408

Opinion of the Court.

legal and economic, necessarily were reflected in state legislation. States grappling with nation-wide, but nationally unregulated, business inevitably exerted their powers to limits and in ways not sought generally to be applied to other business held to be within the reach of the commerce clause's implied prohibition. Obvious and widespread examples are furnished in broad and detailed licensing provisions, for the doing of business within the states, and in connected or distinct taxing measures drawn in apparent reliance upon freedom from commerce clause limitations.16

Now we are told many of these statutes no longer can stand. The process of readjustment began affirmatively with South-Eastern. Since the commerce clause is a twoedged instrument, the indicated next step, indeed the constitutionally required one, as the argument runs, is to apply its negatively cutting edge. Conceptions so developed with reference to other commerce must now be extended to the commerce of insurance in completion of the readjustment. This, it is confidently asserted, will re-. quire striking down much of the state legislation enacted

approximately 600 persons and providing for an annual income of approximately $150,000 on such lives. During the year 1944 the Appellant collected as premiums on insurance policies $681,052,095.07, and paid out as claims on policies $246,776,197.45; and it paid out $13,690,781.93 on annuity contracts."

For South Carolina, the company "had in force 26,373 policies insuring the lives of approximately 20,000 persons resident in said State for a total amount of $30,827,184.00. During the year ending December 31, 1944, 1,439 policies insuring the lives of approximately 1,000 persons resident in said State for a total amount of $1,475,062.00 were issued, and $457,602.28 in claims were paid on policies covering the lives of residents." The South Carolina premium tax for 1943 amounted to $18,496.87; for 1944, $19,676.94. All other state or local taxes paid in 1944 amounted to $3,103.92, making a total for the year for all taxes of $22,780.86.

16 322 U. S. 533, dissenting opinion at 590; see note 40, infra; cf. Robertson v. California, post, p. 440.

and effective prior to the South-Eastern decision. Particularly will this be true of all discriminatory state taxes, of which it is said South Carolina's is one. Moreover, those results must follow regardless of the McCarran Act's provisions. For by that Act, in Prudential's assessment, Congress neither intended to, nor could, validate such taxes.

It is not surprising that the attack is thus broad. When a decision is conceived as precedent-smashing, rightly or wrongly, the conception's invitation may be to greater backtracking than is justified, in spite of warning to proceed with care. 322 U.S. 533, 547 ff.

Prudential's misconception relates not to the necessity for applying, but to the nature and scope of the negative function of the commerce clause. It is not the simple, clean-cutting tool supposed. Nor is its swath always correlative with that cut by the affirmative edge, as seems to be assumed. For cleanly as the commerce clause has worked affirmatively on the whole, its implied negative operation on state power has been uneven, at times highly variable. More often than not, in matters more governable by logic and less by experience, the business of negative implication is slippery. Into what is thus left open for inference to fill, divergent ideas of meaning may be read much more readily than into what has been made explicit by affirmation. That possibility is broadened immeasurably when not logic alone, but large choices of policy, affected in this instance by evolving experience of federalism, control in giving content to the implied negation. In all our constitutional history this has become no more apparent than in commerce clause dispositions.

That the clause imposes some restraint upon state power has never been doubted. For otherwise the grant of power to Congress would be wholly ineffective. But the limitation not only is implied. It is open to different implications of meaning. And this accounts largely for

variations in this field continuing almost from the beginning until now." They started with Marshall and Taney,

17 That the question was discussed but not settled in the Constitutional Convention itself, appears from debate on September 15, 1787, two days before submission of the proposed Constitution to Congress, a portion of which bears quotation:

"Mr. Mc.Henry & Mr. Carrol moved that 'no State shall be restrained from laying duties of tonnage for the purpose of clearing harbours and erecting light-houses.'

"Col. Mason in support of this explained and urged the situation of the Chesapeak which peculiarly required expences of this sort.

"Mr. Govr. Morris. The States are not restrained from laying tonnage as the Constitution now Stands. The exception proposed will imply the Contrary, and will put the States in a worse condition than the gentleman (Col Mason) wishes.

"Mr. Madison. Whether the States are now restrained from laying tonnage duties depends on the extent of the power 'to regulate commerce.' These terms are vague but seem to exclude this power of the States They may certainly be restrained by Treaty. He observed that there were other objects for tonnage Duties as the support of Seamen &c. He was more & more convinced that the regulation of Commerce was in its nature indivisible and ought to be wholly under one authority.

"Mr. Sherman. The power of the U. States to regulate trade being supreme can controul interferences of the State regulations [when] such interferences happen; so that there is no danger to be apprehended from a concurrent jurisdiction.

"Mr. Langdon insisted that the regulation of tonnage was an essential part of the regulation of trade, and that the States ought to have nothing to do with it. On motion 'that no State shall lay any duty on tonnage without the Consent of Congress'

Del. ay.

Md.

ay.

-4; di

"N. H-ay-Mas. ay. Ct. divd. N. J. ay. Pa. no. Va. no. N― C. no SC. ay. Geo. no. [Ayes-6; noes vided-1.]" Farrand, Records of the Federal Constitutional Convention of 1787 (1937), Vol. II, 625–626.

See Note, Congressional Consent to Discriminatory State Legislation (1945) 45 Col. L. Rev. 927, 946 ff., for a short summary of views expressed in the debates and later by members of the Convention. See also Abel, The Commerce Clause in the Constitutional Convention and in Contemporary Comment (1941) 25 Minn. L. Rev. 432; Hamilton and Adair, The Power to Govern (1937).

Opinion of the Court.

328 U.S.

went forward from Waite to Fuller, and have been projected in later differences perhaps less broad, but hardly less controversial.18 Consequently in its prohibitive, as in its affirmative or enabling, effects the history of the commerce clause has been one of very considerable judicial oscillation.

19

Moreover, the parallel encompasses the latest turn in the long-run trend. For, concurrently with the broadening of the scope for permissible application of federal authority, the tendency also has run toward sustaining state regulatory and taxing measures formerly regarded as inconsonant with Congress' unexercised power over commerce,20 and to doing so by a new, or renewed, emphasis on facts and practical considerations rather than dogmatic logistic." These facts are of great importance for dispos

18 "The categories of 'burdens' on interstate commerce, of state laws 'directly affecting' interstate commerce, etc., are natural concomitants of Marshall's doctrine. The theories as to the silence of Congress are the outgrowth of Taney's. When diverse theories cohabit, the miscegenation may produce strange progeny." Ribble, 204. For tracings of all but the latest of the various trends, see the summaries cited in note 7; see also Biklé, The Silence of Congress (1927) 41 Harv. L. Rev. 200. More recent diversities are discussed in Dowling, Interstate Commerce and State Power, 27 Va. L. Rev. 1, 8 ff. See also e. g., the different views expressed in Nippert v. Richmond, 327 U. S. 416; Southern Pacific Co. v. Arizona, 325 U. S. 761; McLeod v. Dilworth Co., 322 U. S. 327; Northwest Airlines v. Minnesota, 322 U. S. 292; and the opinions in Hooven & Allison Co. v. Evatt, 324 U. S. 652. And compare American Mfg. Co. v. St. Louis, 250 U. S. 459, with Adams Mfg. Co. v. Storen, 304 U. S. 307.

19 See note 11 and text.

20 Cf., e. g., South Carolina Highway Dept. v. Barnwell Bros., 303 U. S. 177; Western Live Stock v. Bureau of Revenue, 303 U. S. 250; McGoldrick v. Berwind-White Co., 309 U. S. 33; Nelson v. Sears, Roebuck & Co., 312 U. S. 359; California v. Thompson, 313 U. S. 109; Duckworth v. Arkansas, 314 U. S. 390; Union Brokerage Co. v. Jensen, 322 U. S. 202, 209 ff.

21 Cf. Nippert v. Richmond, 327 U. S. 416, 424, 431, notes 9 and 23, and authorities cited.

ing of such controversies. For in effect they have transferred the general problem of adjustment to a level more tolerant of both state and federal legislative action.

II.

We are not required however to consider whether, on that level, the authorities on which Prudential chiefly relies would require invalidation of South Carolina's tax. For they are not in point.

As has been stated, they are the cases which from Welton v. Missouri, 91 U. S. 275, until now have outlawed state taxes found to discriminate against interstate commerce.22 No one of them involved a situation like that now here. In each the question of validity of the state taxing statute arose when Congress' power lay dormant. In none had Congress acted or purported to act, either by way of consenting to the state's tax or otherwise. Those cases therefore presented no question of the validity of such a tax where Congress had taken affirmative action consenting to it or purporting to give it validity. Nor, consequently, could they stand as controlling precedents for such a case.

This would seem so obvious as hardly to require further comment, except for the fact that Prudential has argued

22 See note 3, and compare: "... state laws are not invalid under the Commerce Clause unless they actually discriminate against interstate commerce or conflict with a regulation enacted by Congress." Gwin, White & Prince v. Henneford, 305 U. S. 434, dissenting opinion at 446.

". . . except for state acts designed to impose discriminatory burdens on interstate commerce because it is interstate-Congress alone must 'determine how far [interstate commerce] . . . shall be free and untrammelled, how far it shall be burdened by duties and imposts, and how far it shall be prohibited.'" Id. at 455.

See also, for essentially the same position, Adams Mfg. Co. v. Storen, 304 U. S. 307, dissenting opinion; Southern Pacific Co. v. Arizona, 325 U. S. 761, dissenting opinion at 795.