M'culloch v. State of Maryland

The Constitution was adopted by the people, not merely by sovereign States acting as separate governments. Although the federal government has only enumerated powers, it is supreme within the sphere of powers the people granted to it.

The Court rejected the argument that Congress may exercise only powers expressly listed in the Constitution. Unlike the Articles of Confederation, the Tenth Amendment does not reserve only powers that were not "expressly" delegated. A constitution states broad objectives and powers; it cannot practically catalogue every subsidiary means necessary to execute them.

Congress's express powers to tax, borrow, regulate commerce, raise and support armed forces, and conduct national affairs carry with them authority to select suitable means for their execution. Incorporation is not an independent end like making war or levying taxes; it is a customary legal means for accomplishing authorized governmental objectives.

The Necessary and Proper Clause enlarges Congress's authority to implement its enumerated powers rather than narrowly restricting it. In this setting, "necessary" does not mean absolutely indispensable. It includes means that are useful, convenient, and plainly adapted to a legitimate constitutional end.

The governing rule is that when the end is legitimate and within the Constitution's scope, Congress may choose means that are appropriate, plainly adapted to that end, not prohibited by the Constitution, and consistent with its letter and spirit. A national bank was a useful and appropriate fiscal instrument for collecting, holding, transferring, borrowing, and disbursing federal funds.

The Court would invalidate a measure that Congress adopted as a pretext for pursuing an object outside its constitutional authority. But where the measure is genuinely calculated to carry out an entrusted power, courts do not decide whether Congress selected the most necessary or best possible means; that choice belongs to the legislature.

The Supremacy Clause makes the Constitution and federal laws enacted pursuant to it the supreme law of the land. That supremacy necessarily protects the lawful operations and instrumentalities through which the federal government executes its constitutional powers.

A power to create and preserve a federal instrument is incompatible with a State's power to destroy or burden that instrument. Because the power to tax includes the power to destroy, permitting Maryland to tax the Bank would allow one State to impair or defeat a national institution created for the benefit of the entire people.

Maryland's ordinary taxing power rests on its authority over its own people and property. But the Bank was created by the people of the United States through their federal government, not by Maryland's constituents alone. A single State therefore cannot claim sovereign authority over a federal means established to carry out national powers.

The Court refused to treat the case as one of confidence that States would use taxation moderately. If Maryland could tax one federal instrument, it could tax the mail, the mint, federal courts, customs papers, or any other means Congress employs. That principle would make national operations dependent on the States and reverse the Constitution's allocation of supremacy.

The ruling did not exempt all Bank-related property or interests from ordinary, nondiscriminatory state taxation. Maryland could tax the Bank's real property in common with other real property, and could tax its residents' interests in the Bank in common with similar property. What it could not do was impose a tax directed at the Bank's federal operations.