Constitutional Law I Federal Power McCulloch v. Maryland

Spring, 2005Con Law I - Manheim2 A little banking history Pre-constitution State banks issued coin & currency Constitution (1787) States prohibited to issue currency (Art I, § 10) Pre-const’l war debts remain valid (Art. VI, § 1) First Bank of the United States (1791) Established by Congress to pay war debt and create standard form of currency Charter lapses in 1811

Spring, 2005Con Law I - Manheim3 First Bank of the United States, Phil.

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Spring, 2005Con Law I - Manheim5 A little banking history Second Bank of the United States (1816) Congress had difficulty financing war of d Bank chartered in 1816 Upheld in McCulloch v. Maryland (1819) States claimed it was an instrument of federal control & eastern commercial interests

Spring, 2005Con Law I - Manheim6 2 nd Bank of the United States Phil. PA tickets

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Spring, 2005Con Law I - Manheim8 Federal Reserve Board

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Spring, 2005Con Law I - Manheim11 Federal Power - Themes Federalism Federal government has limited power – enumerated in the constitution All government power not delegated to the federal government remains with states Unionists (supporters of strong central government) argue for broad federal power States-rights advocates argue for narrow federal power

Spring, 2005Con Law I - Manheim12 Quick Aside - Preemption preempts Under the Supremacy Clause – Art. 6, § 2 – federal law preempts (displaces) state law Broad federal power gives congress more opportunity to displace state law Narrow federal power means less federal displacement of state law Sovereignty is a zero-sum equation States' Rights (and its corollary – federal power) is the oldest and most litigated of all constitutional issues

Spring, 2005Con Law I - Manheim13 McCulloch v. Maryland (1819) Can Maryland impose a tax on the Bank of the United States? May depend upon whether the act establishing the bank is constitutional v.

Spring, 2005Con Law I - Manheim14 Nicholas Biddle, last president of 2 nd Bank of US

Spring, 2005Con Law I - Manheim15 McCulloch v. Maryland (1819) Has congress power to incorporate a bank? (2 nd Bank of the United States) Not among the 17 grants of power in § 8

Spring, 2005Con Law I - Manheim16 How we got here Articles of Confederation (1781) Preserved state sovereignty, unanimous vote Weak fed'l power was major failing of Articles

Spring, 2005Con Law I - Manheim17 Doctrine of Enumerated Powers Fed'l gov't can exercise "only the powers granted to it" "But the question respecting the extent of the powers actually granted, is perpetually arising, and will probably continue to arise, so long as our system shall exist." "the government of the Union, though limited in its powers, is supreme within its sphere of action" Read non-delegated powers narrowly Read delegated powers broadly

Spring, 2005Con Law I - Manheim18 Doctrine of Implied Powers Textual support for doctrine Necessary and Proper Clause  Art. I, § 8, ¶ 18: "To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers …" Is this a term of limitation or expansion? Must be? Could be? Who decides?

Spring, 2005Con Law I - Manheim19 Doctrine of Implied Powers Textual support for doctrine Necessary and Proper Clause  Art. I, § 8, ¶ 18: "To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers …" This clause is placed in § 8, not § 9 Congress shall have power..

Spring, 2005Con Law I - Manheim20 Marshall’s Test “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” ENDS must be enumerated MEANS must be “plainly adapted” (reasonable) Cannot transgress prohibition in text Rational Basis test

Spring, 2005Con Law I - Manheim21 Maryland’s Tax on Bank of US Where do states get the power to tax? Does the const. explicitly withdraw this? See Art. I Sec. 10, par. 2 & 3. "No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection laws …" Does the Tax conflict with federal law? Express conflicts Implied conflicts

Spring, 2005Con Law I - Manheim22 Supremacy & Implied Preemption Does the tax negate the federal act? “The power to tax is the power to destroy” Can’t the states be trusted to tax reasonably? Even if reasonable, does a state tax deny federal supremacy? States never possessed the right to tax the superior gov’t The const. need not negate such a right