Constitutional Law – Spring 1999

(SFPIF – this was being forwarded around last year, I’m not sure who made it, but it looks like it is for Koppelman)

Federalism - Vertical distribution of government power a government of enumerated powers - Why does federalism matter?

• Why reserve powers to states?

• Promotes efficiency

• Promotes individual choice

• Encourages experimentation

• Promotes democracy

• Prevents tyranny

• Why unite into federations at all?

• Reduces threat of internal war

• Provides common defense, solves other collective action problems (tariffs) as AC conspicuously failed to do.

• Facilitates activities in which there are economics of scale (defense, research programs, highway system, redistribution)

• Promotes free flow of commerce (as AC failed to do)

• Regulates externalities that one state may impose on others.

• Protects individual human rights (14^th Amendment – No state can deny any one equal protection of laws)

• Why enumerated powers?

• At Philadelphia, Convention resolved that Congress could “legislate in all cases to which separate States are incompetent, or in which harmony of U.S. may be interrupted by exercise of individual legislation.”

• This was then translated by Committee of Detail into present Article I, § 8 (enumerated powers).

• Is Article I, § 8 an improvement from the resolution?

• Would functional definition of enumerated powers have been better than enumeration of those powers?

• How much of a limit is the enumeration of powers? Was Hamilton right (Federalist 84) that separation of powers is such a reliable limit that a Bill of Rights is unnecessary and potentially pernicious (because it implies powers beyond those enumerated)?

Implied powers - McCulloch V. Maryland – Bank of the u.S.

• Marshall 1819. Held that (1) Congress has the power to charter a bank, even though that power is not specifically enumerated in USC; (2) Maryland has no power to tax that bank.

• Doctrine of Implied Powers. Although the federal government may act only where it is affirmatively authorized to do so by USC, the authorization does not have to be explicit. That is, by the doctrine of “implied powers,” the federal government (especially Congress) may validly exercise power that is ancillary to one of the powers explicitly listed in the Constitution, so long as this ancillary power does not conflict with specific Constitutional prohibitions (e.g. those of the Bill of Rights).

• “Necessary and proper” clause. This notion of implied powers is itself explicitly stated in the “necessary and proper” clause of Art. I, §8: Congress may “make all Laws which shall be necessary and proper for carrying into Execution” the specific legislative powers granted by Art. I, §8, or by other parts of the USC. McCulloch was the first case to make an important interpretation of “necessary and proper.”

• Setting of McCulloch. Congress chartered the second Bank of the United States in 1816. The Bank was designed to regulate the currency and help solve national economic problems. However, it soon encountered substantial political opposition, mostly as the result of the Panic of 1818 and corruption within the various branches of the Bank. As a result, a number of states enacted anti-Bank measures.

• The Maryland Act. One of these anti-Bank statutes, enacted by Maryland, was at the center of the McCulloch dispute. Maryland imposed a tax upon all banks operating in the state that were not chartered by the state. The measure was intended to discriminate against the national bank, and its Maryland branch. The state then brought suit against the Bank and its cashier (McCulloch) to collect the tax. SCt held the tax constitutionally invalid in McCulloch.

• Structure of opinion. This opinion (one of most significant ever written by Marshall) had two main portions: (1) a determination that the chartering of the Bank was within the constitutionally-vested power of the federal government; and (2) a finding that since the Bank was constitutionally chartered, Maryland’s tax upon it was unconstitutional.

• Marshall’s use of text and other modes of argument (AK). Marshall did not strictly rely on text for either part of the decision. [the opinion here, like Hunter’s Lessee, was a lot more deferential to Congress than Marbury was.]

• Congressional power. Marshall did not say what enumerated powers the bank is “necessary and proper” for carrying out. Marshall started out with text, but then moved quickly to considerations of political theory and prudence. To extent that Marshall relied on original intent, he inferred it from these other considerations.

• State tax. There was no text prohibiting taxation of bank. The argument against the tax was purely structural.

• Constitutionality of the Bank. In concluding that the Bank was constitutionally chartered, Marshall first disposed of the Maryland’s argument that the powers of the national government were delegated to it by the states, and that these powers must be exercised in subordination to the states. Marshall concluded that the powers come directly from the people, not from the states qua states.

• Grant need not be explicit. Marshall then turned to the issue of whether the constitutional grant of the particular power (here, the power to charger a bank or a corporation) was required to be made explicitly in the USC. Marshall concluded that particular powers could be implied from the explicit grant of other powers: “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 partake of the prolixity of a legal code, and could scarcely be embraced by the human mind . . . . We must never forget that it is a constitution we are expounding.”

1. Corporation allowed. More specifically, Marshall found that Congress had the power to create a corporation (in this case, the Bank), if this was incidental to the carrying out of one of the constitutionally-enumerated powers, such as the power to raise revenue.

2. “Necessary and proper” clause. Marshall relied upon the “necessary and proper” clause as a justification for Congress’ right to create a bank or corporation even though such a power was not specifically granted in the USC. In perhaps the most significant part of the opinion, Marshall rejected the contention that “necessary” meant “absolutely necessary” or “indispensable.” Instead, he stated that: “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, [and which are consistent] with the letter and spirit of the constitution, are constitutional.”

1. Summary. Thus, so long as the means is rationally related to a constitutionally-specified object, the means is also constitutional (assuming that it does not violate any specific prohibition, such as those from Bill of Rights).

• Support for conclusion. To support his liberal interpretation of “necessary and proper,” Marshall pointed to a number of situations where Congress’ power to carry out constitutionally-specified objectives had been liberally interpreted. For instance, USC does not contain any specific grant of the power to punish the violation of federal laws, yet this power had always been inferred. Similarly, the power “to establish post offices and post roads” had been substantially expanded, to include the federal prohibition on mail theft. Yet these exercises of power could not be termed “indispensable” to a carrying out of the constitutionally-specified ends.

• Separation of powers rationale. Marshall also based his opinion upon separation-of-powers principles: An examination by the judicial branch into the “degree of necessity” justifying a statute would be an invasion of Congress’ domain. Thus Marshall felt that SCt should strike down a law as being beyond powers of Congress only where it was quite clear that no constitutionally-specified object was being pursued; in any closer case, the final decision should be left to Congress, not the courts.

• Conclusion. Marshall thus concluded that the act chartering the national bank was valid, because it bore a reasonable relationship to various constitutionally-enumerated powers of the government (e.g. the power to collect taxes, to borrow money, to regulate commerce, etc.)

• AK Critique:

• What is left of the idea of enumerated powers after this opinion? How reliable safeguard is the “pretext” proviso (64): “Should Congress . . . adopt measures which are prohibited by USC; or should Congress, under pretext of executing its powers, pass laws for accomplishment of objects not entrusted to government; it would become painful duty of this tribunal, should a case requiring such decision come before it, to say that such an act was not the law of the land. But where the law is not prohibited, and is really calculated to effect any of the objects entrusted to the government, to undertake here to inquire tint the degree of its necessity, would be to pass the line which circumscribes the judicial department, and to tread on legislative ground.”

• Why does Marshall think it important (58) to deny that USC emanated from sovereign states?

1. In constitutional interpretation, the framers’ intent is irrelevant to the extent that the ratifying states did not know about it. Ratifiers of the USC – the only people with the authority to make it into binding law – had no idea what went on in the Philadelphia Convention, and could not reasonably be said to have ratified a legislative history of which they were unaware.

• Federal immunity from state taxation. The Bank of the United States was immune from a Maryland tax against it. Marshall’s argument against the tax was purely structural.

• No taxation without representation.

1. USC structurally protects people from governmental abuse of powers by giving people control over government.

2. Tax is unconstitutional because citizens of other states (e.g. federal government) do not have power to remove state legislature if tax becomes onerous.

• Sovereignty argument; federal supremacy:

1. Federal government is supreme and cannot be controlled by subordinate sovereign institutions.

2. USC, and federal government, derive authority not from states, but rather from people. It is true that states have sovereignty, but people took some of that sovereignty away and vested it in federal government.

3. The power to tax is the power to destroy.

4. If state taxation were permitted to destroy or harm the Bank, the federal government’s exercise of its powers under USC (especially the “Necessary and Proper” Spending Clauses) would be thwarted.

5. The federal USC must be preserved against such state interference.

• Why is Maryland still allowed to tax the bank’s real property “in common with the other real property within the State”?

1. Evidently, because the interests of Maryland citizens are reflected in any such common tax; there are political safeguards here that make the legislative process more trustworthy than the one that produced a bank-specific tax.

2. This paragraph anticipated Ely’s representation-reinforcement theory, which we encounter repeatedly throughout the class.

Commerce clause

Three regulated categories under commerce clause

Channels

• Congress can regulate the use of the “channels” of interstate commerce. Thus Congress can regulate in a way that is reasonably related to highways, waterways, and air traffic. Presumably Congress can do so even though the activity in question in the particular case is quite intrastate.

Instrumentalities

• Congress can regulate the instrumentalities” of interstate commerce, “even though the threat may come only from intrastate activities.” Lopez. This category refers to people, machines, and other “things” used in carrying out commerce. So, for instance, presumably Congress could say that every truck must have a specific safety device, even if the particular truck in question was made and used exclusively within a single state.