Helvering v. Davis
| Helvering v. Davis | |
|---|---|
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| Argued May 5, 1937 Decided May 24, 1937 |
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| Full case name | Guy T. Helvering, Commissioner of Internal Revenue v. Davis |
| Citations | 301 U.S. 619 (more) |
| Holding | |
| The proceeds of both the employee and employer taxes are to be paid into the Treasury like any other internal revenue generally, and are not earmarked in any way. | |
| Court membership | |
| Case opinions | |
| Majority | Cardozo, joined by Hughes, Brandeis, Stone, Sutherland, Van Devanter, and Roberts |
| Dissent | McReynolds, joined by Butler |
Helvering v. Davis, 301 U.S. 619 (1937), was a decision by the United States Supreme Court, which held that Social Security was constitutionally permissible as an exercise of the federal power to spend for the general welfare, and did not contravene the 10th Amendment. The Court's 7-2 decision defended the constitutionality of the Social Security Act of 1935, requiring only that welfare spending 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.
A shareholder of the Edison Electric Illuminating Company brought a derivative action to restrain the company from making payments and deductions required by the Social Security Act 1935 on the ground that it was unconstitutional. He sought an injunction, and a declaration that the Act was void.
The Opinion of the Supreme Court in the case was written by Justice Benjamin N. Cardozo. This decision supported the right of the Congress to interpret the "general welfare" clause in the U.S. Constitution.
[...]
Congress did not improvise a judgment when it found that the award of old age benefits would be conducive to the general welfare. The President's Committee on Economic Security made an investigation and report, aided by a research staff of Government officers and employees, and by an Advisory Council and seven other advisory groups. Extensive hearings followed before the House Committee on Ways and Means, and the Senate Committee on Finance. A great mass of evidence was brought together supporting the policy which finds expression in the act... The evidence is impressive that, among industrial workers, the younger men and women are preferred over the older. In times of retrenchment, the older are commonly the first to go, and even if retained, their wages are likely to be lowered. The plight of men and women at so low an age as 40 is hard, almost hopeless, when they are driven to seek for reemployment. Statistics are in the brief. A few illustrations will be chosen from many there collected. In 1930, out of 224 American factories investigated, 71, or almost one third, had fixed maximum hiring age limits; in 4 plants, the limit was under 40; in 41, it was under 46. In the other 153 plants, there were no fixed limits, but in practice few were hired if they were over 50 years of age. With the loss of savings inevitable in periods of idleness, the fate of workers over 65, when thrown out of work, is little less than desperate. A recent study of the Social Security Board informs us that
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