Final answer:
The assertion that contracts are only illegal if specifically prohibited by statute is false. Contracts can also be illegal if they violate public policy or other legal principles. The necessary and proper clause has expanded, not limited, federal government powers.
Step-by-step explanation:
The statement 'A contract or a clause in a contract is illegal only if there is a specific statute that prohibits the action by the contract?' is false. Contracts can be deemed illegal if they involve actions that are against public policy, inherently immoral, or violate existing statutes or case law, not just specific prohibitions. Additionally, the necessary and proper clause has not limited the national government but rather expanded federal powers. This clause provides Congress the authority to make all laws necessary and proper to carry out its enumerated powers, leading to a broad interpretation of federal powers over time.
For instance, The Constitution's Article I, Section 10, Clause 1 specifically prohibits states from passing certain types of laws, like bills of attainder, ex post facto laws, or laws that interfere with legal contracts, which imposes limitations on state legislature without necessarily having a specific federal statute against each action.