"Let the end be legitimate, let it be within the scope of the Constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the Constitution, are Constitutional."

Key Rulings: First, the Constitution grants to Congress implied powers to implement the Constitution's express powers to create a functional national government. Second, state action may not impede valid constitutional exercises of power by the federal government.
Although the Constitution doesn't specifically give Congress the power to establish a bank, Congress did have the power to tax and spend. Since banks are used to assist government in the collection and disbursement of the revenue, and federal laws have supremacy over state laws, Maryland had no power to interfere with the bank's operation by taxing it.

McCulloch is not only required reading for law school, but or almost any class on American Congressional power as it is THE most important case for the scope of Congress' powers and it's dominant relationship over the states. This remains relevant now and into the future, particularly as we see Congress repeatedly relying on it's broad powers to “tax and spend” and, as we can see by the endless money printing and unfunded legislation, Congress loves to tax and spend.

McCulloch's story starts begins in 1788, where the establishment of the FIRST national bank was a massive controversy (imagine if they knew what we are doing in 2021?). Soon after George Washington's inauguration as the first President of the United States in 1789, Alexander Hamilton, the Secretary of the Treasury, proposed creating a national bank to regulate American currency and deal with national economic problems. However, Secretary of State, Thomas Jefferson, strongly opposed the bank's creation, fearing that it would usurp the power of the various states and concentrate it to a dangerous degree in the central federal government. Congress took Hamilton's side and created the First Bank of the United States in 1791 but this did not resolve the fight. The partisans who supported Hamilton's dream of a strong central government formed the Federalist Party, while those that supported Jefferson's vision of a decentralized government focused on states' rights formed the Democratic-Republican Party.

Due to economic issues following the costly War of 1812, Congress passed legislation in 1816 to create a Second Bank of the United State. Many states resented the bank for calling back loans it had made to the state governments. As a result, states tried to block the bank or slow down it's operation, particularly by trying to tax it. In 1818, the Maryland's state legislature passed a $15,000 annual tax on any bank operating in Maryland which had not been chartered by the state of Maryland, which EXCLUSIVELY targeted the Second Bank of the United States.

James William McCulloch, head of the Baltimore Branch of the Second Bank of the United States, refused to pay the state tax. The lawsuit was filed by John James, an informer who sought to collect half of the fine, as provided for by the statute. The case was appealed to the Maryland Court of Appeals, where the state of Maryland argued that "the Constitution is silent on the subject of banks." It was Maryland's contention that without specific constitutional authorization for the federal government to create a bank, any such creation would be rendered unconstitutional. The Maryland Court of Appeals ruled in favor, perhaps unsurprisingly, of Maryland. The case was then appealed to the Supreme Court.

Once the case got to the Supreme Court, it was unanimous – but not in favor of Maryland, but McCulloch and the Federalist Congress. In the Supreme Court resoundingly held that Congress had the power to incorporate the bank and that Maryland could not tax instruments of the national government employed in the execution of constitutional powers. Under the Necessary and Proper Clause (Art. I, Section 8), Chief Justice Marshall explained that Congress possessed powers not explicitly outlined in the U.S. Constitution. Marshall redefined “necessary” to mean “appropriate and legitimate,” covering all methods for furthering objectives covered by the enumerated powers. Marshall wrote that while the states retained the power of taxation, the Constitution and the laws made in pursuance thereof are supreme and cannot be controlled by the states.

Today, the implied powers of Congress REMAIN the most controversial and heavily litigated. Each and every case which involves a challenge to Congressional authority will cite McCulloch v. Maryland. Whether we like it or not, the political, economic and legal winds of our early nation pushed towards a strong centralized government, rather than a decentralized republic. The interesting note is that our Constitution contained sentiments of BOTH ideas, regardless of the outcome of McCulloch. Simply because Congress was granted implied powers does not mean those powers are UNLIMITED. As we move forward, we can still channel the spirit of Maryland, even as the federal government summons McCulloch time and time again as a counter to expand their power.