[SOUND] I'm now at the third major part of my lecture. I want to talk about the federal legislative power. Article I of the Constitution defines the powers of Congress. Specifically, it says that the legislative power will be vested in a Congress of the United States, which is all of the powers herein granted. It then proceeds to create Congress in two bodies. The Senate, where every state would have equal representation. Every state regardless of size has two senators. And the House of Representatives, where representation is allocated on the basis of population. Article I, Section 8 is quite crucial, enlisting the powers of Congress. Article I, Section 9 imposes some limits on the powers of Congress. In discussing the federal legislative power, I want to focus on three major questions. First, I want to talk about how does McCullough versus Maryland define the powers of Congress? Second, I want to know about what are the major powers of Congress under the Constitution? And third, I want to talk about to what extent is the existence of state governments a limit on Congress' power? So let me begin with the first of these questions. How does McCullough versus Maryland define the power of Congress? No Supreme Court case in history is more important than McCullough versus Maryland when it comes to defining the powers of the United States Congress. I am fond of saying to my students that McCullough versus Maryland is as the Congress' power as Marbury versus Madison is as to the federal judicial power. McCullough versus Maryland is a decision from 1819. It lays out a framework with regard to congressional authority and the relationship between that and the states that exists to this day. It's a controversy that involved the creation of the Bank of the United States. Early in the presidency of George Washington, a controversy arose as to whether to create a Bank of the United States, a place to hold the assets of the United States government. George Washington asked various people in his cabinet, and Thomas Jefferson as Secretary of State said the United States government doesn't have the authority to create a Bank of the United States. Congress can only do the things that are herein granted, and there's nothing in Article I, Section 8 that says Congress can create a bank. He went to his attorney general, Edmund Randolph, and Randolph said Congress doesn't have the authority to create a Bank of the United States, it's not in the Constitution. But his secretary of treasury, Alexander Hamilton, said yes, Congress has the authority to create the Bank of the United States. So isn't it interesting when we think about things like originalism and framer's intent, that you have these individuals who played key roles in the drafting of the Constitution? And they disagreed among themselves as to whether Congress had the power to create a Bank of the United States. But Washington followed Hamilton's advice. Congress went along, and Congress passed the authority for a Bank of the United States. Interestingly, one of the foremost opponents of Congress having the authority to do this was a congressman then from Virginia, James Madison, who said Congress can only do the things that are mentioned in the Constitution. And there's no mention of a power to create a Bank of the United States. The Bank of the United States existed through the early part of American history without controversy. The authority for it expired. It went out of existence. Then there was the War of 1812. And we tend to forget what a difficult war it was for the United States, as England attacked the United States and tried to reclaim its former colony. The United States won the War of 1812, but the United States government experienced a severe liquidity crisis. It didn't have the assets to fight the war and to keep the government going. And so the then president of the United States, James Madison, proposed that a Bank of the United States be created. Remember of course, Madison was a foremost opponent of there being authority for a Bank of the United States. A new Bank of the United States was created. The United States government owned only a 20% share of this bank. And for the first few years, again, it operated without incident. But then the United States experienced a terrible recession. And the Bank of the United States, as it had the authority to do, asked that some of the loans that had been made repaid. Well, some of the loans that it had made were to state governments and it asked that these loans be repaid. The state governments didn't have the money. They too were experiencing financial problems because of the recession. And there was great tension between the United States government, the Bank of the United States, and the states. In one instance, the Bank of the United States went to collect its debts from the state of Maryland, and the state of Maryland objected to having to pay the Bank of the United States. And so what happened was that the state of Maryland files a lawsuit against the cashier of the Bank of the United States, a man by the name of McCullough. What we know from history is that McCullough was a crook. He was the cashier of the Bank of the United States. Was regularly embezzling money from the Bank of the United States, which is an aside to this story, but it's an interesting background. And the case comes to the United States Supreme Court. And John Marshall is the Chief Justice still. And the Supreme Court has to face the question, here's how it comes up. Maryland has imposed a tax on the Bank of the United States. Maryland has gone to collect the tax on the Bank of the United States. It sues the cashier of the Bank of the United States to collect the tax. Does the Bank of the United States have to pay that tax? That's what McCullough versus Maryland was all about. The Supreme Court says it's going to address two questions. First, does Congress have the authority to create the Bank of the United States? And second, if so, does the state have the authority to tax the Bank of the United States? The Supreme Court, with John Marshall writing, rules in favor of the United States and against the state of Maryland on both issues. As to the first question, does Congress have the authority to create the Bank of the United States? John Marshall begins by saying that we don't write on a blank slate here. This isn't the first time that Congress has done this. He said, Congress, early in American history, created a Bank of the United States when George Washington was president. He said, that should influence our decision. Now it's interesting that Congress had created a Bank of the United States then, but its constitutionality had never been challenged in court. Was that practice a sufficient basis to justify creating this Bank of the United States? To what extent do practices influence the interpretation of the Constitution, or should the court just focus on the original understanding? because back what I talked about earlier in terms of the debate over interpretation. But John Marshal says, writing for the court, we've had a Bank of the United States, that shows that this is constitutional. Now the states that argued to the Supreme Court that it was the state governments that had created the Constitution, and that the states therefore were sovereign. They said the United States government is just a compact among the states, that sovereignty ultimately rests in the states, and that it doesn't rest in Congress. And John Marshall, in explaining why Congress had the authority to create the Bank of the United States, expressly rejects this. He says, it wasn't the states that ratified the Constitution. It was the people that ratified the Constitution. So it's not state governments that are sovereign, but it's the people of the United States who are sovereign. Now I think this is a wonderful, romantic notion, but I'm not sure it's true. Article VII of the Constitution says that the Constitution will be valid when three-quarters of the states ratified it. Was it really the people who ratified it? There was no national plebiscite, no national referendum on the Constitution. But here John Marshall unequivocally says, the Court unequivocally declares, it's the United States government that has the sovereignty vested in it by the people. It's not the states that are sovereign. This has been important at times in American history. There have been times when states have wanted to resist what the United States government is doing, and they wanted to claim that the Constitution is just a compact among the states, and the states are sovereign. John Calhoun wanted to oppose the abolition of slavery on this basis. Southerners in the 1950s and 60s wanted to oppose desegregation by proclaiming the states are sovereign. McCullough versus Maryland rejects that. Still talking about the authority of Congress to create the Bank of the United States, John Marshall then says, Congress has all powers that are not prohibited to carry out its authority under the Constitution. It's here that John Marshall says we must never forget that it's the Constitution we're expounding. He says the Constitution doesn't have, and I'll quote his word, the prolixity, the detail of a statute. He says the Constitution is just meant to be the outlines of what the government can do. And he says so long as Congress has a power, it can choose any means not prohibited to carry out that power. And having said that, he finally, in discussing Congress' power to create the Bank of the United States, talks about a clause in Article I, Section 8 called the Necessary and Proper Clause. This provision in Article I, Section 8 of the Constitution says that Congress can take all actions that are necessary and proper to carry out its authority. Now, what the state of Maryland argued here was that the Necessary and Proper Clause means that Congress can just do those things that are necessary in the sense of essential to carrying out its power. Usually when the word necessary comes up in constitutional law, that's when it means essential. But John Marshall says no. John Marshall says the Necessary and Proper Clause just means that Congress has to show that its action is beneficial, is helpful to carrying out its power. He says the Necessary and Proper Clause is found in Article I, Section 8, which is the powers of Congress, not Article I, Section 9, which are the limits on Congress' power. It's meant to enlarge Congress' power, not to restrict it. So notice that Marshall says even if we're getting the Necessary and Proper Clause, Congress can chose any means not prohibited by the Constitution to carry out its powers, and he says the Necessary and Proper Clause confirms that, does not limit it. Why does this matter so much? We'll take an example, a power Congress has under Article I, Section 8, the authority to raise the army and the navy. Think to yourself for a moment, of all of the things that the Congress might do as a way to raise an army and a navy. It might create a military draft. It might create military bases. It might create pay for the voluntary army. Gosh, Congress could create a national bake sale to fund the army and the navy. None of those things, or all of an infinite list of others, are mentioned in the Constitution. Never does the Constitution say that Congress can have a draft. Never does it say it can have a national bake sale. But Congress can do all of these things as means not prohibited by the Constitution. And Congress doesn't have to prove, unless its government has established that these are essential, that they're the only way to do it. Congress just has to show that they're helpful, beneficial way. This is a tremendous expansion of Congress' power. Congress can do literally anything that's not prohibited by the Constitution to carry out its authority. And so the Supreme Court concludes Congress has the authority to create the Bank of the United States. Having done that, John Marshall then goes on to the second question. Is the states' tax on the Bank of the United States constitutional? And I think so persuasively established that Congress had the power to create the bank, it's relatively easy for the Supreme Court to explain why the tax is unconstitutional. John Marshal, writing for the court, says the power to tax is the power to destroy. If states could tax the Bank of the United States, they could tax it out of existence. He says the power to create has to imply the power to preserve. So the state taxing the Bank of the United States is acting in a way that's incompatible with Congress' authority. Now the state could argue this is a small tax by the state of Maryland on the tax of the United States. It wasn't going to tax it out of existence. But the Supreme Court says it's not appropriate to let one state tax what in essence is the money from other states. That when Maryland is taking the Bank of the United States, it's taxing money that's coming from Massachusetts and New York, and those aren't people who have representation in the Maryland political process. It's wrong for Maryland to be able to impose a tax on people from other states who don't have representation in the Maryland state legislature. John Marshall says, we can't just put confidence in the state governments and trust in them. We can't give them a power that's inconsistent with the existence of the national government. So notice what McCullough versus Maryland does. It very broadly defined the scope of Congress' power. Congress can now do anything that it finds to be useful in carrying out its authority so long as it's not an action prohibited by the Constitution. And McCullough versus Maryland says there's a limit on what the states could do. States cannot act in a manner that's inconsistent with the existence of the national government. And to this day, states cannot tax the federal government. States can not regulate the federal government in a way that put a substantial burden on federal activity. And these are principles that comes from McCullough versus Maryland.
