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previous | Annotations p. 26 | next
Clause 1. Power to Tax and Spend
By the terms of the Constitution, the power of Congress to levy taxes is subject to but one exception and two qualifications. Articles exported from any State may not be taxed at all. Direct taxes must be levied by the rule of apportionment and indirect taxes by the rule of uniformity. The Court has emphasized the sweeping character of this power by saying from time to time that it ''reaches every subject,'' 469 that it is ''exhaustive'' 470 or that it ''embraces every conceivable power of taxation.'' 471 Despite these generalizations, the power has been at times substantially curtailed by judicial decision with respect to the subject matter of taxation, the manner in which taxes are imposed, and the objects for which they may be levied.
Decline of the Forbidden Subject Matter Test .--In recent years the Supreme Court has restored to Congress the power to tax most of the subject matter which had previously been withdrawn from its reach by judicial decision. The holding of Evans v. Gore 472 and Miles v. Graham 473 that the inclusion of the salaries received by federal judges in measuring the liability for a nondiscriminatory income tax violated the constitutional mandate that the compensation of such judges should not be diminished during their continuance in office was repudiated in O'Malley v. Woodrough. 474 The specific ruling of Collector v. Day 475 that the salary of a state officer is immune to federal income taxation also has been overruled. 476 But the principle underlying that decision--that Congress may not lay a tax which would impair the sovereignty of the States--is still recognized as retaining some vitality. 477
Federal Taxation of State Interests .--In 1903 a succession tax upon a bequest to a municipality for public purposes was upheld on the ground that the tax was payable out of the estate before distribution to the legatee. Looking to form and not to substance, in disregard of the mandate of Brown v. Maryland, 478 a closely divided Court declined to ''regard it as a tax upon the municipality, though it might operate incidentally to reduce the be quest by the amount of the tax.'' 479 When South Carolina embarked upon the business of dispensing alcoholic beverages, its agents were held to be subject to the national internal revenue tax, the ground of the holding being that in 1787 such a business was not regarded as one of the ordinary functions of government. 480
Another decision marking a clear departure from the logic of Collector v. Day was Flint v. Stone Tracy Co., 481 where the Court sustained an act of Congress taxing the privilege of doing business as a corporation, the tax being measured by the income. The argument that the tax imposed an unconstitutional burden on the exercise by a State of its reserved power to create corporate franchises was rejected, partly in consideration of the principle of national supremacy, and partly on the ground that the corporate franchises were private property. This case also qualified Pollock v. Farmers' Loan & Trust Company to the extent of allowing interest on state bonds to be included in measuring the tax on the corporation.
Subsequent cases have sustained an estate tax on the net estate of a decedent, including state bonds, 482 excise taxes on the transportation of merchandise in performance of a contract to sell and deliver it to a county, 483 on the importation of scientific apparatus by a state university, 484 on admissions to athletic contests sponsored by a state institution, the net proceeds of which were used to further its educational program, 485 and on admissions to recreational facilities operated on a nonprofit basis by a municipal corporation. 486 Income derived by independent engineering contractors from the performance of state functions, 487 the compensation of trustees appointed to manage a street railway taken over and operated by a State, 488 profits derived from the sale of state bonds, 489 or from oil produced by lessees of state lands, 490 have all been held to be subject to federal taxation despite a possible economic burden on the State.
In finally overruling Pollock, the Court stated that Pollock had ''merely represented one application of the more general rule that neither the federal nor the state governments could tax income an individual directly derived from any contract with another government.'' 491 That rule, the Court observed, had already been rejected in numerous decisions involving intergovernmental immunity. ''We see no constitutional reason for treating persons who receive interest on governmental bonds differently than persons who receive income from other types of contracts with the government, and no tenable rationale for distinguishing the costs imposed on States by a tax on state bond interest from the costs imposed by a tax on the income from any other state contract.'' 492
Scope of State Immunity From Federal Taxation .--Although there have been sharp differences of opinion among members of the Supreme Court in cases dealing with the tax immunity of state functions and instrumentalities, it has been stated that ''all agree that not all of the former immunity is gone.'' 493 Twice, the Court has made an effort to express its new point of view in a statement of general principles by which the right to such immunity shall be determined. However, the failure to muster a majority in concurrence with any single opinion in the latter case leaves the question very much in doubt. In Helvering v. Gerhardt, 494 where, without overruling Collector v. Day, it narrowed the immunity of salaries of state officers from federal income taxation, the Court announced ''two guiding principles of limitation for holding the tax immunity of State instrumentalities to its proper function. The one, dependent upon the nature of the function being performed by the State or in its behalf, excludes from the immunity activities thought not to be essential to the preservation of State governments even though the tax be collected from the State treasury. . . . The other principle, exemplified by those cases where the tax laid upon individuals affects the State only as the burden is passed on to it by the taxpayer, forbids recognition of the immunity when the burden on the State is so speculative and uncertain that if allowed it would restrict the federal taxing power without affording any corresponding tangible protection to the State government; even though the function be thought important enough to demand immunity from a tax upon the State itself, it is not necessarily protected from a tax which well may be substantially or entirely absorbed by private persons.'' 495
The second attempt to formulate a general doctrine was made in New York v. United States, 496 where, on review of a judgment affirming the right of the United States to tax the sale of mineral waters taken from property owned and operated by the State of New York, the Court reconsidered the right of Congress to tax business enterprises carried on by the States. Justice Frankfurter, speaking for himself and Justice Rutledge, made the question of discrimination vel non against state activities the test of the validity of such a tax. They found ''no restriction upon Congress to include the States in levying a tax exacted equally from private persons upon the same subject matter.'' 497 In a concurring opinion in which Justices Reed, Murphy, and Burton joined, Chief Justice Stone rejected the criterion of discrimination. He repeated what he had said in an earlier case to the effect that ''the limitation upon the taxing power of each, so far as it affects the other, must receive a practical construction which permits both to function with the minimum of interference each with the other; and that limitation cannot be so varied or extended as seriously to impair either the taxing power of the government imposing the tax . . . or the appropriate exercise of the functions of the government affected by it.'' 498 Justices Douglas and Black dissented in an opinion written by the former on the ground that the decision disregarded the Tenth Amendment, placed ''the sovereign States on the same plane as private citizens,'' and made them ''pay the Federal Government for the privilege of exercising powers of sovereignty guaranteed them by the Constitution.'' 499 In a later case dealing with state immunity the Court sustained the tax on the second ground mentioned in Helvering v. Gerhardt--that the burden of the tax was borne by private persons--and did not consider whether the function was one which the Federal Government might have taxed if the municipality had borne the burden of the exaction. 500
Articulation of the current approach may be found in South Carolina v. Baker. 501 The rules are ''essentially the same'' for federal immunity from state taxation and for state immunity from federal taxation, except that some state activities may be subject to direct federal taxation, while States may ''never'' tax the United States directly. Either government may tax private parties doing business with the other government, ''even though the financial burden falls on the [other government], as long as the tax does not discriminate against the [other government] or those with which it deals.'' 502 Thus, ''the issue whether a nondiscriminatory federal tax might nonetheless violate state tax immunity does not even arise unless the Federal Government seeks to collect the tax directly from a State.'' 503
Uniformity Requirement .--Whether a tax is to be apportioned among the States according to the census taken pursuant to Article I, Sec. 2, or imposed uniformly throughout the United States depends upon its classification as direct or indirect. 504 The rule of uniformity for indirect taxes is easy to obey. It exacts only that the subject matter of a levy be taxed at the same rate wherever found in the United States; or, as it is sometimes phrased, the uniformity required is ''geographical,'' not ''intrinsic.'' 505 Even the geographical limitation is a loose one, at least if United States v. Ptasynski 506 is followed. There, the Court upheld an exemption from a crude-oil windfall-profits tax of ''Alaskan oil,'' defined geographically to include oil produced in Alaska (or elsewhere) north of the Arctic Circle. What is prohibited, the Court said, is favoritism to particular States in the absence of valid bases of classification. Because Congress could have achieved the same result, allowing for severe climactic difficulties, through a classification tailored to the ''disproportionate costs and difficulties . . . associated with extracting oil from this region,'' 507 the fact that Congress described the exemption in geographic terms did not condemn the provision.
The clause accordingly places no obstacle in the way of legislative classification for the purpose of taxation, nor in the way of what is called progressive taxation. 508 A taxing statute does not fail of the prescribed uniformity because its operation and incidence may be affected by differences in state laws. 509 A federal estate tax law which permitted deduction for a like tax paid to a State was not rendered invalid by the fact that one State levied no such tax. 510 The term ''United States'' in this clause refers only to the States of the Union, the District of Columbia, and incorporated territories. Congress is not bound by the rule of uniformity in framing tax measures for unincorporated territories. 511 Indeed, in Binns v. United States, 512 the Court sustained license taxes imposed by Congress but applicable only in Alaska, where the proceeds, although paid into the general fund of the Treasury, did not in fact equal the total cost of maintaining the territorial government.
The discretion of Congress in selecting the objectives of taxation has also been held at times to be subject to limitations implied from the nature of the Federal System. Apart from matters that Congress is authorized to regulate, the national taxing power, it has been said, ''reaches only existing subjects.'' 513 Congress may tax any activity actually carried on, such as the business of accepting wagers, 514 regardless of whether it is permitted or prohibited by the laws of the United States 515 or by those of a State. 516 But so- called federal ''licenses,'' so far as they relate to trade within state limits, merely express, ''the purpose of the government not to interfere . . . with the trade nominally licensed, if the required taxes are paid.'' Whether the ''licensed'' trade shall be permitted at all is a question for decision by the State. 517 This, nevertheless, does not signify that Congress may not often regulate to some extent a business within a State in order to tax it more effectively. Under the necessary- and-proper clause, Congress may do this very thing. Not only has the Court sustained regulations concerning the packaging of taxed articles such as tobacco 518 and oleomargarine, 519 ostensibly designed to prevent fraud in the collection of the tax, it has also upheld measures taxing drugs 520 and fire arms, 521 which prescribed rigorous restrictions under which such articles could be sold or transferred, and imposed heavy penalties upon persons dealing with them in any other way. These regulations were sustained as conducive to the efficient collection of the tax though they clearly transcended in some respects this ground of justification. 522
A problem of a different order is presented where the tax itself has the effect of suppressing an activity or where it is coupled with regulations that clearly have no possible relation to the collection of the tax. Where a tax is imposed unconditionally, so that no other purpose appears on the face of the statute, the Court has refused to inquire into the motives of the lawmakers and has sustained the tax despite its prohibitive proportions. 523 ''It is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely deters the activities taxed. . . . The principle applies even though the revenue obtained is obviously negligible . . . or the revenue purpose of the tax may be secondary. . . . Nor does a tax statute necessarily fall because it touches on activities which Congress might not otherwise regulate. As was pointed out in Magnano Co. v. Hamilton, 292 U.S. 40, 47 (1934): 'From the beginning of our government, the courts have sustained taxes although imposed with the collateral intent of effecting ulterior ends which, considered apart, were beyond the constitutional power of the lawmakers to realize by legislation directly addressed to their accomplishments.''' 524
But where the tax is conditional, and may be avoided by compliance with regulations set out in the statute, the validity of the measure is determined by the power of Congress to regulate the subject matter. If the regulations are within the competence of Congress, apart from its power to tax, the exaction is sustained as an appropriate sanction for making them effective; 525 otherwise it is invalid. 526 During the Prohibition Era, Congress levied a heavy tax upon liquor dealers who operated in violation of state law. In United States v. Constantine, 527 the Court held that this tax was unenforceable after the repeal of the Eighteenth Amendment, since the National Government had no power to impose an additional penalty for infractions of state law.
Promotion of Business: Protective Tariff
The earliest examples of taxes levied with a view to promoting desired economic objectives in addition to raising revenue were, of course, import duties. The second statute adopted by the first Congress was a tariff act reciting that ''it is necessary for the support of government, for the discharge of the debts of the United States, and the encouragement and protection of manufactures, that duties be laid on goods, wares and merchandise imported.'' 528 After being debated for nearly a century and a half, the constitutionality of protective tariffs was finally settled by the unanimous decision of the Supreme Court in J. W. Hampton & Co. v. United States, 529 where Chief Justice Taft wrote: ''The second objection to Sec. 315 is that the declared plan of Congress, either expressly or by clear implication, formulates its rule to guide the President and his advisory Tariff Commission as one directed to a tariff system of protection that will avoid damaging competition to the country's industries by the importation of goods from other countries at too low a rate to equalize foreign and domestic competition in the markets of the United States. It is contended that the only power of Congress in the levying of customs duties is to create revenue, and that it is unconstitutional to frame the customs duties with any other view than that of revenue raising.''
The Chief Justice then observed that the first Congress in 1789 had enacted a protective tariff. ''In this first Congress sat many members of the Constitutional Convention of 1787. This Court has repeatedly laid down the principle that a contemporaneous legislative exposition of the Constitution when the founders of our Government and framers of our Constitution were actively participating in public affairs, long acquiesced in, fixes the construction to be given its provisions. . . . The enactment and enforcement of a number of customs revenue laws drawn with a motive of maintaining a system of protection, since the revenue law of 1789, are mat ters of history. . . . Whatever we may think of the wisdom of a protection policy, we cannot hold it unconstitutional. So long as the motive of Congress and the effect of its legislative action are to secure revenue for the benefit of the general government, the existence of other motives in the selection of the subject of taxes cannot invalidate Congressional action.'' 530
SPENDING FOR THE GENERAL WELFARE
The grant of power to ''provide . . . for the general welfare'' raises a two-fold question: How may Congress provide for ''the general welfare'' and what is ''the general welfare'' that it is authorized to promote? The first half of this question was answered by Thomas Jefferson in his opinion on the Bank as follows: ''[T]he laying of taxes is the power, and the general welfare the purpose for which the power is to be exercised. They [Congress] are not to lay taxes ad libitum for any purpose they please; but only to pay the debts or provide for the welfare of the Union. In like manner, they are not to do anything they please to provide for the general welfare, but only to lay taxes for that purpose.'' 531 The clause, in short, is not an independent grant of power, but a qualification of the taxing power. Although a broader view has been occasionally asserted, 532 Congress has not acted upon it and the Court has had no occasion to adjudicate the point.
With respect to the meaning of ''the general welfare'' the pages of The Federalist itself disclose a sharp divergence of views between its two principal authors. Hamilton adopted the literal, broad meaning of the clause; 533 Madison contended that the powers of taxation and appropriation of the proposed government should be regarded as merely instrumental to its remaining powers, in other words, as little more than a power of self-support. 534 From an early date Congress has acted upon the interpretation espoused by Hamilton. Appropriations for subsidies 535 and for an ever increasing variety of ''internal improvements'' 536 constructed by the Federal Government, had their beginnings in the adminis trations of Washington and Jefferson. 537 Since 1914, federal grants- in-aid, sums of money apportioned among the States for particular uses, often conditioned upon the duplication of the sums by the recipient State, and upon observance of stipulated restrictions as to its use, have become commonplace.
The scope of the national spending power was brought before the Supreme Court at least five times prior to 1936, but the Court disposed of four of the suits without construing the ''general welfare'' clause. In the Pacific Railway Cases (California v. Pacific Railroad Co.) 538 and Smith v. Kansas City Title Co., 539 it affirmed the power of Congress to construct internal improvements, and to charter and purchase the capital stock of federal land banks, by reference to the powers of the National Government over commerce, and post roads and fiscal operations, and to its war powers. Decisions on the merits were withheld in two other cases, Massachusetts v. Mellon and Frothingham v. Mellon, 540 on the ground that neither a State nor an individual citizen is entitled to a remedy in the courts against an alleged unconstitutional appropriation of national funds. In United States v. Gettysburg Electric Ry., 541 however, the Court had invoked ''the great power of taxation to be exercised for the common defence and general welfare'' 542 to sustain the right of the Federal Government to acquire land within a State for use as a national park.
Finally, in United States v. Butler, 543 the Court gave its unqualified endorsement to Hamilton's views on the taxing power. Wrote Justice Roberts for the Court: ''Since the foundation of the Nation sharp differences of opinion have persisted as to the true interpretation of the phrase. Madison asserted it amounted to no more than a reference to the other powers enumerated in the subsequent clauses of the same section; that, as the United States is a government of limited and enumerated powers, the grant of power to tax and spend for the general national welfare must be confined to the numerated legislative fields committed to the Congress. In this view the phrase is mere tautology, for taxation and appropriation are or may be necessary incidents of the exercise of any of the enumerated legislative powers. Hamilton, on the other hand, maintained the clause confers a power separate and distinct from those later enumerated, is not restricted in meaning by the grant of them, and Congress consequently has a substantive power to tax and to appropriate, limited only by the requirement that it shall be exercised to provide for the general welfare of the United States. Each contention has had the support of those whose views are entitled to weight. This court had noticed the question, but has never found it necessary to decide which is the true construction. Justice Story, in his Commentaries, espouses the Hamiltonian position. We shall not review the writings of public men and commentators or discuss the legislative practice. Study of all these leads us to conclude that the reading advocated by Justice Story is the correct one. While, therefore, the power to tax is not unlimited, its confines are set in the clause which confers it, and not in those of Sec. 8 which bestow and define the legislative powers of the Congress. It results that the power of Congress to authorize expenditure of public moneys for public purposes is not limited by the direct grants of legislative power found in the Constitution.'' 544
Social Security Act Cases .--Although holding that the spending power is not limited by the specific grants of power contained in Article I, Sec. 8, the Court found, nevertheless, that it was qualified by the Tenth Amendment, and on this ground ruled in the Butler case that Congress could not use moneys raised by taxation to ''purchase compliance'' with regulations ''of matters of State concern with respect to which Congress has no authority to interfere.'' 545 Within little more than a year this decision was reduced to narrow proportions by Steward Machine Co. v. Davis, 546 which sustained the tax imposed on employers to provide unemployment benefits, and the credit allowed for similar taxes paid to a State. To the argument that the tax and credit in combination were ''weapons of coercion, destroying or impairing the autonomy of the States,'' the Court replied that relief of unemployment was a legitimate object of federal expenditure under the ''general welfare'' clause, that the Social Security Act represented a legitimate attempt to solve the problem by the cooperation of State and Federal Governments, that the credit allowed for state taxes bore a reasonable relation ''to the fiscal need subserved by the tax in its normal operation,'' 547 since state unemployment compensation payments would relieve the burden for direct relief borne by the national treasury. The Court reserved judgment as to the validity of a tax ''if it is laid upon the condition that a State may escape its operation through the adoption of a statute unrelated in subject matter to activities fairly within the scope of national policy and power.'' 548
An Unrestrained Federal Spending Power .--Little if any constitutional controversy marks the debate over the modern exercise of the spending power. There are, of course, ''general restrictions,'' the first of which is that the power must be used in pursuit of the general welfare. 549 However, great deference is judicially accorded Congress' decision that a spending program advances the general welfare, 550 and the Court has suggested that the question whether a spending program provides for the general welfare may not even be judicially noticeable. 551 Dispute, such as it is, turns on the conditioning of funds.
Conditional Grants-in-Aid .--In the Steward Machine Company case, it was a taxpayer who complained of the invasion of the state sovereignty, and the Court put great emphasis on the fact that the State was a willing partner in the plan of cooperation embodied in the Social Security Act. 552 A decade later the right of Congress to impose conditions upon grants-in-aid over the objection of a State was squarely presented in Oklahoma v. CSC. 553 The State objected to the enforcement of a provision of the Hatch Act, whereby its right to receive federal highway funds would be diminished in consequence of its failure to remove from office a member of the State Highway Commission found to have taken an active part in party politics while in office. Although it found that the State had asserted a legal right which entitled it to an adjudication of its objection, the Court denied the relief sought on the ground that ''[w]hile the United States is not concerned with, and has no power to regulate local political activities as such of State officials, it does have power to fix the terms upon which its money allotments to State shall be disbursed. . . . The end sought by Congress through the Hatch Act is better public service by requiring those who administer funds for national needs to abstain from active political partisanship. So even though the action taken by Congress does have effect upon certain activities within the State, it has never been thought that such effect made the federal act invalid.'' 554
''Congress has frequently employed the Spending Power to further broad policy objectives by conditioning receipt of federal moneys upon compliance by the recipient with federal statutory and administrative directives. This Court has repeatedly upheld against constitutional challenge the use of this technique to induce governments and private parties to cooperate voluntarily with federal policy.'' 555 Standards purporting to channel Congress' discretion have been announced by the Court, but they amount to little more than hortatory admonitions. 556 First, the conditions, like the spending itself, must advance the general welfare, but the decision of that rests largely if not wholly with Congress. 557 Second, since the States may choose to receive or not receive the proffered funds, Congress must set out the conditions unambiguously, so that the States may rationally decide. 558 Third, it is suggested in the cases that the conditions must be related to the federal interest for which the funds are expended, 559 but, though it continues to repeat this standard, it has never found a spending condition that did not survive scrutiny under this part of the test. 560 Fourth, the power to condition funds may not be used to induce the States to engage in activities that would themselves be unconstitutional. 561 Fifth, the Court has suggested that in some circumstances the financial inducement offered by Congress might be so coercive as to pass the point at which ''pressure turns into compulsion,'' 562 but again the Court has never found a congressional condition to be coercive in this sense. 563 Certain federalism restraints on other federal powers seem not to be relevant to spending conditions. 564
If a State accepts federal funds on conditions and then fails to follow the requirements, the usual remedy is federal administrative action to terminate the funding and to recoup funds the State has already received. 565 But it is also clear that recipients and potential recipients in a particular program may ordinarily sue to compel the States to observe the standards. 566 Finally, it should be noted that Congress has enacted a range of laws forbidding discrimination in federal assistance programs, that has considerable effect. 567
Earmarked Funds .--The appropriation of the proceeds of a tax to a specific use does not affect the validity of the exaction, if the general welfare is advanced and no other constitutional provision is violated. Thus a processing tax on coconut oil was sustained despite the fact that the tax collected upon oil of Philippine production was segregated and paid into the Philippine Treasury. 568 In Helvering v. Davis, 569 the excise tax on employers, the proceeds of which were not earmarked in any way, although intended to provide funds for payments to retired workers, was upheld under the ''general welfare'' clause, the Tenth Amendment being found to be inapplicable.
Debts of the United States .--The power to pay the debts of the United States is broad enough to include claims of citizens aris ing on obligations of right and justice. 570 The Court sustained an act of Congress which set apart for the use of the Philippine Islands, the revenue from a processing tax on coconut oil of Philippine production, as being in pursuance of a moral obligation to protect and promote the welfare of the people of the Islands. 571 Curiously enough, this power was first invoked to assist the United States to collect a debt due to it. In United States v. Fisher, 572 the Supreme Court sustained a statute which gave the Federal Government priority in the distribution of the estates of its insolvent debtors. The debtor in that case was the endorser of a foreign bill of exchange that apparently had been purchased by the United States. Invoking the ''necessary and proper'' clause, Chief Justice Marshall deduced the power to collect a debt from the power to pay its obligations by the following reasoning: ''The government is to pay the debt of the Union, and must be authorized to use the means which appear to itself most eligible to effect that object. It has, consequently, a right to make remittances by bills or otherwise, and to take those precautions which will render the transaction safe.'' 573
Footnotes
[Footnote 469] License Tax Cases, 72 U.S. (5 Wall.) 462, 471 (1867).
[Footnote 470] Brushaber v. Union Pacific R. Co., 240 U.S. 1 (1916).
[Footnote 471] Id., 12.
[Footnote 472] 253 U.S. 245 (1920).
[Footnote 473] 268 U.S. 501 (1925).
[Footnote 474] 307 U.S. 277 (1939).
[Footnote 475] 78 U.S. (11 Wall.) 113 (1871).
[Footnote 476] Graves v. New York ex rel. O'Keefe, 306 U.S. 466 (1939). Collector v. Day was decided in 1871 while the country was still in the throes of Reconstruction. As noted by Chief Justice Stone in a footnote to his opinion in Helvering v. Gerhardt, 304 U.S. 405, 414 n. 4 (1938), the Court had not determined how far the Civil War Amendments had broadened the federal power at the expense of the States, but the fact that the taxing power had recently been used with destructive effect upon notes issued by the state banks, Veazie Bank v. Fenno, 75 U.S. (8 Wall.) 533 (1869), suggested the possibility of similar attacks upon the existence of the States themselves. Two years later, the Court took the logical step of holding that the federal income tax could not be imposed on income received by a municipal corporation from its investments. United States v. Railroad Company, 84 U.S. (17 Wall.) 322 (1873). A far- reaching extension of private immunity was granted in Pollock v. Farmers' Loan & Trust Co., 157 U.S. 429 (1895), where interest received by a private investor on state or municipal bonds was held to be exempt from federal taxation. (Though relegated to virtual desuetude, Pollock was not expressly overruled until South Carolina v. Baker, 485 U.S. 505 (1988)). As the apprehension of this era subsided, the doctrine of these cases was pushed into the background. It never received the same wide application as did McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819), in curbing the power of the States to tax operations or instrumentalities of the Federal Government. Only once since the turn of the century has the national taxing power been further narrowed in the name of dual federalism. In 1931 the Court held that a federal excise tax was inapplicable to the manufacture and sale to a municipal corporation of equipment for its police force. Indian Motorcycle v. United States, 283 U.S. 570 (1931). Justice Stone and Brandeis dissented from this decision, and it is doubtful whether it would be followed today. Cf. Massachusetts v. United States, 435 U.S. 444 (1978).
[Footnote 477] At least, if the various opinions in New York v. United States, 326 U.S. 572 (1946), retain force, and they may in view of (a later) New York v. United States, 112 S.Ct. 2408 (1992), a commerce clause case rather than a tax case.
[Footnote 478] 25 U.S. (12 Wheat.) 419, 444 (1827).
[Footnote 479] Snyder v. Bettman, 190 U.S. 249, 254 (1903).
[Footnote 480] South Carolina v. United States, 199 U.S. 437 (1905). See also Ohio v. Helvering, 292 U.S. 360 (1934).
[Footnote 481] 220 U.S. 107 (1911).
[Footnote 482] Greiner v. Lewellyn, 258 U.S. 384 (1922).
[Footnote 483] Wheeler Lumber Co. v. United States, 281 U.S. 572 (1930).
[Footnote 484] Board of Trustees v. United States, 289 U.S. 48 (1933).
[Footnote 485] Allen v. Regents, 304 U.S. 439 (1938).
[Footnote 486] Wilmette Park Dist. v. Campbell, 338 U.S. 411 (1949).
[Footnote 487] Metcalf & Eddy v. Mitchell, 269 U.S. 514 (1926).
[Footnote 488] Helvering v. Powers, 293 U.S. 214 (1934).
[Footnote 489] Willcuts v. Bunn, 282 U.S. 216 (1931).
[Footnote 490] Helvering v. Producers Corp., 303 U.S. 376 (1938), overruling Burnet v. Coronado Oil & Gas Co., 285 U.S. 393 (1932).
[Footnote 491] South Carolina v. Baker, 485 U.S. 505, 517 (1988).
[Footnote 492] Id., 524.
[Footnote 493] New York v. United States, 326 U.S. 572, 584 (1946) (concurring opinion of Justice Rutledge).
[Footnote 494] 304 U.S. 405 (1938).
[Footnote 495] Id., 419-420.
[Footnote 496] 326 U.S. 572 (1946).
[Footnote 497] Id., 584.
[Footnote 498] Id., 589-590.
[Footnote 499] Id., 596.
[Footnote 500] Wilmette Park Dist. v. Campbell, 338 U.S. 411 (1949). Cf. Massachusetts v. United States, 435 U.S. 444 (1978).
[Footnote 501] 485 U.S. 505 (1988).
[Footnote 502] Id., 523.
[Footnote 503] Id., 524 n. 14.
[Footnote 504] See also Article I, Sec. 9, cl. 4.
[Footnote 505] LaBelle Iron Works v. United States, 256 U.S. 377 (1921); Brushaber v. Union Pacific R. Co., 240 U.S. 1 (1916); Head Money Cases, 112 U.S. 580 (1884).
[Footnote 506] 462 U.S. 74 (1983).
[Footnote 507] Id., 85.
[Footnote 508] Knowlton v. Moore, 178 U.S. 41 (1900).
[Footnote 509] Fernandez v. Wiener, 326 U.S. 340 (1945); Riggs v. Del Drago, 317 U.S. 95 (1942); Phillips v. Commissioner, 283 U.S. 589 (1931); Poe v. Seaborn, 282 U.S. 101, 117 (1930).
[Footnote 510] Florida v. Mellon, 273 U.S. 12 (1927).
[Footnote 511] Downes v. Bidwell, 182 U.S. 244 (1901).
[Footnote 512] 194 U.S. 486 (1904). The Court recognized that Alaska was an incorporated territory but took the position that the situation in substance was the same as if the taxes had been directly imposed by a territorial legislature for the support of the local government.
[Footnote 513] License Tax Cases, 72 U.S. (5 Wall.) 462, 471 (1867).
[Footnote 514] United States v. Kahriger, 345 U.S. 22 (1953). Dissenting, Justice Frankfurter maintained that this was not a bona fide tax, but was essentially an effort to check, if not stamp out, professional gambling, an activity left to the responsibility of the States. Justices Jackson and Douglas noted partial agreement with this conclusion. See also Lewis v. United States, 348 U.S. 419 (1955).
[Footnote 515] United States v. Yuginovich, 256 U.S. 450 (1921).
[Footnote 516] United States v. Constantine, 296 U.S. 287, 293 (1935).
[Footnote 517] License Tax Cases, 72 U.S. (5 Wall.) 462, 471 (1867).
[Footnote 518] Felsenheld v. United States, 186 U.S. 126 (1902).
[Footnote 519] In re Kollock, 165 U.S. 526 (1897).
[Footnote 520] United States v. Doremus, 249 U.S. 86 (1919). Cf. Nigro v. United States, 276 U.S. 332 (1928).
[Footnote 521] Sonzinsky v. United States, 300 U.S. 506 (1937).
[Footnote 522] Without casting doubt on the ability of Congress to regulate or punish through its taxing power, the Court has overruled Kahriger, Lewis, Doremus, Sonzinsky, and similar cases on the ground that the statutory scheme compelled self-incrimination through registration. Marchetti v. United States, 390 U.S. 39 (1968); Grosso v. United States, 390 U.S. 62 (1968); Haynes v. United States, 390 U.S. 85 (1968); Leary v. United States, 395 U.S. 6 (1969).
[Footnote 523] McCray v. United States, 195 U.S. 27 (1904).
[Footnote 524] United States v. Sanchez, 340 U.S. 42, 44 (1950). See also Sonzinsky v. United States, 300 U.S. 506, 513 -514 (1937).
[Footnote 525] Sunshine Coal Co. v. Adkins, 310 U.S. 381, 383 (1940). See also Head Money Cases, 112 U.S. 580, 596 (1884).
[Footnote 526] Child Labor Tax Case (Bailey v. Drexel Furniture Co.), 259 U.S. 20 (1922); Hill v. Wallace, 259 U.S. 44 (1922); Helwig v. United States, 188 U.S. 605 (1903).
[Footnote 527] 296 U.S. 287 (1935).
[Footnote 528] 1 Stat. 24 (1789).
[Footnote 529] 276 U.S. 394 (1928).
[Footnote 530] Id., 411-412.
[Footnote 531] 3 Writings of Thomas Jefferson (Library Edition, 1904), 147-149.
[Footnote 532] See W. Crosskey, Politics and the Constitution in the History of the United States (Chicago: 1953).
[Footnote 533] The Federalist, Nos. 30 and 34 (J. Cooke ed. 1961) 187-193, 209-215.
[Footnote 534] Id., No. 41, 268-278.
[Footnote 535] 1 Stat. 229 (1792).
[Footnote 536] 2 Stat. 357 (1806).
[Footnote 537] In an advisory opinion, which it rendered for President Monroe at his request on the power of Congress to appropriate funds for public improvements, the Court answered that such appropriations might be properly made under the war and postal powers. See Albertsworth, Advisory Functions in the Supreme Court, 23 Geo. L. J. 643, 644-647 (1935). Monroe himself ultimately adopted the broadest view of the spending power, from which, however, he carefully excluded any element of regulatory or police power. See his Views of the President of the United States on the Subject of Internal Improvements, of May 4, 1822, 2 Messages and Papers of the Presidents (Richardson ed. 1906), 713-752.
[Footnote 538] 127 U.S. 1 (188).
[Footnote 539] 255 U.S. 180 (1921).
[Footnote 540] 262 U.S. 447 (1923). See also Alabama Power Co. v. Ickes, 302 U.S. 464 (1938). These cases were limited by Flast v. Cohen, 392 U.S. 83 (1968).
[Footnote 541] 160 U.S. 668 (1896).
[Footnote 542] Id., 681.
[Footnote 543] 297 U.S. 1 (1936). See also Cleveland v. United States, 323 U.S. 329 (1945).
[Footnote 544] United States v. Butler, 297 U.S. 1, 65 , 66 (1936). So settled is the issue that recent attacks on federal grants-in-aid omit any challenge on the broad level and rely on specific prohibitions, i.e., the religion clauses of the First Amendment. Flast v. Cohen, 392 U.S. 83 (1968); Tilton v. Richardson, 403 U.S. 672 (1971).
[Footnote 545] Justice Stone, speaking for himself and two other Justices, dissented on the ground that Congress was entitled when spending the national revenues for the ''general welfare'' to see to it that the country got its money's worth thereof, and that the condemned provisions were ''necessary and proper'' to that end. United States v. Butler, 297 U.S. 1, 84 -86 (1936).
[Footnote 546] 301 U.S. 548 (1937).
[Footnote 547] Id., 591.
[Footnote 548] Id., 590. See also Buckley v. Valeo, 424 U.S. 1, 90 -92 (1976); Fullilove v. Klutznick, 448 U.S. 448, 473 -475 (1980); Pennhurst State School & Hospital v. Halderman, 451 U.S. 1 (1981).
[Footnote 549] South Dakota v. Dole, 483 U.S. 203, 207 (1987).
[Footnote 550] Id., 207 (citing Helvering v. Davis, 301 U.S. 619, 640 , 645 (1937)).
[Footnote 551] Buckley v. Valeo, 424 U.S. 1, 90 -91 (1976).
[Footnote 552] 301 U.S. 548, 589 , 590 (1937).
[Footnote 553] 330 U.S. 127 (1947).
[Footnote 554] Id., 143.
[Footnote 555] Fullilove v. Klutznick, 448 U.S. 448, 474 (1980) (Chief Justice Burger announcing judgment of the Court).
[Footnote 556] See South Dakota v. Dole, 483 U.S. 203, 207 -212 (1987).
[Footnote 557] Id., 207. See supra, nn. 549-551.
[Footnote 558] Ibid. The requirement appeared in Pennhurst State School & Hosp. v. Halderman, 451 U.S. 1, 17 (1981). See also Atascadero State Hosp. v. Scanlon, 473 U.S. 234 (1985).
[Footnote 559] South Dakota v. Dole, 483 U.S. 203, 207 -208 (1987). See Steward Machine Co. v. Davis, 301 U.S. 548, 590 (1937); Ivanhoe Irrigation Dist. v. McCracken, 357 U.S. 275, 295 (1958).
[Footnote 560] The relationship in South Dakota v. Dole, 483 U.S. 203, 208 -209 (1987), in which Congress conditioned access to certain highway funds on establishing a 21-years-of-age drinking qualification was that the purpose of both funds and condition was safe interstate travel. The federal interest in Oklahoma v. CSC, 330 U.S. 127, 143 (1947), as we have noted, was assuring proper administration of federal highway funds.
[Footnote 561] South Dakota v. Dole, 483 U.S. 203, 210 -211 (1987).
[Footnote 562] Steward Machine Co. v. Davis, 301 U.S. 548, 589 -590 (1937); South Dakota v. Dole, 483 U.S. 203, 211 -212 (1987).
[Footnote 563] See North Carolina ex rel. Morrow v. Califano, 445 F.Supp. 532 (E.D.N.C. 1977) (three-judge court), affd. 435 U.S. 962 (1978).
[Footnote 564] South Dakota v. Dole, 483 U.S. 203, 210 (1987).
[Footnote 565] Bell v. New Jersey, 461 U.S. 773 (1983); Bennett v. New Jersey, 470 U.S. 632 (1985); Bennett v. Kentucky Dept. of Education, 470 U.S. 656 (1985).
[Footnote 566] E.g., King v. Smith, 392 U.S. 309 (1968); Rosado v. Wyman, 397 U.S. 397 (1970); Lau v. Nichols, 414 U.S. 563 (1974); Miller v. Youakim, 440 U.S. 125 (1979). Suits may be brought under 42 U.S.C. Sec. 1983, see Maine v. Thiboutot, 448 U.S. 1 (1980), although in some instances the statutory conferral of rights may be too imprecise or vague for judicial enforcement. Compare Suter v. Artist M., 112 S.Ct. 1360 (1992), with Wright v. Roanoke Redevelopment & Housing Auth., 479 U.S. 418 (1987).
[Footnote 567] E.g., Title VI of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000d; Title IX of the Educational Amendments of 1972, 20 U.S.C. Sec. 1681; Title V of the Rehabilitation Act of 1973, 29 U.S.C. Sec. 794.
[Footnote 568] Cincinnati Soap Co. v. United States, 301 U.S. 308 (1937).
[Footnote 569] 301 U.S. 619 (1937).
[Footnote 570] United States v. Realty Company, 163 U.S. 427 (1896); Pope v. United States, 323 U.S. 1, 9 (1944).
[Footnote 571] Cincinnati Soap Co. v. United States, 301 U.S. 308 (1937).
[Footnote 572] 6 U.S. (2 Cr.) 358 (1805).
[Footnote 573] Id., 396.
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