McCulloch vs Maryland

McCulloch vs Maryland

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  • February 1816 in Congress....
  • Lets make a 2nd U.S. Bank. It will be able to loan money to the government, issue bank notes, and hold deposited federal funds
  • The national bank angered many of the state banks as it was exempt from taxes in return for loaning money to the government. In response, the Maryland state legislature imposed a tax on all banks " not chartered within the state." The national bank was the only one not chartered to the state. 
  • This new National Bank is not fair to our state banks, we should tax the national banks. 
  • The cashier at the Baltimore branch of the National Bank, James McCulloch, refused to pay the tax. In response, Maryland sued McCulloch.
  • I'll see you in court
  • This tax is dumb! I'm not going to pay it. 
  • To bad, the state of Maryland is suing you for not paying our tax
  • Oh Yeah? Well guess what, I'm taking this to the Supreme Court because this isn't Constitutional!
  • This court affirms the previous decision in favor of Maryland.
  • After a state court ruled in favor of Maryland, McCulloch went to a court of appeals
  • Ha!
  • In 1819 the case was reviewed by the supreme court. First the Supreme court unanimously stated that, under the Necessary and Proper clause, Article 1 Section 8 of the constitution, the federal government had the power make a national bank.
  • It is totally constitutional to have a federal bank!
  • We agree
  • The court also agreed that Mary land did not have the right to tax the National Bank according to the supremacy clause of Article 4 of the constitution. They held that the Nation's sovereignty was held not in the states but in the people. 
  • agreed
  • Yaaaay
  • Me three
  • Maryland, your tax is unconstitutional, get rid of it.
  • Darn
  • sounds good to me
  • I second that. 
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