CRS Annotated Constitution

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Borrowing Power Versus Fiscal Power

Usually the aggregate of the fiscal and monetary powers of the National Government—to lay and collect taxes, to borrow money and to coin money and regulate the value thereof—have reinforced each other, and, cemented by the necessary and proper clause, have provided a secure foundation for acts of Congress chartering banks and other financial institutions,1296 or making its treasury notes legal tender in the payment of antecedent debts.1297 But in 1935, the opposite situation arose—one in which the power to regulate the value of money collided with the obligation incurred in the exercise of the power to borrow money. By a vote of eight–to–one the Supreme Court held that the obligation assumed by the exercise of the latter was paramount, and could not be repudiated to effectuate the monetary policies of Congress.1298 In a concurring opinion, Justice Stone declined to join with the majority in suggesting that “the exercise of the sovereign power to borrow money on credit, which does not override the sovereign immunity from suit, may nevertheless preclude or impede the exercise of another sovereign power, to regulate the value of money; or to suggest that although there is and can be no present cause of action upon the re[p.289]pudiated gold clause, its obligation is nevertheless, in some manner and to some extent, not stated, superior to the power to regulate the currency which we now hold to be superior to the obligation of the bonds.”1299 However, with a view to inducing purchase of savings bonds, the sale of which is essential to successful management of the national debt, Congress is competent to authorize issuance of regulations creating a right of survivorship in such bonds registered in co–ownership form, and such regulations preempt provisions of state law prohibiting married couples from utilizing the survivorship privilege whenever bonds are paid out of community property.1300

Clause 7. The Congress shall have Power * * * To establish Post Offices and post roads.



The great question raised in the early days with reference to the postal clause concerned the meaning to be given to the word “establish”—did it confer upon Congress the power to construct post offices and post roads, or only the power to designate from existing places and routes those that should serve as post offices and post roads? As late as 1855, Justice McLean stated that this power “has generally been considered as exhausted in the designation of roads on which the mails are to be transported,” and concluded that neither under the commerce power nor the power to establish post roads could Congress construct a bridge over a navigable water.1301 A decade earlier, however, the Court, without passing upon the validity of the original construction of the Cumberland Road, held that being “charged . . . with the transportation of the mails,” Congress could enter a valid compact with the State of Pennsylvania regarding the use and upkeep of the portion of the road lying in the State.1302 The debate on the question was terminated in 1876 by the decision in Kohl v. United States,1303 sustaining a proceeding by the United States to appropriate a parcel of land in Cincinnati as a site for a post office and courthouse.


Power To Protect the Mails

The postal powers of Congress embrace all measures necessary to insure the safe and speedy transit and prompt delivery of the mails.1304 And not only are the mails under the protection of the National Government, they are in contemplation of law its property. This principle was recognized by the Supreme Court in 1845 in holding that wagons carrying United States mail were not subject to a state toll tax imposed for use of the Cumberland Road pursuant to a compact with the United States.1305 Half a century later it was availed of as one of the grounds on which the national executive was conceded the right to enter the national courts and demand an injunction against the authors of any wide–spread disorder interfering with interstate commerce and the transmission of the mails.1306

Prompted by the efforts of Northern anti–slavery elements to disseminate their propaganda in the Southern States through the mails, President Jackson, in his annual message to Congress in 1835, suggested “the propriety of passing such a law as will prohibit, under severe penalties, the circulation in the Southern States, through the mail, of incendiary publications intended to instigate the slaves to insurrection.” In the Senate, John C. Calhoun resisted this recommendation, taking the position that it belonged to the States and not to Congress to determine what is and what is not calculated to disturb their security. He expressed the fear that if Congress might determine what papers were incendiary, and as such prohibit their circulation through the mail, it might also determine what were not incendiary and enforce their circulation.1307 On this point his reasoning would appear to be vindicated by such decisions as those denying the right of the States to prevent the importation of alcoholic beverages from other States.1308

Power To Prevent Harmful Use of the Postal Facilities

In 1872, Congress passed the first of a series of acts to exclude from the mails publications designed to defraud the public or corrupt its morals. In the pioneer case of Ex parte Jackson,1309 the[p.291]Court sustained the exclusion of circulars relating to lotteries on the general ground that “the right to designate what shall be carried necessarily involves the right to determine what shall be excluded.”1310 The leading fraud order case, decided in 1904, held to the same effect.1311 Pointing out that it is “an indispensable adjunct to a civil government,” to supply postal facilities, the Court restated its premise that the “legislative body in thus establishing a postal service may annex such conditions . . . as it chooses.”1312

Later cases first qualified these sweeping assertions and then overturned them, holding Government operation of the mails to be subject to constitutional limitations. In upholding requirements that publishers of newspapers and periodicals seeking second–class mailing privileges file complete information regarding ownership, indebtedness, and circulation and that all paid advertisements in the publications be marked as such, the Court emphasized that these provisions were reasonably designed to safeguard the second–class privilege from exploitation by mere advertising publications.1313 Chief Justice White warned that the Court by no means intended to imply that it endorsed the Government’s “broad contentions concerning . . . the classification of the mails, or by the way of condition . . .”1314 Again, when the Court sustained an order of the Postmaster General excluding from the second–class privilege a newspaper he had found to have published material in contravention of the Espionage Act of 1917, the claim of absolute power in Congress to withhold the privilege was sedulously avoided.1315

A unanimous Court transformed these reservations into a holding in Lamont v. Postmaster General,1316 in which it struck down a statute authorizing the Post Office to detain mail it determined to be “communist political propaganda” and to forward it to the addressee only if he notified the Post Office he wanted to see it. Noting that Congress was not bound to operate a postal service, the Court observed that while it did, it was bound to observe constitutional guarantees.1317 The statute violated the First Amendment[p.292]because it inhibited the right of persons to receive any information which they wished to receive.1318

On the other hand, a statute authorizing persons to place their names on a list in order to reject receipt of obscene or sexually suggestive materials is constitutional, because no sender has a right to foist his material on any unwilling receiver.1319 But, as in other areas, postal censorship systems must contain procedural guarantees sufficient to ensure prompt resolution of disputes about the character of allegedly objectionable material consistently with the First Amendment.1320


1296 McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316, 407 (1819); Osborn v. United States Bank, 9 Wheat. (22 U.S.) 737, 861 (1824); Farmers’ & Mechanics’ Nat. Bank v. Dearing, 91 U.S. 29, 33 (1875); Smith v. Kansas City Title Co., 255 U.S. 180, 208 (1921).
1297 Legal Tender Cases (Knox v. Lee), 12 Wall. (79 U.S.) 457, 540–547 (1871).
1298 Perry v. United States, 294 U.S. 330, 353 (1935).
1299 Id., 361.
1300 Free v. Bland, 369 U.S. 663 (1962).
1301 United States v. Railroad Bridge Co., 27 Fed. Cas. 686 (No. 16,114) (C.C.N.D. Ill. 1855).
1302 Searight v. Stokes, 3 How. (44 U.S.) 151, 166 (1845).
1303 91 U.S. 367 (1876).
1304 Ex parte Jackson, 96 U.S. 727, 732 (1878). See United States Postal Service v. Council of Greenburgh Civic Assns., 453 U.S. 114 (1981), in which the Court sustained the constitutionality of a law making it unlawful for persons to use, without payment of a fee (postage), a letterbox which has been designated an “authorized depository” of the mail by the Postal Service.
1305 Searight v. Stokes, 3 How. (44 U.S.) 151, 169 (1845).
1306 In re Debs, 158 U.S. 564, 599 (1895).
1307 Cong. Globe, 24th Cong., 1st Sess., 3, 10, 298 (1835).
1308 Bowman v. Chicago & Nw. Railway Co., 125 U.S. 465 (1888); Leisy v. Hardin, 135 U.S. 100 (1890).
1309 96 U.S. 727 (1878).
1310 Id., 732.
1311 Public Clearing House v. Coyne, 194 U.S. 497 (1904), followed in Donaldson v. Read Magazine, 333 U.S. 178 (1948).
1312 194 U.S., 506.
1313 Lewis Publishing Co. v. Morgan, 229 U.S. 288 (1913).
1314 Id., 316.
1315 United States ex rel. Milwaukee Publishing Co. v. Burleson, 255 U.S. 407 (1921). See also Hannegan v. Esquire, 327 U.S. 146 (1946), denying the Post Office the right to exclude Esquire Magazine from the mails on grounds of the poor taste and vulgarity of its contents.
1316 381 U.S. 301 (1965).
1317 Id., 305, quoting Justice Holmes in United States ex rel. Milwaukee Publishing Co. v. Burleson, 255 U.S. 407, 437 (1921) (dissenting opinion): “The United States may give up the Post Office when it sees fit, but while it carries it on the use of the mails is almost as much a part of free speech as the right to use our tongues. . . .” And see Blount v. Rizzi, 400 U.S. 410, 416 (1971) (quoting same language). But for a different perspective on the meaning and application of the Holmes language, see United States Postal Service v. Council of Greenburgh Civic Assns., 453 U.S. 114, 127 n. 5 (1981), although there too the Court observed that the postal power may not be used in a manner that abridges freedom of speech or press. Id., 126. Notice, too, that first–class mail is protected against opening and inspection, except in accordance with the Fourth Amendment. Ex parte Jackson, 96 U.S. 727, 733 (1878); United States v. van Leeuwen, 397 U.S. 249 (1970). But see United States v. Ramsey, 431 U.S. 606 (1977) (border search).
1318 Lamont v. Postmaster General, 381 U.S. 301, 306–307 (1965). And see id., 308 (concurring opinion). Note that this was the first congressional statute ever voided as in conflict with the First Amendment.
1319 Rowan v. Post Office Department, 397 U.S. 728 (1970).
1320 Blount v. Rizzi, 400 U.S. 410 (1971).
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