That ruling is contrary alike to reason and precedent. To support it, the Court merely cites the following

cases:

The Lottery Case, (Champion v. Ames) 188 U. S. 321, held that an Act of Congress prohibiting transportation of lottery tickets in interstate commerce is not inconsistent with any limitation or restriction imposed upon exercise of the powers granted to Congress. After demonstrating the illicit character of lottery tickets, the Court said (p. 357): "We should hesitate long before adjudging that an evil of such appalling character, carried on through interstate commerce, cannot be met and crushed by the only power competent to that end. . . . [p. 358] It is a kind of traffic which no one can be entitled to pursue as of right."

Hipolite Egg Co. v. United States, 220 U. S. 45, held within federal power the provisions of the Food and Drug Act forbidding transportation in interstate commerce of food "debased by adulteration" and authorizing articles so transported to be seized as contraband.

Hoke v. United States, 227 U. S. 308, sustained congressional prohibition of interstate transportation of women for immoral purposes.

Brooks v. United States, 267 U. S. 432, upheld a statute of the United States making it a crime to transport a stolen automobile in interstate commerce.

Gooch v. United States, 297 U. S. 124, construed an Act of Congress making it a crime to transport a kidnapped person in interstate commerce.

Plainly these cases give no support to the view that Congress has power generally to prohibit or limit, as it may choose, transportation in interstate commerce of corn, cotton, rice, tobacco, or wheat. Our decisions establish the contrary:

Wilson v. New, 243 U. S. 332, upheld an Act regulating hours of service of employees of interstate carriers

38

BUTLER, J., dissenting.

by rail. The Court, following the teaching of earlier decisions, said (p. 346): "The extent of regulation depends on the nature and character of the subject and what is appropriate to its regulation. The powers possessed by government to deal with a subject are neither inordinately enlarged or greatly dwarfed because the power to regulate interstate commerce applies. This is illustrated by the difference between the much greater power of regulation which may be exerted as to liquor and that which may be exercised as to flour, drygoods and other commodities. It is shown by the settled doctrine sustaining the right by regulation absolutely to prohibit lottery tickets and by the obvious consideration that such right to prohibit could not be applied to pig iron, steel rails, or most of the vast body of commodities."

Hammer v. Dagenhart, 247 U. S. 251, held repugnant to the commerce clause and to the Tenth Amendment an Act prohibiting transportation in interstate commerce of articles made at factories in which child labor was employed. The Court said (p. 269): "In other words, the power [granted by the commerce clause] is one to control the means by which commerce is carried on, which is directly the contrary of the assumed right to forbid commerce from moving and thus destroy it as to particular commodities. But it is insisted that the adjudged cases in this court establish the doctrine that the power to regulate given to Congress incidentally includes the authority to prohibit the movement of ordinary commodities and therefore that the subject is not open for discussion. The cases demonstrate the contrary. They rest upon the character of the particular subjects dealt with and the fact that the scope of governmental authority, state or national, possessed over them is such that the authority to prohibit is as to them but the exertion of the power to regulate. [p. 276] In our view the necessary effect of this act is, by means of a prohibition

...

against the movement in interstate commerce of ordinary commercial commodities, to regulate the hours of labor of children in factories and mines within the States, a purely state authority. Thus the act in a twofold sense is repugnant to the Constitution. It not only transcends the authority delegated to Congress over commerce but also exerts a power as to a purely local matter to which the federal authority does not extend. The far reaching result of upholding the act cannot be more plainly indicated than by pointing out that if Congress can thus regulate matters entrusted to local authority by prohibition of the movement of commodities in interstate commerce, all freedom of commerce will be at an end, and the power of the States over local matters may be eliminated, and thus our system of government be practically destroyed."

Heretofore, in cases involving the power of Congress to forbid or condition transportation in interstate commerce, this Court has been careful to determine whether, in view of the nature and character of the subject, the measure could be sustained as an appropriate regulation of commerce. If Congress had the absolute power now attributed to it by the decision just announced, the opinions in these cases were unnecessary and utterly beside the mark.

*

For reasons above suggested, I am of opinion:

The penalty is laid on the farmer to prevent production in excess of his quota. It is therefore invalid.

*Lottery Case, 188 U. S. 321, 355 et seq. United States v. Delaware & Hudson Co., 213 U. S. 366, 415. Hipolite Egg Co. v. United States, 220 U. S. 45, 57-58. Hoke v. United States, 227 U. S. 308, 321-323. Seven Cases v. United States, 239 U. S. 510, 514. Caminetti v. United States, 242 U. S. 470, 491–492. Hammer v. Dagenhart, 247 U. S. 251, 270 et seq. Brooks v. United States, 267 U. S. 432, 436-438. See Wilson v. New, 243 U. S. 332, 346. Cf. Clark Distilling Co. v. Western Md. Ry. Co., 242 U. S. 311, 325. United States v. Hill, 248 U. S. 420. Kentucky Whip & Collar Co. v. Illinois Central R. Co., 299 U. S. 334, 346 et seq.

38

Statement of the Case.

If the penalty is imposed for marketing in interstate commerce, it is a regulation not authorized by the commerce clause.

To impose penalties for marketing in excess of quotas not disclosed before planting and cultivation is to deprive plaintiffs of their liberty and property without due process of law.

The judgment of the district court should be reversed.

MR. JUSTICE MCREYNOLDS concurs in this opinion.

UNITED STATES TRUST CO., EXECUTOR, v. HELVERING, COMMISSIONER OF INTERNAL REVENUE.

CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT.

No. 453. Argued March 3, 1939-Decided April 17, 1939.

1. An estate tax is not a tax upon the property of which an estate is composed, but is an excise upon the transfer of or shifting in relationships to property at death. P. 60.

2. The proceeds of a War Risk Insurance policy payable to a deceased veteran's widow were properly included in his gross estate for the purpose of computing the federal estate tax. Revenue Act of 1926, § 302 (g), as amended. P. 60.

3. Section 22 of the World War Veterans' Act, 1924, providing that such insurance "shall be exempt from all taxation," does not prevent. P. 59.

4. No provision of the Government's contract with an insured veteran is impaired in violation of the Fifth Amendment by the inclusion in his gross estate of proceeds of a War Risk Insurance policy for the purpose of computing the federal estate tax. P. 60. 98 F. 2d 734, affirmed.

CERTIORARI, 305 U. S. 591, to review the affirmance of a decision of the Board of Tax Appeals sustaining a determination of a deficiency in federal estate tax.

Opinion of the Court.

Mr. Wilder Goodwin for petitioner.

307 U.S.

Mr. J. Louis Monarch, with whom Solicitor General Jackson, Assistant Attorney General Morris, and Messrs. Sewall Key and Edward J. Ennis, and Helen R. Carloss were on the brief, for respondent.

MR. JUSTICE BLACK delivered the opinion of the Court.

The sole question is whether proceeds of a War Risk Insurance policy payable to a deceased veteran's widow were properly included in his gross estate under a federal estate tax.

The federal estate tax in question 1 included in a decedent's gross estate the amount in excess of forty thousand dollars received by "beneficiaries [other than his estate] as insurance under policies taken out by the decedent upon his own life." This veteran's total life insurance for beneficiaries other than his estate exceeded at death the statutory exemption of forty thousand dollars, if his War Risk Insurance policy payable to his widow in the sum of ten thousand dollars is included. The Commissioner assessed an estate tax measured by this excess. As decedent's executor, petitioner claimed that proceeds of the War Risk Insurance policy could not be included in the estate because of § 22 of the World War Veterans' Act, 1924, providing that such "insurance . . . shall be exempt from all taxation." The Board of Tax Appeals upheld the determination of the Commissioner, and the Circuit Court of Appeals affirmed.3

1

'§ 302 (g) Revenue Act of 1926, as amended.

243 Stat. 607, 613.

98 F. 2d 734. State courts have differed as to whether proceeds of War Risk Insurance are subject to death duties imposed by the States. See, for example, In re Estate of Harris, 179 Minn. 450; 229 N. W. 781; Tax Commission v. Rife, 119 Oh. St. 83; 162 N. E.