''Helvering v. Davis'', 301 U.S. 619 (1937), was a decision by the

U.S. Supreme Court The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all U.S. federal court cases, and over state court cases that involve a point ...

that held that Social Security was constitutionally permissible as an exercise of the federal power to spend for the general welfare and so did not contravene the Tenth Amendment of the

U.S. Constitution The Constitution of the United States is the supreme law of the United States of America. It superseded the Articles of Confederation, the nation's first constitution, in 1789. Originally comprising seven articles, it delineates the nationa ...

. The Court's 7–2 decision defended the constitutionality of the old-age benefit program of the

Social Security Act of 1935 The Social Security Act of 1935 is a law enacted by the 74th United States Congress and signed into law by US President Franklin D. Roosevelt. The law created the Social Security program as well as insurance against unemployment. The law was pa ...

by requiring only welfare spending to be for the common benefit, as distinguished from some mere local purpose. It affirmed a District Court decree that held that the tax upon employees was not properly at issue and that the tax upon employers was constitutional.

Facts

shareholder A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal ...

of the

Edison Electric Illuminating Company The Edison Illuminating Company was established by Thomas Edison on December 17, 1880, to construct electrical generating stations, initially in New York City. The company was the prototype for other local illuminating companies that were establi ...

brought a

derivative action A shareholder derivative suit is a lawsuit brought by a shareholder on behalf of a corporation against a third party. Often, the third party is an insider of the corporation, such as an executive officer or director. Shareholder derivative suits are ...

to restrain the company from making payments and deductions required by the

on the grounds that it was unconstitutional. He sought an injunction and a declaration that the Act was void.

Decision

The Supreme Court's decision in the case was written by Justice

Benjamin N. Cardozo Benjamin Nathan Cardozo (May 24, 1870 – July 9, 1938) was an American lawyer and jurist who served on the New York Court of Appeals from 1914 to 1932 and as an Associate Justice of the Supreme Court of the United States from 1932 until his dea ...

and supported the right of Congress to interpret the "general welfare" clause in the Constitution. Joining the decision was Justice

Harlan Stone Harlan Fiske Stone (October 11, 1872 – April 22, 1946) was an American attorney and jurist who served as an associate justice of the U.S. Supreme Court from 1925 to 1941 and then as the 12th chief justice of the United States from 1941 ...

, who during the drafting of the legislation had advised Secretary

Frances Perkins Frances Perkins (born Fannie Coralie Perkins; April 10, 1880 – May 14, 1965) was an American workers-rights advocate who served as the 4th United States secretary of labor from 1933 to 1945, the longest serving in that position. A member of t ...

that the constitutionality of Social Security could be based upon "The taxing power of the Federal Government, my dear; the taxing power is sufficient for everything you want and need."

References

External links

* {{USArticleI United States Constitution Article One case law United States Supreme Court cases United States Supreme Court cases of the Hughes Court Taxing and Spending Clause case law 1937 in United States case law Social Security lawsuits

Facts

Decision

See also

Further reading

References

External links