Politically Incorrect Guide To The Constitution (Politically Incorrect Guides) (12 page)

During the long, hot summer of 1787, as the Constitution was being written in Philadelphia, George Washington loomed large over the debates.
He was the presiding officer at the Convention, but he did not often
speak. Nevertheless, the understanding that he would serve as the first
president of the United States guided the constitutional design of the
executive branch. The delegates trusted him to behave-as he had during the Revolution and since-as a dedicated republican.

Partly at James Madison's recommendation, Washington made his former Continental Army aide-de-camp Alexander Hamilton the first secretary of the treasury. This brilliant admirer of the British constitution also
admired the British financial system established earlier in the century by
eminent Whig politician Robert Walpole. Hamilton proposed to replicate
it, so far as was possible, in America.

Others, wary of Walpole's example and suspicious of Hamilton's
republican bona fides, sniffed out monarchist plotting and determined to
stop it. Some of these people, influenced by anti-Walpole British writers,
resolved to oppose the new government in its early days, whatever it did.
John Taylor of Caroline, for example, said that the course of a government
is established at its beginnings, so the federal government's every move
had to be eyed suspiciously. If it were allowed to set out on a career of
exercising powers not expressly granted by the Constitution, it would
eventually careen further and further from the pure republicanism of the
Revolution.

Secretary Hamilton, like Washington, had suffered hardship, cold, and
hunger at Valley Forge. Like his chief, he had seen the Continental Army constantly short of men and money. There must be a stronger federal government, he believed, so that in the event of future wars-and there
would be future wars-government credit would be good. Then men and
supplies would be plentiful. No American soldier would ever freeze to
death in his winter quarters again. The United States would be able to
defend themselves even in the absence of a French king willing to go
bankrupt on their behalf.

As treasury secretary, then, Hamilton proposed a number of measures
to solidify the financial structure. He had the first Congress assume
responsibility for the debts incurred by the states in fighting the Revolution and persuaded Congress to fund a portion of the debt. The Virginia
House of Delegates, under the leadership of Patrick Henry-the Old
Dominion's foremost revolutionary figure and undisputed master of the
all-powerful General Assembly-adopted a formal resolution decrying
this assumption and funding of the states' debts as unconstitutional. Joining Henry was Henry Lee, who had helped lead the Federalists against
him in the Richmond Ratification Convention. The federal government,
they said, had not been expressly granted power to undertake any such
measures, and so they were unconstitutional. Not only was the General
Assembly suspicious of the federal government, but it was also prepared
to resist it. (These were the same men, after all, who had made war on
England less than a decade earlier on very similar grounds.) Hamilton,
however, cut a deal with the Virginians, placing the federal capital
between their state and Maryland in exchange for Virginia's accepting his
debt assumption program.

Thomas Jefferson, as America's diplomat to France, had been absent
during the writing and ratification of the Constitution, but he was a leading Republican voice on his return. In 1791, he joined James Madison
(Virginia's leading Federalist, after Washington) in opposing another of
Hamilton's financial measures. This one was intended to create an American version of the Bank of England to manage the government's debt.

But in the U.S. House of Representatives, to Hamilton's surprise, Madison classified the bill as unconstitutional. He noted that nothing in Article I, Section 8-where Congress's powers are enumerated-gave
Congress power to create any kind of corporation, including a bank.

Congress nevertheless passed the bill incorporating a bank. President
Washington then asked his cabinet-which included Edmund Randolph,
Hamilton, and Jefferson-whether they thought Madison was right about
the bill being unconstitutional. Jefferson responded with a classic affirmation of what the Constitution actually says and means.

The underlying principle of the Constitution, Jefferson wrote, is that
"the powers not delegated to the United States by the Constitution, nor
prohibited by it to the States, are reserved to the States respectively, or to
the people." This is the language of the Tenth Amendment, whichalthough not yet ratified-had already been passed out of Congress.

How did one know if a power had been delegated to Congress by the
Constitution? Jefferson looked at the list of Congress's powers in Article
I, Section 8. There was nothing there about chartering corporations, let
alone banks, so Congress had no such power. This meant, Jefferson said,
that the power to charter banks remained in the state legislatures, where
it had been before the Constitution was adopted.

Jefferson then turned to the so-called elastic clause, the Necessary and
Proper Clause at the end of Article I, Section 8. It says that Congress has
the power "to make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers [the previously enumerated
powers of Congress], and all other Powers vested by this Constitution in
the Government of the United States, or in any Department or Officer
thereof." Supporters of the bank argued that under this clause Congress
could charter a national bank. Jefferson countered that chartering a bank
was not "necessary" to carry out any of Congress's enumerated powers,
and thus was not permitted by the Necessary and Proper Clause. Attorney General Edmund Randolph concurred with Jefferson.

What a Patriot
Said

"I wish it were possible to
obtain a single amendment
to our constitution. I would be willing to
depend on that alone for the reduction of the
administration of our government to the genuine principles of its constitution; I mean an
additional article, taking from the federal government the power of borrowing."

Thomas Jefferson, in a letter to
John Taylor, November 26,1798

Hamilton, in rebuttal to Jefferson, made the classic argument for conceding to Congress nearly untrammeled discretion under the Constitution.
Hamilton argued that clauses within Article I, Section 8 granted Congress
powers related to the economy (such as the power to regulate trade with
foreign countries, the power to regulate trade among the states, the power
to regulate trade with the Indian tribes, the power to coin money, and so
on). These clauses, taken together, reflected a mandate to Congress to
supervise the national economy. Only it could decide how to do so. The
Necessary and Proper Clause, according to Hamilton, granted Congress
discretion in this regard. Contrary to Jefferson's argument, Hamilton stated
that "necessary" did not really mean necessary, but that it might mean "helpful,"
"useful," or "convenient"-or, one supposes, "desired." There was nothing in the
Constitution prohibiting Congress from
chartering a corporation, Hamilton noted.
Where the ends were constitutional and
the means not prohibited, the means were
constitutional.

Note the distinction between Jefferson's
approach and Hamilton's. Jefferson started
with the assumption that Congress has
only those powers that are expressly delegated to it. (This was also what such leading Federalists as James Wilson, Edmund
Randolph, and Charles Cotesworth Pinckney argued in 1787-1788.) Hamilton, on
the other hand, started with the assumption that Congress was analogous
to the British Parliament in having all powers the Constitution did not
expressly deny it. This suited Hamilton's desire that the United States
copy the British system (which he regarded as the most successful in the world), but it was a model of congressional authority that the Philadelphia
Convention had rejected when it rejected the nationalist Virginia Plan.
Moreover, it was directly at odds not only with the Tenth Amendment
(and later, the Eleventh Amendment), but with much of what Hamilton
had written in his confused contributions to The Federalist. Washington,
a nationalist, eventually followed Hamilton's advice by signing the bank
bill.

When the French Revolution began in 1789, Washington and many (but
not all) Americans responded with cautious optimism. When Washington's friend the Marquis de La Fayette sent him the key to the Bastille, he
put it on his mantle at Mt. Vernon-where it remains today.

In time, however, the Revolution took a most unsavory turn (as Gouverneur Morris, on site in Paris as American minister to the French court,
had predicted from the start). The king was deposed, then killed, as was
his queen. France eventually became involved in a series of first defensive, then aggressive wars, and the kingdom's traditional Catholicism was
replaced by a new pagan religion of "Reason."

As France became embroiled in a world war against Britain (and other
leading European powers), Hamilton, as treasury secretary, wanted to stay
out of the mess entirely. America was far too weak to determine the outcome and could only hurt itself by becoming involved. Besides that, taking France's side would mean an interruption of trade with England-still
America's chief trading partner. As federal tax revenue came mainly from
tariffs (taxes on imports), interruption of foreign trade threatened the new
government's financial future-and thus all Hamilton's plans for American credit.

Secretary of State Thomas Jefferson made two main points regarding
America's stance: first, America had since 1778 been under treaty obliga tion to come to France's assistance if it were attacked. France had lived
up to its side of the mutual defense treaty during the American Revolution, and if the United States did not reciprocate, France would have
every moral and-under the law of nations-legal right to exact retribution militarily.

Hamilton said that the treaty in question had been between the United
States and Louis XVI, who had been deposed in 1792. Thus, America was
under no moral or legal obligation to assist France; in his view, the treaty
had lapsed. Jefferson responded that it was for France to choose its form
of government. True, we had entered into the treaty with the French
monarch, but he had been the country's chief executive; if the French had
chosen to replace their monarchy with a republic, how could the Americans criticize them for that?

Washington finally, in effect, opted for Hamilton's position. He issued
a public proclamation that any American citizen who aided either side
in the war would be prosecuted. For Jefferson, Madison, John Taylor of
Caroline, and their Republican followers, the president's proclamation
was an executive branch usurpation: the president was to execute policy,
not make it. Madison wrote that this was only the latest attempt of the
Federalists to assimilate the American constitution to the British one. In
Britain, unlike in America, it was up to the king to declare war, to conclude treaties, and otherwise to make foreign policy. Madison went further and accused Hamilton (and pro-British Federalists) of being
monarchist.

Republican clubs existed across the United States. Republicans celebrated partisan holidays-the Fourth of July was associated with Republican leader Jefferson-and they held dinners and parades in support of
their party and of republican France. Partisan tension marked life within
all the states and also among them.

With that in mind, in 1794 two northern U.S. senators, New York's
Rufus King (later a Federalist presidential nominee) and Connecticut's Oliver Ellsworth (later chief justice of the United States), buttonholed Virginia's John Taylor of Caroline and tried to convince him that the political divide between North and South was irreparable, and that they
should broker a permanent scission of the Union. Taylor rejected the idea,
saying that if Hamilton's financial program were repealed, inter-sectional
grievances would end. But the idea of dividing the Union stayed in Taylor's mind, as we'll see.

The year 1794 also witnessed the Whiskey Rebellion. In adopting Secretary Hamilton's financial proposals, the first Congress had imposed excise
taxes on carriages and whiskey. It seems that the latter was a kind of "sin
tax," but many Americans did not consider whiskey an optional component of their lives. Farmers in western districts who grew wheat could eat
only so much of it, and transporting wheat to market on crude western
roads was often impracticable. So they converted it to whiskey.

The excise, then, fell hardest on those least able to afford it: farmers in
remote districts. Hamilton, however, saw the rebellion as a wonderful
opportunity. By assuming the states' debts and paying the federal government's debt obligations on time, he hoped to convince foreigners that the
United States government was a good credit risk. Using armed force to
collect the whiskey excise could only improve America's credit rating.