Gibbons v. Ogden (1824) Name: Take Your Boat and Go Home In 1803, the State of New York passed a law giving two men, Livingston and Fulton, the right to be the only ones allowed to operate steamboats in New York waters. Later, these men transferred their right to a man named Ogden. This meant that under New York law, nobody could operate a steamboat in New York without a license from Ogden. Gibbons was a New Jersey citizen who also had a ‘Livingston and Fulton's first successhulsteamboet, steamboat. Gibbons had licensed his boat under a law fee passed by the United States Congress. Gibbons ran his steamboat between New Jersey and New York. In 1818, Ogden filed suit against Gibbons to stop him from operating his steamboat in New York. The New York court ordered Gibbons to stop. 2 ©) The Arguments 1s it constitutional for both states and the | Gibbons took his case to the Supreme Court. He argued that federal government to reguate interstate | New York's law violated the Commerce Clause in the U.S. commerce? Constitution, which says "Congress shall have power to regulate SRN commerce with foreign nations, and among the several States, : and with Indian tribes.” Commerce means business activity. ee a governnent | Gibbons said his business activity took place “among the several ere ease States” because it happened in both New Jersey and New York. Ogden argued the words “among the several States” did not give Congress the power pass laws that affect business activity inside a state's borders. He also argued that, in the same way both states and the federal government can tax citizens, they should both be able to license boats. The Decision The Supreme Court agreed with Gibbons. The Court said it would be impossible for Congress to regulate business activity “among” the states ‘without regulating activity that took place inside a state's borders. Further, licensing boats is not like taxes, Two parts of government cannot issue licenses for the same thing without interfering with each other. The Court pointed to the Supremacy Clause in the Constitution, which says the laws of the federal government are superior to state laws. ‘The Court said the Constitution gives Congress the sole power to regulate business activity that affects more than one state. A state may only regulate business activity that takes place entirely inside its own borders, where no part of that activity affects any other state. Chief Justice John Marshall wrote the Courts opinion So What? In the years since the decision in Gibbons, the U.S. Congress has used its Commerce Clause power to pass many laws, for example: + Set a national minimum wage and maximum worker hours, by saying {goods produced in violation of this law could not cross state lines « Limit the age of child laborers to kids 16 and over « Prohibit racial discrimination in motels that served mostly travelers and in restaurants where the food served had crossed state fines ReadingMcCulloch v. Maryland Name: ren Power Play: State vs. Nation ‘What if someone gave you the power to read stories to a first grade class in the library—but gave the first graders the power to decide whether you're allowed to use any books? Or imagine you have the power to decide which TV shows your family will watch on Friday nights, but your kid sister has the power to decide whether anyone is allowed to turn the TV on, Who's really in control? In 1816, the state of Maryland tried to make a play against the United States government that would have worked just lke this. A New Government ig Questions Tn order to understand the tension between Maryland and the federal government, you have to imagine what it was like when the United States was first born, Our Founding Fathers had created a brand new government. There had never been another government exactly like it. Even though the Constitution described how it was supposed to work, the Constitution could not describe every detail. There were lots of questions—especially about how much power the federal government had. POOL POWER Constitutional Powers ‘ay have a ad : began at The U.S. Constitution created three branches of goverment and Community pool. Your bass gves YOu gave each branch certain powers. The legislative branch is made up s bese to, Mo spe ries at food oF Congress, which is made up of the Senate and the House of arn an po Nou cle Wt Representatives. Artie I of the Constitution gives Congress a long fee, they shoud bring thelr oan” SC OF Powers. It also says Congress can "make all Laws which shall snacks. in order to cary aut this rue, @ RECessary and proper” for carrying out these powers. But what you make arrangements tohave a stack does that mean? (Is a building a snack bar “necessary and proper” thar button the pool patio so customers for making rules about food and drinks at the pool?) In 1816, an buy the snacks there. Whoa! Did, Congress made a decision that tested out the "necessary and ‘your boss give you that kind of power?? proper” question in a big way. Congress Creates a Bank All nations need money to carry out their business, and the United States was no different. To make it easier for the government to do business, in 1816 ‘Congress passed a law creating a national bank. The Bank of the United States ‘was just like any other bank, except it was where the federal government did its banking business. In those days, state banks issued bank notes that functioned like money. The Bank of the U.S. was also allowed to issue bank = = notes. In exchange for this special treatment, t agreed to loan money to the eh pupae Courtesy U.S. government. of National Park Service. = Maryland Passes a Tax u g a 9 EF once the bank was established, it opened branches in different states. One ‘nay yates branch was located in Baltimore, Maryland. The U.S. government didn’t ask Maryland for permission—it just opened the branch and started doing business. Maryland's state banks weren't very happy about having a new ‘competitor in town where people could do their banking. And they didn’t . (continued on next page) iCavecs Reading p.1McCulloch v. Maryland Name: (continued from previous page) like that the Bank of the U.S. had a privileged relationship with the U.S. government. In response, Maryland's government passed a law of its own: Any bank that had not been chartered, or organized, in the state of Maryland had to pay a special tax. The Bank of the U. refused to pay, so the state of Maryland sued the bank in state court. Who Has the Power? ‘The Maryland courts sided with Maryland. So in 1819, the bank appealed to the United States Supreme Court. There were two main questions that needed to ‘be answered: Did the Constitution allow Congress to start a bank? And if so, ‘was a state allowed to tax a bank that was part of the federal government? ‘as always, the Supreme Court decided the case by looking at what the Constitution says. The Constitution gives Congress the power “to regulate Commerce . .. among the several States.” Regulate means to make rules about See eer tals Smrene something, Commerceis another word for business or trade. The Constitution Court and wrote the Courts also gives Congress the power to borrow money and collect taxes. But the ‘opinion in McCall v Constitution does not say Congress has the power to start a bank. Could Maryland. Congress start one anyway? If It's Necessary and Proper, It’s Okay Ina unanimous decision, the Supreme Court said yes. First, @ bank is “necessary and proper” for carrying out the powers related to commerce, borrowing, and taxes. But even without the power to do what is “necessary and proper,” Congress would still be able to start a bank. Why? | Because sometimes in order to be able to do one thing, you have to be able to do something else, For example, the Court pointed out that the Constitution gives Congress the power to maintain a navy but says nothing about steam ships. Even so, “no one doubts the power of Congress to use them." In the same way, the Court said, "A bank is a proper and suitable instrument to assist the operations of the government.” This decision expanded the powers of the national government. It did this [Then Congress can aiso.. by saying the government could take any action that was appropriate for « Establish a national b carrying out its powers—even if that action was not specifically mentioned in the Constitution, like starting a bank. Congress was only prohibited from doing things the Constitution specfically said it could notdo. State Interference? Not Okay. As for Maryland’s bank tax, the Constitution says that laws of the United States “shall be the supreme law of the land” and states must follow them. The Court said that if Maryland were allowed to tax the Bank of the U.S., it would have the }| power to tax the bank so heavily that the bank would be forced to leave the J} state, The court said that states are not allowed to interfere with the business of the U.S. government, This decision affirmed that the national United States government is “supreme” over state governments, just like the Constitution says. Maryland could not try to force the bank out by making it pay taxes. Reading p.2Gibbons v. Ogden (1824) A. Crossword. Complete the crossword puzzle using what you learned in Name: 6. The name of Livingston and Fulton's first successful steamboat. 7, The Supreme Court sided with this man, 10. The Court said a boat license is not like this. 12. Laws of the federal government are_ to state laws. Down 1. New York's law violated this. 2. "Commerce” means _ activity. 3. Both state and federal government cannot issue one of these at the same time. the reading. fa s || 7] Se io io 4. This state gave Livingston and Fulton the exclusive right to operate steamboats. 5, Has the sole power to regulate business iia activity that affects more than one state, 8. A state may only regulate business that takes place entirely inside its own __. 9. The New York court sided with this man, 11. Gibbons was from New _. B. Who Argued That? In this case, Gibbons had the winning arguments. Read each argument in the box. If Gibbons would have made that argument, write the arguments letter in his grid, If the argument would have favored Ogden, write the letter in Ogden's grid, A B © D. E F. G Ht involves more than one state, GIBBONS” ARGUMENTS Laws passed by the Constitution are supreme to state laws. ‘Commerce is only buying and seling things. It doesn't incude navigation of boats. Ony Congress is alowed to reguate commerce among the states. State laws are equal to laws Congress passes under the US, Constitution, ‘The power of Congress to requate commerce “among” states stops at a state's border. ‘Navigation of boats is part of commerce because it’s important. for business activity. Both states and the US. Congress may reguate commerce among the states. The power of Congress to regulate commerce ”anong” states means commerce that OGDEN’S ARGUMENTSMcCulloch v. Maryland A B The way our government should work is se ‘bed: the aa Congress Constitution The Constitution created ___ branches of three cae government. The legislative branch is made up of —_. Congress Founding Fathers The Constitution gives Congress a list of powers decane Congress can make laws that are necessary and —___. for carrying out its powers. powerful ee McCulloch v. Maryland was about whether bank tax the Constitution lets Congress start a. ‘McCulloch v. Maryland was also about whether a state could ___ a U.S. bank. a Lil oe Like state banks, the Bank of the US. was eo ee iggwedieg ice a bank notes snack bars Bankers in Maryland were —__ about the new bank in Baltimore. unhappy happy The first two courts ruled ___ Maryland. against for The Supreme Court ruled ___ Maryland. against for The Court said abank is for assisting | government operations. amass Proper The Court said Congress can carry out its powers in any way that is not ___ by the mentioned prohibited Constitution. The Constitution says laws of the United States are ____. cal fee The Court. said Maryland could not interfere with business of the ___ national state government. ievics ‘Active Participation Activity: Projection Master