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McCulloch v. Maryland
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1819
SYNOPSIS OF CASE:
In 1818, the state of Maryland charged the Baltimore branch of the Second Bank of
the United States a large tax. The Second Bank of the United States had been created
by the federal government. Many states questioned the constitutionality of the national
bank, and Maryland challenged the federal government’s authority by requiring taxes
on all banks not chartered by the state. When James W. McCulloch, the head cashier
of the branch, refused to pay the taxes, he was charged hefty fines. Maryland filed suit
against McCulloch to collect the fines and taxes. Both the County Court of Baltimore
County and the Maryland Court of Appeals convicted McCulloch for failing to pay
the taxes due. The case climbed to the Supreme Court where three main questions
were addressed: the first asked whether a national bank was constitutional; the next
addressed whether the federal government holds sovereign power over states; the last
considered whether individual states
could tax federal entities within its
borders.
MAIN CHARACTERS:
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Chief Justice John Marshall
James W. McCulloch, cashier of
the Baltimore branch of the Bank
of the United States
Luther Martin, one of the state of
Maryland’s attorneys
Daniel Webster, one of
McCulloch’s attorneys
LEGAL/CONSTITUTIONAL
ISSUE(S):
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Implied powers
Division of powers between
federal and state government
Constitutionality of a national
bank
MAJORITY OPINION:
Daniel Webster
The Supreme Court ruled in favor of McCulloch, holding that the establishment of a
national bank was a "necessary and proper" function of the national government under
Article I, Section 8, Clause 18 of the U.S. Constitution. It ruled that many powers of
the government are implied rather than specifically stated in the Constitution. It also
ruled that the state of Maryland did not have the authority to tax the Bank of the
United States because "The power to tax involves the power to destroy.” Chief Justice
John Marshall handed down the verdict: "…Although, among the enumerated powers
of government, we do not find the word “bank” or “incorporation,” we find the great
powers to lay and collect taxes; to borrow money; to regulate commerce; to declare
and conduct a war; and to raise and support armies and navies…But it may with great
reason be contended, that a government, entrusted with such ample powers…must
also be entrusted with ample means for their execution. The power being given, it is
the interest of the nation to facilitate its execution… "
ARGUMENTS AGAINST THE COURT:
The arguments against the court held that the Constitution does not give Congress the
power to establish a Bank of the United States. Representatives from the state argued
that because Maryland is a sovereign state, it has the authority to tax businesses within
its border, and that because the Second Bank of the United States was one such
business, it should pay the tax.
PRECEDENT SET:
This case founded the concept of implied powers: powers that are reasonably inferred
from the enumerated powers in the Constitution. Article I, Section 8, Clause 18 of the
U.S. Constitution became known as the elastic clause, which granted Congress the
authority to “make all laws which shall be necessary and proper for carrying into
execution” the work of the federal government. It also set the precedent for a more
flexible interpretation of the Constitution and the trend of national supremacy over
states.
What if the Supreme Court would have ruled that the federal government does not have the authority
to make laws that the Constitution does not explicitly express? How do you think our current
government would be different? What examples can you describe of laws the Federal government
enacts today that come from the implied powers of the Constitution?