McCulloch v Maryland (1819)
Treasury Secretary Alexander Hamilton wanted to create a national bank not long after George Washington was inaugurated into office. Although there was some friction at first, Congress agreed with Hamilton and created the First Bank of the United States. It stalled out, but then Congress created the Second Bank in response to the War of 1812 and the economic issues it brought. States lost some power with the creation of federal banks, and they punished banks for it. For example, Maryland taxed $15,000 to banks that were not chartered (authorized) by the state. James McCulloch, the head of the Second Bank in Baltimore, would not pay the tax. The state of Maryland argued that, without the proper confirmation from the Constitution, making a federal bank is unconstitutional. The question is, can Congress make a national bank, and could Maryland constitutionally tax the bank?
Breakdown Verdict.
A unanimous decision determined that Congress was able to establish a national bank, and also that Maryland was unable to tax a national organization. Chief Justice Marshall, a proponent of centralized national empowerment, expanded upon the “necessary” Constitutional demand in his argument. He interpreted it as tasks both “appropriate and legitimate” to enforce Congress’s enumerated (disclosed) powers in the Constitution. He also stated that the people as a whole were sovereign (source of governmental authority) rather than the states themselves.
Result Going Forward.
The main issue of this case is that Congress’s powers go beyond what is specifically stated in the Constitution and extends into implied powers, with the creation of a national bank as an example. As stated earlier, the Constitution’s Necessary and Proper Clause reinforced that the government should do whatever is necessary to serve the people, and therefore the states were not authorized to tax the federal government; Marshall’s famous statement is that “the power to tax involves the power to destroy”. Thus, a federal supremacy was solidified and confirmed what the government could do.
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