"All these rights exist in the United States for constitutional purposes, and without a special cession of jurisdiction; though it is admitted that other powers over the property and persons on such lands will, of course, remain in the States, till such a cession is made. Nothing passes without such a cession, except what is an incident to the title and purpose of the General Government."[77]
The Supreme Court give great eminence to the sovereign right of taxation in the States, saying:—
"Taxation is a sacred right, essential to the existence of Government,—an incident of sovereignty. The right of legislation is coextensive with the incident, to attach it upon all persons and property within the jurisdiction of a State."[78]
And again, the Court say in another case:—
"However absolute the right of an individual may be, it is still in the nature of that right that it must bear a portion of the public burdens, and that portion must be determined by the Legislature."[79]
In the same case, the Court, after declaring "that the taxing power is of vital importance,—that it is essential to the existence of Government,—that the relinquishment of such a power is never to be assumed," add, cautiously, that they "will not say that a State may not relinquish it,—that a consideration sufficiently valuable to induce a partial release of it may not exist."[80]
While thus upholding the right of taxation as one of the precious attributes belonging to the States, the Court, under the Constitution of the United States, properly exempt instruments and means of government; but they limit the exemption to these instruments and means. Thus it is expressly decided in a celebrated case,[81] that, while the Bank of the United States, being one of the necessary instruments and means to execute the sovereign powers of the nation, is not liable to taxation, yet the real property of the Bank is thus liable, in common with other real property in a particular State.
Now the lands held by the United States do not belong to instruments and means necessary and proper to execute the sovereign powers of the nation. In this respect they clearly differ from fortifications, arsenals, and navy-yards. They are strictly in the nature of private property belonging to the nation and situated within the jurisdiction of States. In excusing them from taxation, our fathers acted unquestionably according to the suggestions of prudence, but also under the influence of precedent, derived at that time from the prerogatives of the British Crown. It was an early prerogative, transmitted from feudal days, when all taxes were in the nature of aids and subsidies to the monarch, that the property of the Crown, of every nature, should be exempt from taxation. But mark the change. This ancient feudal principle is not now the law of England. By the statute of 39 and 40 George III., chap. 88, passed thirteen years after the Ordinance of 1787, the lands and tenements purchased by the Crown out of the privy purse or other moneys not appropriated to any public service, or which came to the King from his ancestors or private persons,—in other words, lands and tenements in the nature of private property,—are subjected to taxation even while they belong to the Crown.
Thus the matter stands. Lands belonging to the nation, which, it seems, even royal prerogative at this day in England cannot save from taxation, are in our country, under express provisions of compact, early established, exempted from this burden. Now, Sir, I make no complaint; I do not suggest any change, nor do I hint any ground of legal title in the States. But I do confidently submit, that in this peculiar, time-honored immunity, originally claimed by the nation, and conceded by the States within which the public lands lie, there is ample ground of equity, under which these States may now appeal to the nation for assistance out of these public lands.