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McCulloch v. Maryland (1819) was a landmark US Supreme Court case that addressed the issue of Federal power and commerce. The case involved the power of Congress to charter a bank, which sparked a broader issue of the division of powers between state and Federal Government. The Court determined that Congress had the power to create a bank and that states did not have the power to tax the Federal Government. This case set a precedent that gave much discretion to Congress, expanding its constitutional powers.
| Characteristics | Values |
|---|---|
| Date | 1819 |
| Issue Addressed | Federal power and commerce |
| Powers of Congress | Implied powers under the "elastic clause" to create a bank |
| Powers of States | May not impede valid constitutional exercises of power by the federal government; may not tax the federal government |
| Powers of Federal Government | Right to set up a federal bank; supremacy over states |
| Chief Justice | John Marshall |
| Ruling | "The power to tax involves the power to destroy" |
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What You'll Learn
The US federal government is supreme over states
The landmark US Supreme Court case McCulloch v. Maryland (1819) addressed the issue of federal power and commerce. The case involved the power of Congress to charter a bank, which sparked the broader issue of the division of powers between states and the federal government.
In 1816, Congress established the Second National Bank to help control the amount of unregulated currency issued by state banks. Many states questioned the constitutionality of the national bank, and Maryland set a precedent by requiring taxes on all banks not chartered by the state. James W. McCulloch, a federal cashier at the Baltimore branch of the US bank, refused to pay the taxes imposed by the state. Maryland filed a suit against McCulloch in an effort to collect the taxes.
The Supreme Court decided that the federal government had the right and power to set up a federal bank and that states did not have the power to tax the federal government. Chief Justice John Marshall ruled in favor of the federal government, concluding that "the power to tax involves the power to destroy." Marshall supported his opinion by invoking the Necessary and Proper Clause, which permits Congress to seek an objective while exercising its enumerated powers, as long as that objective is not forbidden by the Constitution.
The Court's decision in McCulloch v. Maryland established that the US federal government is supreme over the states, and therefore, states' ability to interfere with the federal government is restricted. This case presented a major issue that challenged the Constitution: does the federal government hold sovereign power over states? The Court's ruling answered this question in the affirmative, concluding that the federal government had the right and power to establish a national bank and that states could not tax it.
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Congress has the power to create a bank
The landmark US Supreme Court case McCulloch v. Maryland in 1819 addressed the issue of federal power and commerce. It involved the power of Congress to charter a bank, sparking a broader issue of the division of powers between state and federal governments. The case presented two key questions: Does the Constitution give Congress the power to create a bank, and can individual states tax or ban the bank?
The Supreme Court decided that Congress had the power to create a bank, with Chief Justice John Marshall ruling in favor of the federal government. Marshall supported his conclusion with four main arguments. Firstly, he argued that historical practice established Congress's power to create a bank. Secondly, he contended that the Constitution grants Congress implied powers to implement the express powers necessary to create a functional national government. Thirdly, Marshall interpreted the Necessary and Proper Clause liberally, rejecting Maryland's narrow interpretation. He argued that Congress could pursue an objective while exercising its enumerated powers as long as the objective was not forbidden by the Constitution. Finally, Marshall asserted that the federal government was supreme over the states, and the states' ability to interfere with the federal government was restricted.
The McCulloch v. Maryland case set a precedent for the relationship between the federal government and the states. Legal scholar Nelson Lund argued that Marshall's ruling "invited congressional overreach" and gave too much discretion to Congress, expanding its constitutional powers. The decision had a significant impact on the interpretation of federal power and the scope of Congress's legislative power.
The background to the case is as follows: in 1816, Congress established the Second National Bank to control the amount of unregulated currency issued by state banks. Maryland set a precedent by requiring taxes on all banks not chartered by the state. In 1818, Maryland approved legislation to impose taxes on the Second National Bank, which refused to comply, resulting in a lawsuit against its head, James William McCulloch. The state argued that the Constitution did not provide a textual commitment for the federal government to charter a bank, and the state appellate court upheld this view. However, the Supreme Court ultimately ruled in favor of the federal government, concluding that Congress had the power to establish a bank and that states did not have the authority to tax the federal government.
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States cannot tax the federal government
McCulloch v. Maryland was a landmark U.S. Supreme Court case that defined the scope of the U.S. Congress's legislative power and its relationship with the powers of American state legislatures. The case addressed the issue of federal power and commerce, specifically challenging the Constitution and posing the question: does the Federal Government hold sovereign power over states?
The dispute in McCulloch v. Maryland involved the legality of the national bank and a tax that the state of Maryland imposed on it. In 1816, the U.S. Congress created the Second Bank of the United States, which opened a branch in Baltimore, Maryland, in 1817. In 1818, the Maryland legislature voted to impose a tax on all banks within the state that were not chartered by the state legislature. The Second Bank of the United States refused to comply with the law, resulting in a lawsuit against its head, James William McCulloch, a federal cashier at the Baltimore branch of the U.S. bank.
The Supreme Court, in a unanimous decision, ruled in favor of the federal government, concluding that the Federal Government had the right and power to set up a federal bank and that states did not have the power to tax the Federal Government. Chief Justice John Marshall supported his conclusion with four main arguments. Firstly, he argued that historical practice established Congress's power to create a bank. Secondly, he argued that the Constitution grants Congress implied powers to implement the Constitution's express powers to create a functional national government. Thirdly, Marshall supported his opinion textually by invoking the Necessary and Proper Clause, which permits Congress to seek an objective while exercising its enumerated powers as long as that objective is not forbidden by the Constitution. Finally, Marshall ruled that "the power to tax involves the power to destroy," implying that if states could tax one instrument of the federal government, they could tax any and every other instrument, thereby arresting all the measures of the government and prostrating it at the foot of the states. This was not intended by the American people, and the power to tax any instrument of the federal government was not within the scope of the Constitution.
The McCulloch v. Maryland decision set a precedent that gave much discretion to Congress, expanding its constitutional powers. The case was also influential outside of the United States, being cited in the first substantial constitutional case presented before the High Court of Australia in D'Emden v Pedder (1904). The Australian Court determined that the McCulloch decision provided the best guideline for the relationship between the Commonwealth federal government and the Australian states, due to strong similarities between the American and Australian constitutions.
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The federal government can set up a federal bank
The landmark Supreme Court case McCulloch v. Maryland in 1819 addressed the issue of Federal power and commerce. It involved the power of Congress to charter a bank, sparking a broader issue of the division of powers between the state and the Federal Government.
The case concerned the Second National Bank, established by Congress in 1816 to help control the amount of unregulated currency issued by state banks. Many states questioned the constitutionality of the national bank, and Maryland set a precedent by requiring taxes on all banks not chartered by the state. The Second National Bank refused to pay these taxes, resulting in a lawsuit against its head, James William McCulloch. Maryland argued that "the Constitution is silent on the subject of banks," and without specific constitutional authorization, any such creation would be unconstitutional.
The Supreme Court, however, decided that the Federal Government had the right and power to set up a Federal bank, and states did not have the power to tax the Federal Government. Chief Justice John Marshall ruled in favor of the Federal Government, concluding that "the power to tax involves the power to destroy." He supported his opinion by invoking the Necessary and Proper Clause, which permits Congress to seek an objective while exercising its enumerated powers, as long as that objective is not forbidden by the Constitution.
This case was significant as it established that the Federal Government is supreme over the states, restricting the states' ability to interfere with the Federal Government. It also clarified that the Constitution grants Congress implied powers to implement the express powers necessary for creating a functional national government.
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The expansion of federal power
The McCulloch vs Maryland case was a landmark US Supreme Court decision that defined the scope of the US Congress's legislative power and its relationship with the powers of American state legislatures. The case involved the power of Congress to charter a bank, which sparked the broader issue of the division of powers between state and federal governments.
The Court determined that Congress had the power to establish a national bank, and that states could not interfere with or tax such a bank. This decision established the supremacy of the federal government over state governments and restricted states' abilities to impede valid constitutional exercises of federal power. The ruling clarified that the federal government had sovereign power over states, and its laws made in pursuance of the Constitution formed the "supreme law of the land."
Legal scholars have debated the implications of the McCulloch vs Maryland ruling, with some arguing that it invited congressional overreach and diminished the powers of the states. The decision set a precedent that granted Congress significant discretion in interpreting and expanding its constitutional powers. The case had a significant impact on similar disputes in other federal systems, such as the Australian Federation, where it influenced the relationship between the Commonwealth federal government and the Australian states.
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Frequently asked questions
The McCulloch vs Maryland case determined that the Federal Government had the right and power to set up a Federal bank and that states did not have the power to tax the Federal Government.
The case was a landmark Supreme Court decision that defined the scope of Congress's legislative power and its relationship with the powers of American state legislatures.
The case involved the power of Congress to charter a bank, specifically the Second National Bank, which sparked the broader issue of the division of powers between state and Federal Government.
The state of Maryland argued that the Constitution did not explicitly authorise the Federal Government to create a bank, and therefore any such creation would be unconstitutional. The Court, however, ruled that Congress had the implied power to create a bank under the "elastic clause" of the Constitution.
The decision set a precedent that expanded the constitutional powers of Congress and affirmed the supremacy of the Federal Government over states. It has also been cited in similar constitutional cases in other countries, such as Australia.
