US History

U.S. History Study Guide

rate prices. American manufacturers suffered from this influx of imports. As a result of the decline in trade, the U.S. economy began to collapse and banks contracted their lending practices. The U.S. Bank tried to slow the decline by tightening credit, and a sharp business slump resulted. Many state banks folded and many borrowers declared bankruptcy. In what became known as the Panic of 1819, land values fell fifty to seventy-five percent, rich land speculators lost fortunes, and homesteaders became mired in debt. The depression lasted roughly three years. The depression was most severe in the newly expanding West due in part to its economic dependency and partly because of heavy speculation in western lands. 9.8 The John Marshall Court Under his leadership, the court became as powerful a government force as Congress and the President. A staunch Federalist, Marshall delivered decisions which strengthened the central government at the expense of states’ rights, and he maintained a full interpretation of the Constitution. Despite the demise of the Federalist Party, Marshall continued to exercise a strong Federalist influence on government. • Marbury v. Madison (1803): This case established the precedent of the Supreme Court’s power to rule on the constitutionality of federal laws. • Fletcher v. Peck (1810): Georgia issued extensive land grants in a shady deal with the Yazoo Land Company. Marshall ruled against Georgia. This was the first time a state law was voided on the grounds that it violated a principle of the U.S. Constitution. • Dartmouth College v. Woodward (1819): The state tried to change Dartmouth from a private to a public institution by having its charter revoked. The Court ruled that the charter, though issued by the king during colonial days, still constituted a contract, and thus could not be changed or revoked without the consent of both parties. The result of this decision was to severely limit the power of state governments to control corporations. • McCulloch v. Maryland (1819): The state of Maryland had a desire to limit the powers of the federal government. A tax was placed on all notes the originated with banks chartered outside of the state. The Second Bank of the United States, a federal entity was the target of this tax. Marshall’s ruling declared that no state has the right to control an agency of the federal government. Since “the power to tax is the power to destroy,” such state action violated Congress’ “implied powers” to establish and operate a national bank. • Gibbons v. Ogden (1824): The State of New York had granted Ogden the ability to operate a steamboat between New York and New Jersey. Gibbons obtained a congressional permit to operate a steamboat line in the same waters. When Ogden sued to maintain his monopoly, the New York courts ruled in his favor. Gibbons’ appealed this to the Supreme Court. John Marshall ruled that only Congress had the right to regulate commerce among states and ruled in favor of Gibbons overturning the state's ruling. This decision provided the federal government with the ability to regulate interstate commerce. Additionally, the case added weight to the authority of the federal government over state's rights.

©2018

Achieve

Page 112

of 194