McCulloch v. Maryland and the Foundation of Federal Authority in the Young Republic (Oxford), that makes the point that the Bank of the United States was scarcely the unambiguous "federal instrumentality" as described by Marshall. Instead, it was a bank 80% of whose stock was owned by private investors, with the remainder owned by the US. (This was a point emphasized by Jackson in his bank veto message in 1832.) The bank was instrumentally useful to attaining the policy goals of the US insofar as it provided a de facto national currency and the like, but it was in no way comparable to such full-scale federal entities as, say, the Post Office or the military. The most telling paragraph in the book is a message from the Secretary of the Treasury to the newly elected President of the 2nd Bank saying that (of course) the president's loyalties were to the shareholders, not the public (or US) in general. Milton Friedman would have been proud!

McCulloch is indeed a stunningly "aggressive decision" inasmuch as it liberates well-off investors (and speculators) from having to pay, at least indirectly, even their fair share of state revenues. (Another thing that Ellis argues is that Maryland, unlike Ohio, was not trying to run the Bank out of the state and that its demand for $15,000 in taxes was a legitimate and fair revenue measure, given the economic ravages to Maryland (and Baltimore) of the War of 1812. Marshall also avoids any mention of this in his decision, however eloquent in may be in many respects.

Similarly, Blackwater is a private business that has even more of the appurtenances of sovereignty (such as avoiding legitimate taxation, as with the Bank) than the BUS. Blackwater can apparently kill at will, without having to suffer any potential legal consequences from either the decidedly non-sovereign Iraqi government or even the ostensibly sovereign US government.

Blackwater is presumably the beneficiary of a catch-22 feature of the state action doctrine: It is, like the Bank, fundamentally an instrumentality of the US with regard to immunity from prosecution (more immune, apparently, even than the military). On the other hand, we all know that ordinary constitutional limits don't apply to Blackwater because it is a "private" organization. (Query: Will the Bush Administration invoke a "state secret' privilege with regard to any private litigation filed against Blackwater, which will presumably claim full authority to do whatever they've done (save for attempting to set up some individual "rogues" as fall guys).

One presumes that we will see greater privatization of the military, not least because We the People can, though contract, pay the Blackwater employees high salaries, whereas We the Same People, however much we profess to love our heroes in the military, are unwilling in fact to pay them what they deserve, especially with regard to medical services down the pike. An altogether depressing picture. Jack and I have been writing of the rush toward a Surveillance State. Perhaps we should add to this the concomitant rush toward the "mercenary (or Hessian) state," which will have more and more entities with literal life-and-death power not subject in any serious sense to constitutional (or, as with Blackwater, any) legal constraints.