Omar Bennett
The United States Constitution grants Congress significant economic powers, including the authority to tax, borrow money, regulate commerce, coin money, and promote scientific progress. These powers, outlined in Article I, Section 8, provide Congress with the ability to shape the country's economic landscape and promote the general welfare of its citizens. Additionally, Congress has the power to declare war, raise and maintain armed forces, and make rules for the military, impacting economic decisions and policies. The House of Representatives and the Senate, which together make up Congress, also have unique powers, such as the House's ability to initiate revenue bills and the Senate's role in confirming presidential appointments. The Constitution's Necessary and Proper Clause further enables Congress to pass laws deemed necessary and proper to execute its functions, giving it flexibility in addressing economic matters.
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What You'll Learn
To lay and collect taxes
Article I, Section 8 of the US Constitution grants Congress the power "to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defence and general welfare of the United States". This power is often referred to as the "Taxing and Spending Clause" or "Congressional spending power".
The power to tax and spend is a fundamental aspect of governance and is essential for funding government operations and programmes that serve the public. Congress has used this power to pursue broad policy objectives, such as welfare aid and security/military funding.
The interpretation and application of the Taxing and Spending Clause have evolved over time, with disputes arising over the scope of Congress's spending authority. The Supreme Court addressed this issue in the 1930s, embracing a broad view of Congress's discretion to identify expenditures that further the general welfare. This interpretation has allowed Congress to allocate funds to areas such as Medicaid, federal education programs, and laws regulating local land-use decisions and the treatment of institutionalized persons.
The "Taxing and Spending Clause" also includes the power to collect income taxes, as outlined in the Sixteenth Amendment and governed by the Internal Revenue Code. States are also permitted to impose and collect their own taxes, including income taxes, sales taxes, and property taxes, which vary based on individual state legislation.
Congress has occasionally delegated certain tax-related powers to the President. For example, the Trading with the Enemy Act of 1917 allowed the President to oversee and restrict commerce and impose tariffs or sanctions during wartime. Similarly, the Trade Expansion Act of 1962 and the International Emergency Economic Powers Act of 1977 granted the President the authority to impose and adjust tariffs and regulate commerce in response to national security threats and declared national emergencies, respectively.
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To borrow money
Article I, Section 8 of the Constitution outlines the powers of Congress in great detail. One of these powers is "To borrow Money on the credit of the United States". This power is often referred to as the "power of the purse" and gives Congress significant authority over the executive branch, as it must appeal to Congress for funding.
The federal government borrows money by issuing bonds. Congress also has the power to lay and collect taxes, duties, imposts, and excises, as well as to regulate commerce with foreign nations and Native American tribes. These powers allow Congress to generate revenue and fund its operations.
The "Necessary and Proper Clause" of the Constitution further broadens Congress's legislative authority. This clause permits Congress to "make all laws which shall be necessary and proper for carrying into execution the foregoing powers and all other powers vested by this Constitution in the government of the United States". This means that Congress can pass laws it deems necessary to carry out its enumerated functions, including borrowing money and managing the nation's finances.
Congress also has the power to propose amendments to the Constitution and specify the process for their ratification. Additionally, Congress has the authority to make laws, which is considered one of its most important powers. This includes the power to pass authorization and appropriation bills, setting the maximum amount of money available for government programs and determining the actual amount allocated in the fiscal year.
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To regulate commerce
The Commerce Clause, outlined in Article 1, Section 8, Clause 3 of the US Constitution, grants Congress the power "to regulate commerce with foreign nations, among states, and with the Indian tribes". This clause has been a source of controversy, with critics arguing that it was intended to have a narrower scope and that its broad interpretation has led to an expansion of federal power at the expense of state rights.
The interpretation of the Commerce Clause has evolved over time, with the Supreme Court initially interpreting it narrowly, focusing on the direct movement of goods across state lines. However, as the economy grew more complex, the Court began to interpret the clause more broadly, recognising that it could be used to regulate a wider range of economic activities. This shift began with the 1937 NLRB v. Jones & Laughlin Steel Corp case, where the Court held that any activity with a “substantial economic effect" on interstate commerce or a “cumulative effect" that could impact such commerce fell within the scope of the clause.
This broad interpretation allowed Congress to regulate various economic activities, including labour standards across states, as seen in the Darby case (1941), where the federal government's authority to enforce the Fair Labor Standards Act was upheld. The Court's liberal construction of the clause continued into the New Deal era, with the Wickard v. Filburn case (1942) further expanding the federal government's reach into intrastate activities that could indirectly affect interstate commerce.
However, in United States v. Lopez (1995), the Supreme Court attempted to curtail Congress's power by returning to a more conservative interpretation of the clause, holding that Congress could only regulate the channels of commerce, the instrumentalities of commerce, and actions that substantially affect interstate commerce. Despite this, the Commerce Clause remains a powerful tool for Congress to regulate the economy and protect American interests, even in intrastate matters, as seen in the Gonzales v. Raich case (2005), where the Court upheld federal regulation of intrastate marijuana production.
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To coin money
Article I, Section 8 of the United States Constitution grants Congress the power "to coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures"*. This clause, known as the Coinage Clause, gives Congress the exclusive power to mint coins and regulate the value of both US and foreign currency. This power enables the federal government to maintain a stable currency and regulate economic activities, facilitating trade and economic growth.
The Supreme Court has interpreted the Coinage Clause as giving Congress the authority to regulate every phase of currency. This includes the power to charter banks and endow them with the right to issue circulating notes, such as coins, banknotes, and government notes. Congress can also restrain the circulation of notes not issued under its own authority and levy taxes on banknotes issued by state banks or "municipal corporations".
The Coinage Clause is related to Congress's power to punish counterfeiting. The Constitution grants Congress the power to prohibit the creation of counterfeit coins or money and pass federal laws that punish the importation and use of counterfeit money. The Supreme Court has upheld Congress's authority to abrogate clauses in pre-existing private contracts calling for payment in gold coin or allowing bondholders to elect to be paid in foreign currencies.
The Coinage Clause also has implications for contracts and debts. The Supreme Court has sustained the power of Congress to make Treasury notes legal tender in satisfaction of antecedent debts. The Court has also held that the power to coin money includes the authority to maintain coinage as a medium of exchange and forbid its diversion to other uses by defacement, melting, or exportation.
Overall, the power "to coin money" granted to Congress in the United States Constitution enables the federal government to regulate currency and maintain a stable economic system, facilitating trade and economic growth within a clear legal framework.
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To declare war
Article I, Section 8 of the US Constitution grants Congress the power to declare war. This power is known as the "Declare War Clause", and it gives Congress the authority to initiate hostilities and make formal declarations of war. This clause has been interpreted to mean that presidents cannot declare war without Congressional approval, though there is debate around the extent to which this clause limits the president's ability to use military force independently.
Historically, presidents have initiated the process of going to war, but they have sought and received formal war declarations from Congress. This was the case for the War of 1812, the Mexican-American War, the Spanish-American War, World War I, and World War II. However, there have been instances where presidents have used military force without formal declarations or express consent from Congress, such as in the Korean War and the Vietnam War.
The Declare War Clause also grants Congress the power to "grant Letters of Marque and Reprisal" and "make Rules concerning Captures on Land and Water". This allows Congress to authorise private citizens to capture enemy vessels and goods during times of war. Additionally, Congress has the power to raise and support Armies, provide for and govern the Militia, and exercise exclusive Legislation over the district that is the seat of the US government. These powers give Congress significant control over the country's military forces and their deployment.
Congress also has the power to regulate commerce with foreign nations and pass laws that restrict commerce during times of war. For example, the Trading with the Enemy Act of 1917 allowed the president to oversee and restrict commerce with enemy nations during wartime. Congress has also passed laws like the International Emergency Economic Powers Act, which authorises the president to declare national emergencies and regulate commerce during those emergencies. These laws demonstrate how Congress can delegate certain powers to the president while retaining ultimate authority over matters of war and commerce.
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Frequently asked questions
Article I of the Constitution outlines the powers of Congress, with Section 8 providing specific economic powers. These include the power to:
- Lay and collect taxes, duties, imposts, and excises
- Borrow money on the credit of the United States
- Regulate commerce with foreign nations and among the states
- Coin money and regulate its value
- Establish a uniform rule of naturalization and uniform laws on bankruptcy
The Necessary and Proper Clause, also known as the 'elastic' or 'implied powers' clause, permits Congress to:
> "make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."
This clause has been interpreted broadly, widening Congress's legislative authority. For example, it has been used to justify the federal government's authority to establish a national bank under the tax and spend clause.
Congress has the power to raise and support armies, declare war, and make rules concerning captures on land and water. It also has the ''power of the purse', which gives it authority over the executive branch as it must appeal to Congress for funding. Congress also has investigative powers and can propose amendments to the Constitution.
