Wis. 35; Veazie Bank v. Fenno, 8 Wall. 533; Sav. & L. Soci. v. Austin, 45 Cal. 477; People v. Reynolds, 10 Ill. 12; People v. Salomon, 51 Ill. 54.

9 Hylton v. U. S. 3 Dall. 177; U. S. v. Tappan, 11 Wheat. 419; Woodruff v. Parham, & Wall. 123; Hinson v. Lott, 8 Wall. 148.

10 Loughborough v. Blake, 5 Wheat. 317. See U. S. v. Riley, 5 Blatchf.

264.

-11 Matt of Meador, 1 Abb. U. S. 334.

-12 Loan Asso. v. Topeka, 20 Wall. 663; In re Mayor of N. Y. 11 Johns. 80: Broadhead v. Milwaukee, 19 Wis. 624; Stockton & V. R. R. Co. v. Stockton, 41 Cal. 173.

- 13 Gibbons v. Ogden, 9 Wheat. 199.

-14 Collector v. Day, 11 Wall. 125; U. S. v. Railroad Co. 17 Wall. 322; Sweatt v. Boston &c. R. R. Co. 5 Bánk. Reg. 248.

-15 U. S. v. Railroad Co. 17 Wall. 334.

16 Dobbins v. Commrs. Erie Co. 16 Pet. 435; Freedman v. Sigel, 10 Blatchf. 330; Collector v. Day, 11 Wall. 125; Legal Tender Cases, 12 Wall. 457.

17 Fifield v. Close, 15 Mich. 505; Tucker v. Potter, 35 Conn. 46.

-18 Scholey v. Rew, 23 Wall. 331.

19 U. S. v. Rhodes, 1 Abb. U. S. 49.

- 20 Tax on Salaries, 13 Op. Att. Gen. 161.

21 U. S. v. McKinley, 4 Brewst. 246. See Supplement, post, 291.

State power of taxation.-By the Revolution the wers of Government devolved upon the people of the States. The power of taxation herein conferred does not operate as a prohibition on the States, it is a power concurrent in the National and State Governments.2 The taxing power of the State is an attribute of sovereignty, and exists independent of the Constitution of the United States. The power is supreme, unless the subject be beyond the borders of the State, or as to property within the State, but ceded to the United States, and within their separate and exclusive jurisdiction, and this supremacy cannot be questioned by the judiciary. Except as restricted by the Constitution, States have full power of taxation over all subjects, and over aliens equally with citizens. States are only excluded from taxation of the means and instruments employed by the General Government in the exercise of its functions,7 or the instruments, emoluments, or persons, and the necessary and proper means to execute its sovereign power,3 but though these are exempt, yet the States may tax the property of Government agents.9 A State cannot tax United States property within its limits, 10 nor the compensation of a United States officer; but a State may tax the salary of a post-office clerk. 12 So, a party who obtains a license to trade from the Government is not an officer. 13 A State cannot tax public moneys devoted to

its appropriate purposes, 14 nor money in the treasury, nor precious metals in the mint, nor the lots, structures, ships, materials of war, or other property devoted to the public purposes of the United States, 15 nor can it tax internal revenue stamps.16 These exemptions depend upon the effect of the tax, whether it will hinder the efficient exercise of the powers of the Government, 17 but not to a tax which only remotely affects the efficient exercise of the powers of the Government. 18 To make a tax void the absence of all possible public interest must be clear and palpable.19 A State may levy a tax to pay the commutation of persons drafted into the military service, 20 or to pay bounties to volunteers.21 So, a State may tax shares of a railroad to which Congress has extended aid, or may tax the gross receipts of railroads, 22 and may provide for collecting taxes in gold or silver only.28

1 McCulloch v. Maryland, 4 Wheat. 316; Dartmouth Coll. v. Woodward, 4 Wheat. 518; Green v. Biddle, 8 Wheat. 1; Ogden v. Saunders, 12 Wheat. 213; Cherokee Nation v. Georgia, 5 Peters, 47.

2 Passenger Cases, 7 How. 571; Perveer v. Comm., 5 Wall. 475; HamIlton Comp. Mississippi, 6 Wall. 639; Sweatt v. Boston &c. R. R. Co., 5 Bank. Reg. 248; Van Allen v. Assessors, 3 Wall. 585.

3 McCulloch v. Maryland, 4 Wheat. 316; Lane Co. v. Oregon, 9 Wall. 77; Railroad Co. v. Peniston, 18 Wall. 29; Nathan v. Louisiana, 8 How. 73; People v. Coleman, 4 Cal. 45.

4 McCulloch v. Maryland, 4 Wheat. 316; Gibbons v. Ogden, 9 Wheat. 199; 17 Johns. 488; 4 Johns. Ch. 150; People v. New York, 2 Black, 620; 2 Wall. 200; 3 Id. 573; Passenger Cases, 7 How. 538; Ward v. Maryland, 12 Wall. 427; Pullan v. Kinsinger, 2 Abb. U. S. 112; U. S. v. Ames, Wood. & M. 76; Russell v. N. Y., 2 Denio. 461; State Treasurer v. Wright, 28 Ill. 509; People v. Hawley, 3 Mich. 330; Fifield v. Close, 16 Mich. 505; People v. Mayor &c. of Brooklyn, 4 N. Y. 425; Scovil v. Cleveland, I Ohio St. 126; Maloy v. Marietta, 11 Id. 638; Weister v. Hade, 52 Pa. St. 474; Armington v. Barnet, 15 Vt. 743; Mayor &c. v. Lord, 18 Wend. 126. 5 Lane Co. v. Oregon, 7 Wall. 71; Ward v. Maryland, 12 Wall. 430; Loan Asso. v. Topeka, 20 Wall. 669; Bates v. Cooper, 5 How. 115; Pullen v. Kinsinger, 2 Abb. U. S. 110; Gashweller v. McIlvoy, 1 A. K. Marsh. 84; Rexford v. Knight, 15 Barb. 627; Rubothom v. McClure, 4 Blackf. 505; Hawkins v. Lawrence, 8 Id. 226; Bradley v. N. Y. &c. R. R. Co. 21 Cal. 304; Clark v. Saybrook, 21 Conn. 313; Russell v. N. Y. 2 Denio, 461; People v. Commrs. 5 Denio, 401; Raleigh &c. Co. v. Davis, 2 Dev. & B. 451; Swan v. Williams, 2 Mich. 442; Baker v. Johnson, 2 Hill, 342; People v. Hayden, 6 Ibid. 359; McCormick v. Town o. La Fayette, 1 Ind. 48; Canal Co. v. Ferris, 2 Ibid. 331: People v. Wells, 12 Ibid. 102; Jackson v. Winn, Litt. 322; Mason v. Kennebec &c. Co. 31 Me. 215; People v. M. S. R. R. Co. 3 Met. 496; Smith v. McAdam. Ibid. 506; Charlestown &c. R. R. Co. v. Middlesex, 7 Met. 78; Mount Wash. R. R. Co.'s Petition, 30 N. H. 135; Bank of Chenango v. Brown, 26 N. Y. 467; Ligat v. Commonwealth, 19 Pa. St. 456; Yost's Report, 17 Id. 524; Mayor of Pittsburgh ". Scott, 1 Pa. St. 309; Bloodgood v. Mohawk Co. 13 Wend. 9; Mercer. McWilliams, Wright, 132; Bennington v. Park, 50 Vt. 178.

6 Fratz's Appeal, 52 Pa. St. 267.

7 McCulloch v. Maryland, 4 Wheat. 316; Van Allen v. Assessors, 3 Wall. 535; Austin v. Alde men; 7 Wall. 699; Banks r. Mayor, 7 Wall. 16; Hamilton Comp. v. Massachusetts, 6 Wall. 639; Dobbins v. Commrs. of

Erie Co. 16 Peters, 435 People v. Commrs. of Taxes, 4 Wall. 244; 35 N.

Y. 423; Osborn v. Bank of U. S. 9 Wheat. 738.

8 Dobbins v. Commrs. of Erie Co. 16 Peters, 435; 7 Watts, 513.

9 Railroad Co. v. Peniston, 18 Wall. 5.

10 Anonymous, 9 Opin. Att. Gen. 291.

11 Dobbins v. Commissioners, 16 Peters, 435; 7 Watts, 513.

12 Melcher v. Boston, 50 Mass. 73.

13 State v. Bell, Phill. (N. C.) 76.

14 Comm. v. Morrison, 2 A. K. Marsh. 75.

15 City v. Churchill, 33 N. Y. 693; 43 Barb. 550.

16 Palfrey v. Boston, 101 Mass. 329.

17 Railroad Co. v. Peniston, 18 Wall. 5; National Bank v. Comm. 9 Wall., 353; Waite v. Dowley, 9 Ch. L. N. 263; Dobbins v. Commrs. 16 Peters, 435; 7 Watts, 513.

18 Railroad Co. v. Peniston, 18 Wall. 5.

19 Brodhead v. Milwaukee, 19 Wis. 624; Stockton & V. R. R. Co. v. Stockton, 41 Cal. 173; Schenley v. Alleghany, 25 Pa. St. 128.

20 Freeland v. Hastings, 10 Allen, 570; Wagner v. Collector, 31 N. J. 190.

21 Booth v. Woodbury, 32 Conn. 118; Coffman v. Keightley, 24 Ind. 509; Board v. bearss, 25 Ind. 110; Winchester v. Corrinna, 55 Me. 9; Comer v. Folsom, 13 Minn. 219; Wilson v. Bruckman, 13 Minn. 441; State v. Jackson, 31 N. J. 189; State v. Demarest, 32 N. J. 528; Speer v. Directors, 50 Pa. St. 150; Ahl v. Gleim, 52 Pa. St. 432. But see Ferguson v. Landram, 1 Bush, 548.

22 Woodruff v. Parham, 8 Wall. 123.

23 State Treasurer v. Wright, 28 Ill. 509; Whiteaker v. Haley, 2 Or. 128.

2To borrow money on the credit of the United States.

The power to borrow includes the power to issue the requisite securities or evidences of debt for the money borrowed,1 or for capital and commodities of which money is the representative,2 and to issue treasury notes under the various acts of Congress, their issue being an exchange of credit for money or property.4 Congress may constitutionally authorize the emission of bills of credit, and by suitable enactments may restrain the circulation, as money of any notes not issued by itself. In issuing paper promises to circulate as currency their makers are in effect borrowing on the credit of these promises.6 Money is gold and silver, or the lawful circulating medium of the country, including bank-notes.7 "On the credit" authorizes the issue of bills or notes by the Government to circulate as money, without providing for repayment of the money borrowed at any particular day, or with interest,8 and to charter national banks," and issue notes intended to circulate as money.10 Congress may restrict the circulation of any notes not issued under its authority.11

DESTY FED. CON.-6.

1 Hamilton Comp. v. Massachusetts, 6 Wall. 639; Hague v. Powers, 39 Barb. 427; Thayer v. Hedges, 22 Ind. 282; Van Husan v. Kanouse, 13 Mich. 303; George v. Concord, 45 N. H. 434; Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

2 Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

3 Thorndyke v. U. S. 2 Mason, 18; Pennsylvania Cases, 52 Pa. St. 15100; Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

4 Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

5 Veazie Bank v. Fenno, 8 Wall. 533.

6 Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

7 Mann v. Mann, 1 Johns. Ch. 236.

8 Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

9 McCulloch v. Maryland, 5 Wheat. 316; Osborn v. Bank of U. S. 9 Wheat. 738; Weston v. Charleston, 2 Pet. 449.

10 Bank v. Supervisors, 7 Wall. 26.

11 Veazie Bank v. Fenno, 8 Wall. 533.

Legal tenders.-There is no express grant of power to make a credit currency a legal tender in payment of debts; but the authority is necessarily implied, as a means to the exercise of the functions of government.8 If in the judgment of Congress it be necessary, in order to enhance the credit of the Government promises, it may make them a legal tender; in all but cases excepted by law, it is a necessary incident to sovereignty. The power is not subject to mutations, but is the same in peace or in war.7 The power is not to be resorted to except upon extraordinary occasions or public exigencies of. great importance. A statute making treasury notes a legal tender is valid, and though they are only the representatives of money, 10 they may be made a substitute for coin.11 The provisions of the act rendering them legal tender applies to antecedent as well as subsequent contracts, 12 but they are not legal tenders on a contract specifically payable in gold and silver coin, 18 nor as to the payment of taxes, but only private debts. 14 A law of Congress to change the currency in which a contract may be discharged does not impair the obligation of the contract. 15 A contract may be satisfied by payment of what is a legal tender at the time the debt falls due. 16 The first legal tender act was in favor of foreign coin.17

1 Hepburn v. Griswold, 8 Wall. 603; 2 Duval, 29.

2 Lick v. Faulkner, 25 Cal. 404.

3 Banks v. The Mayor, 7 Wall. 16.

4 Wood v. Buller, 6 Allen, 516; Schoenberger v. Watts, 10 Am. Law Reg. 553; Hague v. Powers, 39 Barb. 427; Lick v. Faulkner, 25 Cal. 404; Reynolds v. Bank of Indiana, 18 Ind. 467; Thayer v. Hedges, 23 Ind. 141; Brown v. Welch, 26 Ind. 116; Hontrager v. Bates, 18 Iowa, 174; Van Husen v. Kanouse, 13 Mich. 303; Warnibold v. Schlicting, 16 Iowa, 243;

Riddlesbarger v. McDaniel, 38 Mo. 138; Verges v. Giboney, Ibid. 453; Maynard v. Newman, 1 Nev. 271; Metropolitan Bank v. Van Dyck, 27 N. Y.403; Shollenberger v. Brinton, 52 Pa. St. 100; Carpenter v. Northfield Bank, 39 Vt. 49; Breitenbach v. Turner, 18 Wis. 140; Warner v. Sauk Co. 20 Wis. 494.

5 Brown v. Welch, 26 Ind. 116.

6 Van Husen v. Kanouse, 13 Mich. 303; Maynard v. Newman, 1 Nev. 271: George v. Concord, 45 N. H. 434; Metropolitan Bank v. Van Dyck, 27 N. Y. 400; Shollenberger v. Brintón, 52 Pa. St. 100.

7 Legal Tender Cases, 12 Wall. 457; 11 Wall. 682. 8 Legal Tender Cases, 12 Wall. 457; 11 Wall. 682.

9 Legal Tender Cases, 12 Wall. 457; 11 Wall. 682; Dooley v. Smith, 13 Wall. 604; Railroad Co. v. Johnson, 15 Wall. 195; Hague v. Powers, 39 Barb. 427; Lick v. Faulkner, 25 Cal. 404; Curiac v. Abadie, 25 Cal. 502; Kierski v. Matthews, 25 Cal. 591; Latham v. U. S. 1 Ct. Cl. 149; 2 Ibid. 573; Jones v. Harker, 37 Ga. 503; Black v. Lusk, 69 Ill. 70; 18 Ind. 467; Thayer v. Hedges, 23 Ind. 141; Hintrager v. Bates, 18 Iowa, 174; George v. Concord, 45 N. H. 434; Shollenberger v. Brinton, 52 Pa. St. 100; Murray v. Gates, 52 Barb. 427.

10 Griswold v. Hepburn, 2 Duval, 46.

11 Metropolitan Bank v. Van Dyck, 27 N. Y. 426.

12 Metropolitan Bank v. Van Dyck, 27 N. Y. 400; Rodes v. Bronson, 34 N. Y. 649; Legal Tender Cases, 12 Wall. 457, overruling Hepburn v. Griswold, 8 Wall. 607, on this point. See Willard v. Tayloe, 8 Wall. 557; Jones v. Harker, 37 Ga. 503.

13 Bronson v. Rodes, 7 Wall. 229; Butler v. Horwitz, Ibid. 258; Dew. ing v. Sears, 11 Wall. 379.

14 Lane Co. v. Oregon, 7 Wall. 81; Whitaker v. Haley, 2 Oreg. 128; Illinois v. Wright, 28 III. 509.

15 Fair v. Marsteller, 2 Cranch, 20; Mason v. Haile, 12 Wheat. 370; U. S. v. Robertson, 6 Peters, 644; Metropolitan Bank v. Van Dyck, 27 N. Y. 400.

16 U. S. v. Webster, 2 Ware (Dav.) 48; Shollenberger v. Brinton, 52 Pa. St. 46.

17 Metropolitan Bank v. Van Dyck, 27 N. Y. 424.

Taxation of securities.-The power to borrow money includes the power to exempt national securities from State taxation.1 So, a State cannot tax stocks issued by the General Government for loans.2 This immunity from taxation covers all Government securities, as certificates of indebtedness,3 or United States bonds,4 or the income derived from interest paid on United States bonds,5 or foreign-held bonds; 6 but a State law imposing a tax on bonds and stocks of a foreign corporation, owned in the State, is valid;7 so, States may tax estates though composed of United States securities, but not the capital of a corporation where the capital is invested in stocks or bonds of the United States. Where franchises are taxed and not property, the capital stock may be taxed, although it consists of United States securities. 10 States cannot tax treasury notes used as currency without per