According to Maryland, Congress violated the Tenth Amendment by chartering the Second Bank of the United States in Baltimore in 1817. The Tenth Amendment states:
"The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."
Maryland believed Congress had infringed the State's right of sovereign authority because the Constitution didn't explicitly mention banking; therefore, they reasoned, chartering banks was a reserved right under the Constitution. Maryland decided to exercise their authority by passing a law taxing all banks not chartered in Maryland.
Chief Justice Marshall held that the Taxing and Spending Clause implied a need for handling revenue (Article I, Section 8, Clause 1) and the Necessary and Proper Clause (Article I, Section 8, Clause 18) allowed Congress to establish a national bank in order to facilitate the exercise of legitimate constitutional powers. Further, Marshall held that the Supremacy Clause (Article VI, Clause 2) elevated federal law above state law when the two are in conflict, and prohibited the states from interfering with government activity.
Additional Information:
This case was instrumental in providing clarification to what the "implied powers" of Congress (here, at a federal level) were, and as a show of the authority structure of the states versus the federal government.
In John Marshall's decision, he declared that outside of those powers immediately declared Congress, there are unwritten powers entitled them to provide for the continuity of the United States -- this hearkens to the "necessary and proper clause" of the Constitution.
Marshall also declared that states did not have the right to impinge upon any law created Constitutionally by Congress, as they had done by placing a tax upon Maryland-based federal banks.
Case Citation:
McCulloch v. Maryland, 17 US 316 (1819)
For more information on McCulloch v. Maryland, see Related Questions, below.
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