Con Law I

1

• Taxing Spending Powers
• Oct. 13, 2004

2
The Tax Spend Clause

• The Congress shall have power to lay and
  collect taxes, duties, imposts and excises, to
  pay the debts and provide for the common defense
  and general welfare of the United States but all
  duties, imposts and excises shall be uniform
  throughout the United States

Power
Are these additional congressional powers?
Congress shall have power to pay the debts of the
US -and- Congress shall have power to provide for
the common defense and general welfare
Or are they limitations on the power to tax?
Compare preamble
3
US v. Butler (1936)

• Genl welfare clause not independent power, but
  qualification on taxing power
• The Congress shall have power to lay and collect
  taxes for the general welfare

Confined to the other enumerated powers?
Not confined to the other enum-erated powers?
Madison
Hamilton
Story
4
US v. Butler (1936)

• Power to tax for general welfare is an
  independent power in congress

Scope of this power?
Who decides meaning of general welfare?

• No need to decide since AAA invades the reserved
  rights of the states
• It is beyond the powers delegated to the federal
  government.
• US may not indirectly accomplish impermissible
  ends by taxing
• I.e., US can tax for genl welfare, but cannot
  regulate via taxes

• Stone this tax is not a disguised regulation
• All taxes have some incidental regulatory effect

5
Taxes Regulation or Revenue

• Roberts Test
• A tax that is regulatory must be valid under one
  of congress substantive enumerated powers
• A revenue tax (w/o regulatory effect) need not be
• Is there such a thing?

• Steward Machine v. Davis
• Cardoza congress power to tax is as broad as
  the states
• Specific limitations
• Uniform levies
• No income/wealth tax
• Reversed by 16th Amend.

6
Conditional Grants to States

• Basic Issue
• If tenth amendment prohibits congress from
  regulating states, may congress buy compliance
  with conditional grants?

• This becomes a serious problem as revenue sharing
  becomes more important to states
• When does inducement turn into "coercion"?

7
S. Dakota v. Dole (1987)

• Limitations on taxing / spending power
• Must be for general welfare
• as determined by congress, subject to RB test
• Conditional Grants generally
• Unconstitutional Conditions Test
• If gov't benefit is conferred only upon
  relinquishment by recipient of a constitutional
  right,
• There must be a substantial relation between
  purpose of the grant and the condition imposed

Otherwise gov't will always be able to purchase
rights
Congress cannot use its taxing/spending power (or
any other power) in violation of specific
prohibitions

• Serves process rationale of federalism

• Specific limitations on congressional power
• e.g., spending for religious purposes

• Additional requirement for grants to states
• Conditions must be unambiguous

8
S. Dakota v. Dole (1987)

• Brennan dissent
• 21st Amd imposes specific prohibition
• Judicially construed to give states plenary power
  to regulate alcohol
• O'Connor dissent
• Condition not "reasonably related" to grant
• Drinking age unrelated to highway construction

Is O'Connor substituting her view of relatedness
for that of congress?
Is this too narrow a view of congress' purpose?
9
Sabri v. US (2004)

• 18 USC 666(a)(2) bribing state/municipal
  officials
• if the agency receives federal
• Which congressional power?
• Commerce clause? commercial transaction?
  (Thomas concur.)
• Tax Spend clause?
• substantial relation between purpose of grant and
  condition imposed
• Jurisdictional element (proof of connection
  reqd)?

10
Sabri v. US (2004)

• Types of constitutional challenges
• Facial law incapable of constl application
• As-applied law unconstl in this case
• Valid exercise of TS/NP clauses because
• Conviction only if proof that fed money mispent
• Enough federal pouring in to give congress a
  stake in the integrity of local administration
• Money is fungible (liquid)
• Operates on individual officers, not states ?
• Thomas (concur)
• Rejects RB test (misreading of McCulloch)