Page:Health and Hospital Corp. of Marion Co. v. Talevski.pdf/61

Rh The challenge to the Social Security Act in Steward Machine Co. v. Davis, 301 U. S. 548 (1937), followed a similar pattern but reached the opposite result based on a different level of perceived coercion. As in Butler, the Federal Government defended a federal statute—here, the Social Security Act—by representing that conditions on the grant of federal funds “are not regulatory” in nature and are thus within the spending power. Brief for United States in Steward Machine Co. v. Davis, O. T. 1936, No. 837, p. 135. Seeking to avoid a repeat of its loss in Butler, the Government argued that the program was also not regulatory in fact because it did not coerce States to take or refrain from taking any actions. Brief for United States in Steward Machine Co. 100, 105–106.

This time, the Court agreed with the Government, finding that the Act was not coercive and thus did not “go beyond the bounds of” Congress’ spending power. Steward Machine Co., 301 U. S., at 591–592. Then, in rejecting a federalism challenge to the measure, the Court observed that once the State accepted the federal conditions, it was bound with even lesser force than an ordinary contract. Id., at 594–595. The State was “still free, without breach of an agreement, to change her system over night.” Id., at 595. “No officer or agency of the national Government [could] force a compensation law upon her or keep it in existence,”