Salmon P. Chase

“ There are those, however, who assert that, although the States cannot tax the exercise of the powers of the government, as for example in the conveyance of the mails, the transportation of troops, or the borrowing of money, they may tax the indebtedness of the government when it assumes the form of obligations held by individuals, and so becomes in a certain sense private property. ”

“ The principle of exemption is, that the States cannot control the national government within the sphere of its constitutional powers-for there it is supreme-and cannot tax its obligations for payment of money issued for purposes within that range of powers, because such taxation necessarily implies the assertion of the right to exercise such control.
The certificates of indebtedness, in the case before us, are completely within the protection of this principle. ”

“ Evidences of the indebtedness of the United States, held by individuals or corporations, and sometimes called stock or stocks, but recently better known as bonds or obligations, have uniformly been held by this court not to be liable to taxation under State legislation.
The authority to borrow money on the credit of the United States is, in the enumeration of the powers expressly granted by the Constitution, second in place, and only second in importance to the authority to lay and collect taxes. Both are given as means to the exercise of the functions of government under the Constitution ”