{"id":30994,"date":"2016-04-04T20:33:41","date_gmt":"2016-04-05T01:33:41","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/constitution\/article1\/annotation27.html"},"modified":"2024-08-02T15:29:56","modified_gmt":"2024-08-02T20:29:56","slug":"annotation27","status":"publish","type":"constitution","link":"https:\/\/constitution.findlaw.com\/article1\/annotation27.html","title":{"rendered":"Article I, Section 8, Clause 2: Congressional Spending and Borrowing Power"},"content":{"rendered":"\n
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Article I, Section 8, Clause 2: Congressional Spending and Borrowing Power<\/h1>\n
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\n By Samuel Strom, J.D.<\/a> | Legally reviewed by Laura Temme, Esq.<\/a>\n | Last reviewed\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

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Article I, Section 8, Clause 1 grants Congress the power to tax and spend money for the general welfare of the United States. In recent years, the Supreme Court has explained the limitations to the spending power, especially with regard to the conditions Congress places on appropriations. <\/p>\n\n <\/div>\n\n

Article I<\/a> of the Constitution enumerates the powers of the legislative branch. The Constitution vests Congress, comprised of the House of Representatives and the Senate, with the legislative power of the United States.<\/p>\r\n

However, making laws<\/a> isn’t the only thing Congress does. One of its most important powers is deciding how the federal government will spend its money.<\/p>\r\n

Article I, Section 8, Clause 1 of the U.S. Constitution<\/a> is known as the "taxing and spending clause." Clause 2 is known as the "borrowing clause." Together, they grant Congress the broad power to borrow and spend money for the general welfare of the United States.<\/p>\r\n

The spending clause is among Congress’s most important powers. Through the Supreme Court’s interpretation of it, Congress has created programs such as Social Security, Medicaid, and other federal programs.<\/p>\r\n

This article summarizes the spending clause. It begins with its text and a brief explanation of its meaning. It then provides a historical background of spending clause jurisprudence. It concludes by describing several modern cases involving it.<\/p>\r\n

What Does the Constitution Say About Spending and Borrowing By Congress?<\/b><\/h2>\r\n

Article I, Section 8 enumerates the powers of Congress. It states the following:<\/p>\r\n

"The Congress shall have Power . . .<\/i><\/p>\r\n

[1] To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; . . .<\/i><\/p>\r\n

[2] To borrow Money on the credit of the United States;<\/i> . . .<\/p>\r\n

[18] To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."<\/i><\/p>\r\n

Congress’s Spending Power Explained<\/b><\/h2>\r\n

As the Court wrote in NFIB v. Sebelius<\/i><\/a> (2012) (discussed below), the spending power allows Congress to offer federal funds to states. It may also condition the offers such that states must meet specific conditions to receive the funds. This encourages states to pass certain regulations to advance federal policies.<\/p>\r\n

The spending power allows Congress to induce states to adopt policies that the federal government cannot impose directly via its enumerated powers. For example, in South Dakota v. Dole<\/i><\/a> (1987), Congress conditioned federal highway funds on states raising their drinking age to 21.<\/p>\r\n

The conditions Congress places on receipt of federal funds ensure that states use the funds to provide for the general welfare. Another way to think of the general welfare clause is that Congress must use its spending power for the good of everyone. Congress shapes the concept of "general welfare." (Helvering v. Davis<\/i><\/a> <\/i>(1937)).<\/p>\r\n

The reach of the spending power also increases, given Congress’s powers under the necessary and proper clause<\/a>, which the Supreme Court has broadly interpreted.<\/p>\r\n

As the Court wrote in McCulloch v. Maryland<\/i><\/a> (1819):<\/p>\r\n

"Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the constitution, are constitutional."<\/p>\r\n

Limits on Spending Power<\/b><\/h3>\r\n

Congress’s spending power is not unlimited. Instead, several general restrictions limit the power, including the following:<\/p>\r\n