In the case which held that the general tax upon incomes was not a direct tax, Mr. Justice Swayne said:

"Our conclusions are that direct taxes within the meaning of the Constitution are only capitation taxes as expressed in that instrument, and taxes on real estate." 31

After the income tax had been collected for more than six years and some of the decisions which sustained it had been made, the section of the Constitution relating to the apportionment of representatives and direct taxes was amended by the Fourteenth Amendment so as to change the rule as to representation; but that as regards taxation was left unaltered, it being the general understanding that it did not apply to taxes upon income.32

In 1894, in reliance upon this construction of the Constitution, in which all three of the departments of the government and the States had acquiesced, an attempt was made by its aid to accomplish that which the section had been adopted to prevent. The representatives of the new States in the West against whose action Gouverneur Morris had warned the other members of the Convention, combined with those of the South to oppress the States upon the North Atlantic coast. An unapportioned income-tax was imposed upon the revenues of individuals exceeding four thousand dollars, and on corporate incomes of all amounts, with the exemption, however, of some of the richest in the country, such as mutual insurance companies and ecclesiastical corporations; of which at least four-fifths, and probably a much larger proportion, was payable by four States,-New York, New Jersey, Pennsylvania and Massachusetts, while in a number of the

33

States that voted for it the incidence of the tax did not affect more than a very few individuals. The constitutionality of this proceeding, by the consent of the Attorney-General, who waived all questions of jurisdiction, was brought before the Supreme Court before the tax was payable. In their first decision the court held unanimously that so much of the tax as applied to the income from municipal bonds was void, since those securities could not be taxed by the United States; and by a majority of four to two, that

31 Springer v. U. S., 102 U. S. 586, 602.

32 See the dissent of Mr. Justice

White in Pollock v. Farmer's Loan and Trust Co., 158 U. S., 601, 715.

33 Mr. Choate's Argument in Pol

so much as applied to rents was also void, as a tax upon real estate, and consequently a direct tax which must be apportioned. They divided equally on the questions whether the invalidity of this part destroyed the rest; and whether the tax on the general income from personal property was also void as a direct tax.34 A reargument was ordered, which Mr. Justice Jackson, whose illness. had prevented his previous presence, left his death-bed to attend. He voted to sustain all of the act that did not apply to municipal bonds; but Mr. Justice Shiras, who on the first decision had voted to sustain so much as did not apply to rents, changed his mind; and by a majority of five to four the whole income-tax was held to be void, as a direct tax which had not been apportioned.35 In consequence of this decision the only definition of direct taxes that can be formulated with any assurance is as follows: Direct taxes are taxes on land, poll-taxes, and, as long as a majority of the Supreme Court are of the same mind, taxes on rents and general taxes upon personal property and incomes which are not confined to a special class, although with large classes of exemptions.36

The arguments on either side of this great case are so masterly presented in the opinions and the briefs of counsel, that a summary would be not only inadequate but superfluous. Now that the dust has not yet gathered upon the papers, it seems impossible

lock v. Farmer's Loan and Trust Co., 157 U. S., 429, 533; David A. Wells in The Forum for March, 1894, vol. xvii, p. 1.

34 Pollock v. Farmer's Loan and Trust Co., 157 U. S., 429.

35 Pollock v. Farmer's Loan and Trust Co., 158 U. S., 601.

36 The Constitution of Massachusetts (Part II, Ch. I, Art. IV) gives to the General Court power "to impose and levy proportional and reasonable assessments, rates and taxes upon all the inhabitants and persons resident and estates lying within the said Commonwealth; and also to impose and levy reasonable duties and excises upon any produce, goods, wares, merchandises and commodities

whatever, brought into, produced, manufactured or being within the same." It has been held that taxes upon occupations (Portland Bank v. Apthorp, 12 Mass., 252, 256), successions of every character (Minot v. Winthrop, 162 Mass., 113), and corporate franchises (Commonwealth v. Hamilton Manufacturing Co., 12 Allen (Mass.), 298, 307; s. c. as Hamilton Company v. Massachusetts, 6 Wall., 632; Commonwealth v. Provident Institution, 12 Allen, 312; s. c. as Provident Institution v. Massachusetts, 6 Wall., 611; Commonwealth v. Lancaster Savings Bank, 123 Mass., 493, Connecticut Insurance Co. v. Commonwealth, 133 Mass., 16), are "excises upon commodities."

for a commentator to discuss the question without bias, even were he so rash as to attempt to add to what was said by the eminent men who were engaged.

The reasons assigned by the majority were chiefly historical, designed to show that when the Constitution was adopted such a tax would have been considered as direct, and necessarily apportioned. In this it seems that they were successful. The chief reliance of the minority was on the principle stare decisis. They contended that the court ought not to overturn a construction of the Constitution settled by repeated decisions of their predecessors in the judiciary as well as acts of the other two departments of the government, which they contended had been undisturbed for over one hundred years. They argued, moreover, that the impossibility of the just apportionment of such a tax proved that it could not be within the intention of the Constitution; that the decision crippled the United States by depriving them of a power which might be indispensable to the successful conduct of a foreign war, when their ports were blockaded and so little revenue could be derived from a tariff; that it perpetuated a system of taxation unfair to the poor; and finally that it prevented the government from imposing upon the rich their just share of the public burdens.

One effect of the decision has been salutary. It has defeated an odious scheme of class-legislation. If upheld it will be a safeguard to property from any spoliation under the guise of Federal taxation, give encouragement to a new doctrine of State rights that may be of other assistance in the future, and afford a check to waste of the national treasury. Upon the other hand it has raised an obstacle against the further reduction of an oppressive tariff. It has shorn the United States of a power that might be essential to their preservation in case of war. And it has given a blow to settled principles of constitutional construction which makes no decision of the past seem any longer secure.38

87 See supra, § 41.

38 In the last volume the writer will

discuss the rules for the construction

of the Constitution.

APPENDIX TO CHAPTER VIII.

JEFFERSON'S OPINION ON THE APPORTIONMENT OF 1792.

"THE Constitution has declared that representatives and direct taxes shall be apportioned among the several States according to their respective numbers; that the number of representatives shall not exceed one for every 30,000, but each State shall have, at least, one representative; and, until such enumeration shall be made, the State of New Hampshire shall be entitled to choose three, Massachusetts, &c.

"The bill for apportioning representatives among the several States, without explaining any principle at all which may show its conformity with the Constitution or guide future apportionments, says, that New Hampshire shall have three members, Massachusetts sixteen, &c. We are, therefore, to find by experiment what has been the principle of the bill; to do which, it is proper to state the Federal or representable numbers of each State, and the members allotted to them by the bill. They are as follows:

"It happens that this representation, whether tried as between great. and small States, or as between North and South, yields, in the present instance, a tolerably just result, and consequently could not be objected to on that ground, if it were obtained by the process prescribed in the

Constitution; but, if obtained, by any process out of that, it becomes inadmissible.

"The first member of the clause of the Constitution above cited is express, that representatives shall be apportioned among the several States according to their respective numbers; that is to say, they shall be apportioned by some common ratio, for proportion and ratio are equivalent words; and it is the definition of proportion among numbers, that they have a ratio common to all, or, in other words, a common divisor. Now, trial will show that there is no common ratio or divisor which, applied to the numbers of each State, will give to them the number of representatives allotted in this bill; for, trying the several ratios of 29, 30, 31, 32, 33, the allottments would be as follows:

"Then the bill reverses the constitutional precept; because, by it, representatives are not apportioned among the several States according to their respective numbers.

"It will be said, that, though for taxes there may always be found a divisor which will apportion them among the States according to numbers exactly, without leaving any remainder; yet for representatives there can be no such common ratio, or divisor, which, applied to the several numbers, will divide them exactly, without a remainder or fraction. I answer, then, that taxes must be divided exactly, and representatives as nearly as the nearest ratio will admit, and the fractions must be neglected; because the Constitution wills, absolutely, that there be an apportionment or common ratio; and if any fractions result from the operation, it has left them unprovided for. In fact, it could not but foresee that such fractions would result, and it meant to submit to them. It knew they would be in favor of one part of the Union at one