exercise its powers so as not to interfere with the free and full
exercise by the other of its powers. To do otherwise would be contrary
to the fundamental compact embodied in the Constitution--in other words,
it would be _unconstitutional_.

This proposition was affirmed at an early day by Chief Justice John
Marshall in the great case of _McCulloch vs. The State of Maryland_,[1]
which involved the attempt of a state to tax the operations of a
national bank. That case is one of the landmarks of American
constitutional law. While it did not expressly decide that the Federal
Government could not tax a state instrumentality but only the converse,
i.e., that a state could not tax an instrumentality of the nation, the
Court has held in many subsequent decisions that the proposition
enunciated by the great Chief Justice works both ways. For example, it
has declared that a state cannot tax the obligations of the United
States because such a tax operates upon the power of the Federal
Government to borrow money[2] and conversely, that Congress cannot tax
the obligations of a state for the same reason;[3] that a state cannot
tax the emoluments of an official of the United States[4] and
conversely, that the United States cannot tax the salary of a state
official;[5] that a state cannot impose a tax on the property or
revenues of the United States[6] and conversely, that Congress cannot
tax the property or revenues of a state or a municipality thereof.[7]

[Footnote 1: 4 Wheaton, 316.]

[Footnote 2: _Weston v. City of Charleston_, 2 Pet., 449.]

[Footnote 3: _Mercantile Bank v. New York_, 121 U.S., 138, 162.]