Suchergebnisse

In the 1934 term, the Supreme Court came to grips with some of the major constitutional problems of the New Deal and rendered decisions more intimately affecting our national life than any since the Dred Scott case of 1857. The great slavery decision rocked the nation to its foundations by its futile attempt to solve a problem insoluble by any means save war. The important constitutional decisions of the Reconstruction period in their immediate consequences affected mainly the South, and it will be remembered that by a series of side-steppings, some involuntary and some not, the Supreme Court escaped the necessity of passing squarely upon the validity of the basic program of Reconstruction as embodied in the act of 1867. Forty years ago, in its 1894 term, the Court incurred much unpopularity by three decisions of major significance. It invalidated the Income Tax Act passed in fulfillment of Democratic campaign pledges; it emasculated, temporarily at least, the Sherman Anti-Trust Act by holding it inapplicable to a most obvious and vicious monopoly—the sugar trust; and it incurred the hostility of organized labor by sustaining the issuance by a federal court of a labor injunction. None of these decisions was, however, nor were all of them together, as far-reaching in significance as those handed down in the last term of Court.

Following the repeal of the Eighteenth Amendment, the state of Ohio authorized by statute the creation of a state liquor monopoly, purchased $4,500,000 worth of liquor, and perfected plans for the retailing of it through 187 stores owned and managed by the state. In Ohio v. Helvering, the state sought an injunction to restrain the commissioner of internal revenue from collecting from the state the customary federal excise taxes upon the sale of intoxicating liquors. It alleged the immunity of the state and its instrumentalities from federal taxation and further claimed that the federal taxing statutes were not intended by Congress to apply to the states. The court, speaking through Mr. Justice Sutherland, upheld the collection of the tax, reaffirming the doctrine laid down in 1905 in the South Carolina Dispensary Case. The immunity from federal taxation enjoyed by the states extends only to those agencies and functions which are governmental in character and not to those which are proprietary. "When a state enters the market place seeking customers, it divests itself of its quasi-sovereignty pro tanto, and takes on the character of a trader, so far, at least, as the taxing power of the federal government is concerned." The Court rejected as "altogether fanciful" the argument that the passage of the Eighteenth Amendment and its later repeal had so altered the status of the liquor traffic that its conduct by the state has become an exercise of the state's police power, and hence a governmental operation immune from federal taxation.