers delegated to the state sovereignties were to be exercised by themselves, not by a distinct and independent sovereignty, created by themselves. To the formation of a league, such as was the confederation, the state sovereignties were certainly competent. But when, ‘in order to form a more perfect union,’ it was deemed necessary to change this alliance into an effective government, possessing great and sovereign powers, and acting directly on the people, the necessity of referring it to the people, and of deriving its powers directly from them, was felt and acknowledged by all. The government of the Union, then ( whatever may be the influence of this fact on the case), is, emphatically and truly, a government of the people. In form, and in substance, it emanates from them. Its powers are granted by them, and are to be exercised directly on them, and for their benefit.” [17 US 316, 402-405]

The People, then, and not the states, created the Constitution and thus the Government of the United States.

Next we consider whether the Federal Government or the state governments are supreme: “If any one proposition could command the universal assent of mankind, we might expect it would be this-that the government of the Union, though limited in its powers, is supreme within its sphere of action. This would seem to result, necessarily, from its nature. It is the government of all; its powers are delegated by all; it represents all, and acts for all. Though any one state may be willing to control its operations, no state is willing to allow others to control them. The nation, on those subjects on which it can act, must necessarily bind its component parts. But this question is not left to mere reason: the people have, in express terms, decided it, by saying,  ‘this constitution, and the laws of the United States, which shall be made in pursuance thereof,’ ‘shall be the supreme law of the land,’ and by requiring that the members of the state legislatures, and the officers of the executive and judicial departments of the states, shall take the oath of fidelity to it. The government of the United States, then, though limited in its powers, is supreme; and its laws, when made in pursuance of the constitution, form the supreme law of the land, ‘anything in the constitution or laws of any state to the contrary notwithstanding.’ ” [17 US 316, 405-406]

So the Federal Government is supreme over the state governments. Now let’s consider sovereignty of the governments and the People. “The creation of a corporation, it is said, appertains to sovereignty. This is admitted. But to what portion of sovereignty does it appertain? Does it belong to one more than to another? In America, the powers of sovereignty are divided between the government of the Union, and those of the states. They are each sovereign, with respect to the objects committed to it, and neither sovereign, with respect to the objects committed to the other. We cannot comprehend that train of reasoning, which would maintain, that the extent of power granted by the people is to be ascertained, not by the nature and terms of the grant, but by its date. Some state constitutions were formed before, some since that of the United States. We cannot believe, that their relation to each other is in any degree dependent upon this circumstance. Their respective powers must, we think, be precisely the same, as if they had been formed at the same time. Had they been formed at the same time, and had the people conferred on the general government the power contained in the constitution, and on the states the whole residuum of power, would it have been asserted, that the government of the Union was not sovereign, with respect to those objects which were intrusted to it, in relation to which its laws were declared to be supreme? If this could not have been asserted, we cannot well comprehend the process of reasoning which maintains, that a power appertaining to sovereignty cannot be connected with that vast portion of it which is granted to the general government, so far as it is calculated to subserve the legitimate objects of that government. The power of creating a corporation, though appertaining to sovereignty, is not, like the power of making war, or levying taxes, or of regulating commerce, a great substantive and independent power, which cannot be implied as incidental to other powers, or used as a means of executing them. It is never the end for which other powers are exercised, but a means by which other objects are accomplished. No contributions are made to charity, for the sake of an incorporation, but a corporation is created to administer the charity; no seminary of learning is instituted, in order to be incorporated, but the corporate character is conferred to subserve the purposes of education. No city was ever built, with the sole object of being incorporated, but is incorporated as affording the best means of being well governed. The power of creating a corporation is never used for its own sake, but for the purpose of effecting something else. No sufficient reason is, therefore, perceived, why it may not pass as incidental to those powers which are expressly given, if it be a direct mode of executing them.” [17 US 316, 410-411] Later in the decision, Marshall wrote, “The argument on the part of the state of Maryland, is, not that the states may directly resist a law of congress, but that they may exercise their acknowledged powers upon it, and that the constitution leaves them this right, in the confidence that they will not abuse it. Before we proceed to examine this argument, and to subject it to test of the constitution, we must be permitted to bestow a few considerations on the nature and extent of this original right of taxation, which is acknowledged to remain with the states. It is admitted, that the power of taxing the people and their property, is essential to the very existence of government, and may be legitimately exercised on the objects to which it is applicable, to the utmost extent to which the government may choose to carry it. The only security against the abuse of this power, is found in the structure of the government itself. In imposing a tax, the legislature acts upon its constituents. This is, in general, a sufficient security against erroneous and oppressive taxation. The people of a state, therefore, give to their government a right of taxing themselves and their property, and as the exigencies of government cannot be limited, they prescribe no limits to the exercise of this right, resting confidently on the interest of the legislator, and on the influence of the constituent over their representative, to guard them against its abuse. But the means employed by the government of the Union have no such security, nor is the right of a state to tax them sustained by the same theory. Those means are not given by the people of a particular state, not given by the constituents of the legislature, which claim the right to tax them, but by the people of all the states. They are given by all, for the benefit of all-and upon theory, should be subjected to that government only which belongs to all. It may be objected to this definition, that the power of taxation is not confined to the people and property of a state. It may be exercised upon every object brought within its jurisdiction. This is true. But to what source do we trace this right? It is obvious, that it is an incident of sovereignty, and is co-extensive with that to which it is an incident. All subjects over which the sovereign power of a state extends, are objects of taxation; but those over which it does not extend, are, upon the soundest principles, exempt from taxation. This proposition may almost be pronounced self-evident. The sovereignty of a state extends to everything which exists by its own authority, or is introduced by its permission; but does it extend to those means which are employed by congress to carry into execution powers conferred on that body by the people of the United States? We think it demonstrable, that it does not. Those powers are not given by the people of a single state. They are given by the people of the United States, to a government whose laws, made in pursuance of the constitution, are declared to be supreme. Consequently, the people of a single state cannot confer a sovereignty which will extend over them.” [17 US 316, 427-429]

So the People of the United States, not the people of a single state, are the true sovereigns in the United States, and sovereignty is, in a sense, shared among the Federal and State governments within their own spheres, with the Federal government supreme in its sphere anytime it and the state governments overlap. The people of a single state cannot grant themselves or their state government any powers over the United States.

That would include the makeup of the United States, which would be whether or not a state is a part of the United States.

McCulloch v. Maryland destroys the foundations for the theory that a state can unilaterally secede from the United States.

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8 comments

  1. Jason Perez · · Reply

    Very nice post al,

    What’s your take on people who say Hamilton contradicts himself regarding the necessary and proper clause, I notice alot of 10th amendment loonies quoting him and point him out saying it adds nothing then they quote him regarding the bank later and make it sound like he conveniently changed his mind.

    Obviously those guys don’t like the ruling and ramifications of this case hehe.

    1. I would have to see the claims to comment on them, Jason.

      1. Jason Perez · · Reply

        Hi al

        I think I may have mistaken the implied powers with necessary and proper clause. The stuff about Hamilton can be found here.

        http://tenthamendmentcenter.com/2014/09/03/necessary-and-proper-not-anything-and-everything/

        As you can see I have a bad habit of sifting through garbage but that’s because I like to hear what they got.

        1. It’s a red flag that they don’t quote this alleged “bait and switch.” They’re probably referring to Hamilton’s 23 Feb 1791 “Opinion on the Constitutionality of a National Bank,” in which he says, “It leaves therefore a criterion of what is constitutional and of what is not so. This criterion is the end to which the measure relates as a mean. If the end be clearly comprehended within any of the specified powers, & if the measure have an obvious relation to that end, and is not forbidden by any particular provision of the constitution–it may safely be deemed to come within the compass of the national authority. There is also this further criterion which may materially assist the decision. Does the proposed measure abridge a preexisting right of any State, or of any individual? If it does not, there is a strong presumption in favour of its constitutionality; & slighter relations to any declared object of the constitution may be permitted to turn the scale.”

          You can read the entire document here.

          I find it interesting they privilege the opinion of Thomas Jefferson, a man who was over 3,500 miles away when the Constitution was written over that of a man who was part of the framing and ratification of that Constitution and thus privy to the conversations that took place over what the Constitution meant.

          1. Thanks for the response Al. As we can see, they are also privileging the opinion of George Nicholas from the VA convention…

            “Suppose it had been inserted at the end of every power, that they should have the power to make laws to carry that power into execution; would this have increased their powers? If therefore it could not have increased their powers, if placed at the end of each power, it cannot increase them at the end of all. This clause only enables them to carry into execution the powers given them, but gives them no additional power.”

            and saying it coincides with Hamilton:

            “It may be affirmed with perfect confidence that the constitutional operation of the intended government would be precisely the same, if these clauses were entirely obliterated, as if they were repeated in every article. They are only declaratory of a truth which would have resulted by necessary and unavoidable implication from the very act of constituting a federal government, and vesting it with certain specified powers.”

            And of course, using Rob Natelson (who I am unfamiliar with) they draw their conclusion accordingly.

            But I think the only thing they can actually bring to the table is the understanding is that it does not allow for new powers, but making a lot of assumptions as to what is already implied and wouldn’t be new if asserted in the first place…I suppose its easy to see that kind of wording and come to that conclusion, or worse…see that wording and deliberately and dishonestly use it without considering proper context…never was a fan of tenthamendmentcenter’s agendas…

  2. Jason Perez · · Reply

    Oh also one of the other responses I hear about this is that supposedly Madison was against the decision of Marshall and voices his complaint as such I believe the letter was to Roanoke? Or roane trying to remember… I read it a while back. What are your thoughts on that I’d love to know.

    1. You’re referring to the September 2, 1819 letter from James Madison to Spencer Roane in which Madison disagrees with the doctrine of implied powers contained within the decision, not the entire decision.

      You can see the letter here.

      1. Jason Perez · · Reply

        Ah I see. But Madison it seems is not against implied powers just merely how it was specifically asserted in this case.

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