McCulloch v. Maryland facts for kids

McCulloch v. Maryland was a very important court case in 1819. It was decided by the Supreme Court of the United States, which is the highest court in the country. This case was about whether a state could tax a bank that was set up by the federal government. The state of Maryland wanted to tax all banks that weren't created by Maryland itself. At that time, the only bank in Maryland that wasn't a state bank was the Second Bank of the United States. This bank was a branch of the main federal bank, which had been started in 1816.

Why This Case Happened

The United States Constitution does not directly say that the Supreme Court can decide if laws are fair or not. But in an earlier important case called Marbury v. Madison (1803), the Supreme Court decided it had the power to "say what the law is." This meant the Court could interpret, or explain, what the Constitution means.

By 1819, it was clear that Maryland was trying to target the US Bank. Many state banks didn't like the special advantages given to the US Bank by Congress. Also, a tough economic time called the Depression of 1818 was hurting state banks. Maryland put a tax on the US Bank branch in Baltimore. James McCulloch, who managed the bank branch, refused to pay the $15,000 tax on the bank's money.

At this time, states and the federal government were often arguing about who had more power. Maryland sued James McCulloch. The state courts said he had to pay the tax. McCulloch then asked the U.S. Supreme Court to hear his case in 1819.

The Supreme Court's Decision

The Supreme Court had to answer two main questions in this case. First, did Congress have the power to create a federal bank in the first place? Second, did the state of Maryland have the right to tax a part of the federal government? Was this allowed by the Constitution?

The Court decided that the federal government did have the power to set up a federal bank. It also ruled that a state could not tax the federal government. This meant that federal laws and actions were more powerful than state laws in certain situations.

What the Decision Meant

For the Second Bank of the United States, this victory didn't last forever. In 1828, Andrew Jackson became President of the United States. He believed in states' rights, meaning he thought states should have more power. Jackson stopped the bank from continuing when its charter ran out.

However, the McCulloch v. Maryland decision was still very important. Later, the American Civil War helped make the federal government much stronger. The changes to the Constitution after the war also supported a strong federal government. In the 20th century, the McCulloch v. Maryland case was used as a reason for the federal government to get very involved in the country's economy. It set a legal precedent, which means it created a rule that federal law is more important than state law in many matters.

Images for kids

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  A handwritten bank draft from the Second Bank of the United States, dated July 24, 1824, from Daniel Webster, who argued on behalf of McCulloch and the U.S. government in McCulloch v. Maryland

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  The text of the McCulloch v. Maryland decision, as recorded in the minutes of the Supreme Court