McCulloch v Maryland (1819)
BACKGROUND
Background Summary & Questions (••)
In 1791, the U.S. government created the first national bank for the country. During this time, a
national bank was controversial because people had different opinions about what powers the
national government should have. Alexander Hamilton believed that the national government had
the power to create a new national bank. Thomas Jefferson believed that the national government
did not have such a power. When Thomas Jefferson was president, he did not renew the national
bank's charter. After the War of 1812, President James Madison decided that the country needed a
national bank, and he asked Congress to create a Second Bank of the United States in 1816.
After President Madison approved the bank, many branches were opened throughout the country.
Many states did not want the new bank branches to open. There were several reasons why the states
opposed these national banks. They competed with the state banks, many national bank managers
were thought to be corrupt, and the states believed that the national government was getting too
powerful.
Maryland tried closing down the Baltimore branch of the national bank by passing a law that forced
all banks that were created outside of the state pay a $15,000 tax each year. James McCulloch, who
worked at the Baltimore Branch, refused to pay the tax.
The State of Maryland took McCulloch to court saying that Maryland had the power to tax any
business in its state. Luther Martin, a lawyer for Maryland, said that if the national government had
the power to regulate state banks, then Maryland had the power to regulate national banks. He also
said that the Constitution does not give Congress the power to create a national bank.
After McCulloch was convicted of violating the tax statute and fined $2,500, he appealed the court's
decision to the Maryland Court of Appeals. His lawyer argued that creating a national bank was a
"necessary and proper" job of Congress. He stated that many of the powers of the national
government are not written in the Constitution, but are necessary for the national government to do
its job. Also, he claimed that Maryland could not place a tax on the national bank because the tax
would not let the national bank do its job.
The Maryland Court of Appeals agreed with the lower court's decision. McCulloch then appealed to
the Supreme Court of the United States, led by Chief Justice John Marshall.
Questions to Consider
1. What are the advantages of establishing a national bank? Article I, Section 8, Clause 18 of the
Constitution to determine which functions of Congress might be helped by such a bank.
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McCulloch v Maryland (1819)
BACKGROUND
2. Why would the states feel uncomfortable with a national bank?
3. In your opinion, does the U.S. government have the power to create a national bank? Why or
why not? Examine the enumerated powers in Article I, Section 8, Clause 18 to support your
answer.
4. If the United States does have the power to create a national bank, does Maryland have the
power to tax the bank? Why or why not?
5. Why do you think the Supreme Court of the United States heard the case?
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McCulloch v Maryland (1819)
BACKGROUND
Article 1, Section 8 of the Constitution
The Congress shall have 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; but all
Duties, Imposts and Excises shall be uniform throughout the United States;
To borrow Money on the credit of the United States;
To regulate Commerce with foreign Nations, and among the several States, and with the Indian
Tribes;
To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies
throughout the United States;
To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights
and Measures;
To provide for the Punishment of counterfeiting the Securities and current Coin of the United
States;
To establish Post Offices and post Roads;
To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and
Inventors the exclusive Right to their respective Writings and Discoveries;
To constitute Tribunals inferior to the supreme Court;
To define and punish Piracies and Felonies committed on the high Seas, and Offences against the
Law of Nations;
To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on
Land and Water;
To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term
than two Years;
To provide and maintain a Navy;
To make Rules for the Government and Regulation of the land and naval Forces;
To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and
repel Invasions;
To provide for organizing, arming, and disciplining, the Militia, and for governing such Part of them
as may be employed in the Service of the United States, reserving to the States respectively, the
Appointment of the Officers, and the Authority of training the Militia according to the discipline
prescribed by Congress;
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McCulloch v Maryland (1819)
BACKGROUND
To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles
square) as may, by Cession of Particular States, and the Acceptance of Congress, become the Seat of
the Government of the United States, and to exercise like Authority over all Places purchased by the
Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts,
Magazines, Arsenals, dock-Yards and other needful Buildings;--And
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.
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McCulloch v Maryland (1819)
Important Vocabulary (•••/••)
•
charter
Define:
Use in a sentence:
•
corrupt
Define:
Use in a sentence:
•
regulate
Define:
Use in a sentence:
•
implied (to imply)
Define:
Use in a sentence:
•
appealed (to appeal)
Define:
Use in a sentence:
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BACKGROUND
McCulloch v Maryland (1819)
DECISION
Key Excerpts from the Majority Opinion
The decision was 7 to 2. Chief Justice Roger B. Taney delivered the opinion of the Court.
The first question made in the case is-has congress power to incorporate a bank?
...
This government is acknowledged by all to be one of enumerated powers. . . .
Among the enumerated powers, we do not find that of establishing a bank or creating a corporation.
But there is no phrase in the instrument which, like the articles of confederation, excludes incidental
or implied powers; and which requires that everything granted shall be expressly and minutely
described. Even the 10th amendment . . . omits the word "expressly," and declares only, that the
powers "not delegated to the United States, nor prohibited to the states, are reserved to the states or
to the people;" . . . A constitution, to contain an accurate detail of all the subdivisions of which its
great powers will admit, and of all the means by which they may be carried into execution . . . would,
probably, never be understood by the public. Its nature, therefore, requires, that only its great
outlines should be marked.
...
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. . . .
But the constitution of the United States has not left the right of congress to employ the necessary
means, for the execution of the powers conferred on the government, to general reasoning. To its
enumeration of powers is added, that of making "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 thereof.". . .
. . . This provision is made in a constitution, intended to endure for ages to come, and, consequently,
to be adapted to the various crises of human affairs. To have prescribed the means by which
government should, in all future time, execute its powers, would have been . . . an unwise attempt to
provide . . . for exigencies which, if foreseen at all, must have been seen dimly, and which can be
best provided for as they occur. . . .
. . . 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. . . .
. . . [I]t is the unanimous and decided opinion of this Court, that the act to incorporate the Bank of
the United States is . . . constitutional; and that the power of establishing a branch in the State of
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McCulloch v Maryland (1819)
DECISION
Maryland might be properly exercised by the bank itself, we proceed to inquire. . . . 2. Whether the
State of Maryland may, without violating the constitution, tax that branch? . . .
. . . There is no express provision for the case, but the claim has been sustained on a principle which
so entirely pervades the constitution. . . . This great principle is, that the constitution and the laws
made in pursuance thereof are supreme; that they control the constitution and laws of the respective
states, and cannot be controlled by them. From this . . . other propositions are deduced as
corollaries. . . .
. . . That the power to tax involves the power to destroy. . . . If the states may tax one instrument,
employed by the government in the execution of its powers, they may tax any and every other
instrument. They may tax the mail; they may tax the mint; they may tax patent-rights; they may tax
the papers of the custom-house; they may tax judicial process; they may tax all the means employed
by the government, to an excess which would defeat all the ends of government. This was not
intended by the American people. They did not design to make their government dependent on the
states. . . .
. . . The result is a conviction that the states have no power, by taxation or otherwise, to retard,
impede, burden, or in any manner control, the operations of the constitutional laws enacted by
congress to carry into execution the powers vested in the general government. This is, we think, the
unavoidable consequence of that supremacy which the constitution has declared. We are
unanimously of opinion, that the law passed by the legislature of Maryland, imposing a tax on the
Bank of the United States, is unconstitutional and void.
Questions to Consider
1. How did Chief Justice John Marshall justify the power of the federal government to establish a
bank? What phrases in the Constitution does he use to support his argument?
2. The Articles of Confederation did not allow the national government to exercise implied
powers. Why?
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McCulloch v Maryland (1819)
DECISION
3. How does one determine that a power is "implied" when it is not specifically stated in the
Constitution?
4. In the Court's opinion, Chief Justice Marshall says, "the power to tax involves the power to
destroy". Explain.
5. In making this decision, the Supreme Court of the United States helped to determine the
relationship of the federal and state governments to one another. Which is supreme? What
impact did this decision have on the future of the United States? If the decision had been
different-that the states had power to regulate or tax the national government-how might our
lives be different now?
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McCulloch v Maryland (1819)
DECISION
Summary of the Decision
In an opinion written by Chief Justice Marshall, the Supreme Court unanimously ruled in favor of
McCulloch and against the state of Maryland. The Court addressed two questions: 1) whether
Congress had the authority under the Constitution to commission a national bank, and 2) if so,
whether the state of Maryland had the authority to tax a branch of the national bank operating
within its borders.
The justices first addressed the issue of whether the Constitution gave Congress the power to
establish a national bank. They acknowledged that it was not within the enumerated powers of
Congress, authority explicitly given to Congress in the Constitution, to establish a national bank. He
also noted that there is nothing in the Constitution restricting the powers of Congress to those
specifically enumerated. Rather, only the “great outlines” of the powers of the three branches are
specified. Instead of listing every power of Congress, the Constitution gives Congress the authority
to make “all laws which shall be necessary and proper” for exercising the powers that are specifically
enumerated. This means that Congress has the authority to pass any law that is “necessary and
proper” to exercise its power as specified in the Constitution, even if the Constitution does not
explicitly give Congress the authority to pass that specific law or to regulate that specific
matter. This is the principle of unenumerated powers. The justices noted that the Constitution
expressly gives Congress the 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.” Because a
national bank would be “necessary and proper” to allow Congress to exercise these enumerated
powers, the Court concluded that the Constitution gave Congress the authority to establish one.
The second issue the Court considered is whether the state of Maryland had the authority to tax a
branch of the national bank operating within its borders. The Court determined that it did not. In
their decision, the justices declared that “the constitution and the laws made in pursuance thereof
are supreme; that they control the constitution and laws of the respective states, and cannot be
controlled by them.” In other words, if the United States Congress passed a law within its authority
under the Constitution, a state legislature could not pass a law to interfere with that action. “The
power to tax is the power to destroy,” they decided. Allowing a state to tax a branch of the national
bank created by Congress would allow that state to interfere with the exercise of Congress’s
constitutional powers. Thus because “states have no power, by taxation or otherwise, to retard,
impede, burden or in any manner control” the operation of constitutional laws passed by Congress,
Maryland could not be allowed to tax a branch of the national bank, even though that branch was
operating within its borders. The law passed by the Maryland state legislature imposing a tax on the
Bank of the United States “is unconstitutional and void.”
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