Hamilton versus Jefferson: Commentary, Part 11

In Chapter 9 further proofs are provided in defense of my thesis the ultimate cause of Alexander Hamilton and Thomas Jefferson’s sundering was whether the national government had breached its Constitutional mandate of an autonomous federal government that was simultaneously in compliment to the various state governments while operating exclusively in international and intraunion affairs. As the sundering was Jefferson’s making, he argued that, indeed, the national government had overstepped its boundaries, and it was for Hamilton to defend otherwise. How, specifically, did Jefferson believe this mandate was breached?

In short, Jefferson suggested Hamilton and the Federalists were enacting plans for an unlimited national government that would render the states obsolete. One of the ways Jefferson offered as “proof” was the debt, and the alleged attempt to keep the nation in perpetual debt. “‘As the doctrine is that a public debt is a public blessing,’” Jefferson wrote, “‘so they think a perpetual one is a perpetual blessing, and therefore wish to make it so large as that we can never pay it off’” (p. 150). Putting aside for the moment that Hamilton and the Federalists possessed no desire whatsoever to perpetuate the national debt, even if such an allegation were true, why would it lead Jefferson to think that Hamilton was advancing an agenda whose outcome would lead to the ruin of the states?

Much as I’ve alluded to in earlier commentaries in this series, many people, both individuals within and outside the profession, perceive Hamilton and the Federalists to be mass concentrators of power. And it was no different in the Early Republic. This is what Thomas Jefferson and the Republicans believed. Among the impressions my previous commentaries should be conveying is one in which Hamilton and the Federalists are conservative and traditional in their worldview and concomitant expectations and goals, whereas Jefferson and the Republicans are surprisingly quite revolutionary and reactive when considered within the appropriate context. Because of this, Hamilton was not shy about articulating, for example, historically tried and true methods, such as a national bank, that would place him at odds with more progressive “republican” values. This conservatism made Hamilton and the Federalists unafraid to communicate aspects of British life, legality, and culture that should be emulated, while outright rejecting the entirety of the French Revolution due to its radicalism. To many, both in the Early Republic as well as today, this conservatism equates to “monarchists” and “elitists” or “oligarchs” while Jefferson and the Republicans, at least in their day, were supposed champions of “the people.”

Further justifying Jefferson’s stance (in his mind) were Hamilton’s Reports, on the national bank and on manufacturing. Each of these, in their own ways, undermined the autonomy of the states rather than complimenting them. Perhaps shockingly to perception of Jefferson, it wasn’t so much that Jefferson necessarily disagreed with Hamilton’s premise in his Report on Manufactures, for instance, but instead the means with which Hamilton proffered to fulfill his premise. In reference to Hamilton’s Report on Manufactures Holloway notes Jefferson “agreed, at least to some extent, with Hamilton’s overarching aim of encouraging American manufacturing” but vigorously disagreed with the bounty system (somewhat akin to the modern subsidy system) Hamilton espoused to encourage manufacturing (p. 153). The bounty system would, in effect, erode the principal of subsidiarity – in this context meaning, the states and local municipalities would be in the best position to determine which industries to encourage because they’re closest to them, while the bounty system would emasculate such state power. Thus, the federal government would no longer be complimentary to the states but usurpers (pp. 153-157).

Against such a backdrop, favoring debt at all would seem to indicate encroachment upon state authority, from Jefferson and Republican perspective because having debt assumes a need to facilitate payment of the debt (unless one is Thomas Jefferson – then one merely purchases indefinitely on credit and shackles his heirs with staggering financial circumstances), which is one of Hamilton’s chief aims in his Reports.

Yet, there remains one problem with my thesis I have not reconciled; namely, the theory of nullification. I mentioned this in my seventh commentary: Jefferson by the early 1790s appears to have repudiated the late 1780s version of himself. If he truly desired an autonomous federal government, complimentary to the states (the late 1780s Jefferson), and the break between he and Hamilton was Jefferson’s belief Hamilton was the head of an agenda that would contravene this Constitutional mandate, it’s unclear precisely how Jefferson’s theory of nullification and the coming Kentucky and Virginia Resolutions fit in. “The view that the Constitution was an agreement among the states, which therefore had a right to judge whether the federal government had overstepped its constitutional limitations” doesn’t seem to jive at all with any of this (157).

Hamilton versus Jefferson: Commentary, Part 8

Part 7

Part 6

Part 5

Part 4

Part 3

Part 2

Part 1

There is a perception that Hamilton and the Federalists were proponents of mass concentration of power, akin to the present-day Democratic Party. Yet, Hamilton articulated precise restrictions on federal power in his confutation of Jefferson’s Opinion on the Constitutionality of a National Bank. “As Hamilton said more than once,” Holloway writes, “the federal government is sovereign only in relation to its proper objects(p. 93). Referring back to Max Edling’s thesis, the “proper objects” in question indicate the international and intraunion Constitutional mandate of an autonomous federal government complementary to the collective state governments. But, Holloway is swift to point to a critical understanding of Hamilton’s: in order for the federal government to fulfill “its objects,” it then requires the ability, or the means, of doing so. This did not signify, however, the federal government possessed unchecked authority to do as it desired, again as the Democratic Party favors; Hamilton argued for and outlined fixed limits on national power.

First, “the means chosen must be both ‘requisite’ and ‘fairly applicable’ to the ends of the powers delegated.” In other words, the means to a particular “object” must be both appropriate and relevant. Second, the Constitution unequivocally enumerates what the federal government can and cannot do and as such, is inhibited by ‘restrictions and exceptions’ that are ‘specified in the Constitution.’” Finally, once more demonstrating the Judeo-Christian influence displayed in Farmer Refuted, Hamilton makes clear there are unambiguous boundaries beyond which secular government cannot contravene. Specially, government is constrained, at the very least, by the boundaries of morality (p. 93) (Whether Hamilton trusted in the virtue, or morals, of people is immaterial; Hamilton would still contend government is constrained by such morality regardless).

There is a related query raised by this line of argumentation; namely, the nature of “sovereignty” itself. It is incredibly abstruse political theory and difficult to follow, but Hamilton’s thinking can essentially be summarized as power is divided in the United States under the Constitution. The states claim sovereignty over some matters, and the federal government sovereignty over other matters. The same logic that Jefferson proffered to place state sovereignty over federal sovereignty, as opposed to each enjoying their own “proper objects,” could as readily work in reverse, to subordinate state sovereignty to federal sovereignty (not to keep harping on current political concerns, but as we see today). Thus,

unacceptable and ultimately absurd consequences would follow from holding that sovereignty cannot be present where power is divided or limited. “To deny that the Government of the United States has sovereign power as to its declared purposes and trusts, because its power does not extend to all cases, would be equally to deny, that the state governments have sovereign power in any case; because their power does not extend to every case.” After all, the Constitution imposes limits not only on the federal government but also on the states…. If opponents of the bank were inclined to deny the sovereignty of the federal government, they would also have to deny the sovereignty of the states. Such a denial, however, resulted in an unacceptable absurdity. If division of power excludes sovereignty, then the United States would exhibit “the singular spectacle of a political society without sovereignty, or of a people governed without government” (p. 92).

Notice the distinction Hamilton makes. He is not insinuating anarchy, for anarchy is the absence of government and rule of law. No, Hamilton is communicating something so illogical it’s never occurred in history: a functioning government in that it exists and is recognized with its corresponding rule of law, yet lacking to any claim of legitimacy or right to operate over the people that recognize it as their government…. It is incomprehensible.

Therefore, so Hamilton’s response goes, Jefferson is wrong and the states cannot claim sovereignty over the federal government, or vice versa; nor are both equally illegitimate. Rather, within their respective “objects,” each has complete sovereignty. And as a result, just as “neither Jefferson nor other critics of the bank would have ventured to deny that states possess a sovereign power to erect corporations,” so too the federal government, because as was conveyed earlier, if a government possesses “proper objects,” then it follows government requires the means of ensuring those “objects” are met. Otherwise America is simply a “political society without sovereignty” or “a people governed without government.” Furthermore, it would be entirely hypocritical, self-serving, and inconsistent to apply this logic to the state governments at the exclusion of the federal government.

Fundamentally, when one considers the divide between Hamilton and Jefferson as it first fissured in earnest over the constitutionality of a national bank, perhaps the following analogy helps to clarify matters.

When Jesus commanded to perform the various corporal and spiritual works of mercy, He never prescribed a specific methodology to do so. Humanity was tasked to reconcile its rational faculties with the historical reality of Jesus, and act in each situation accordingly.

It can be argued this is not unlike how Alexander Hamilton viewed the Constitution. Hamilton concluded morality, reason, and what could be called “common sense” were to be reconciled by Americans to the guiding “teachings” contained within the Constitution, much as Catholics use the same to reconcile the teachings and historical reality of Jesus, as well as the inspired word of God contained in the Bible. The Constitution grants the federal government the power to tax, for instance, but it fails to prescribe an explicit means to facilitate taxation. On the other hand, it could be argued Thomas Jefferson was the Protestant, the sola Scriptura-ist – the “literalist.” Just as Protestants have to make an extra-sola Scriptura argument to justify sola Scriptura itself (among others), Jefferson had to make extra-Constitutional arguments to support the majority of his positions. As an example, Jefferson “sought to impose a particular understanding of the standards by which the president should decide whether to exercise the veto” (pp. 85-88 for a discussion of Jefferson and the presidential veto). Nowhere does the Constitution specify standards for a presidential veto, merely that he has the prerogative to do so; nevertheless, Jefferson attempted to make such a Constitutional argument just the same. In such instances Jefferson is operating more like Hamilton or, to stay with the analogy, a Catholic, than with what he claims to believe.

**3/23/16**

I’ve changed the title and ceased referring to these posts as “reviews” because they aren’t properly reviews. Instead, I am now calling them “Commentaries.” I will write up a more traditional, summative review once I’ve finished the book.

Hamilton versus Jefferson: Commentary, Part 5

Part 4

Part 3

Part 2

Part 1

In Chapter 4, Carson Holloway provides evidence for my claim that Alexander Hamilton desired to fulfill the Constitutional mandate of an autonomous federal government that is nevertheless complementary to the various state governments, operating exclusively within international and intraunion affairs. (I will have to wait until the next chapter to see if Holloway offers support that purported breaching of the boundary of this mandate is the cause of the political sundering between Hamilton and Thomas Jefferson.) “Hamilton did not regard the national bank merely as a technical question or a matter of ordinary policy,” Holloway contends, “but instead, like his plan to restore public credit as an essential step in fully establishing the energetic government promised by the Constitution” (p. 57).

Using Hamilton’s Farmer Refuted as our reference point once again, “civil government” is responsible for safeguarding the “absolute rights” of the “ruled.” What are examples of these “absolute rights”? “Personal liberty,” “personal safety,” “life,” “limbs,” “property,” are all explicitly enumerated by Hamilton in Farmer Refuted. But an impotent government, by definition, cannot preserve these. And so, in Report on a National Bank, Hamilton details just how a national bank meets the international and intraunion Constitutional mandate and the object of government.

First, Hamilton argues a national bank will increase available capital. “Metal currencies…have been ‘not improperly’ called ‘dead stock’ when they are used only as a medium of exchange. Locked in a merchant’s chest, they are inert and unproductive until he encounters some opportunity to use them.” On the other hand, used as capital in a bank, they “‘acquire life, or, in other words, an active and productive quality’ arising from the ‘paper circulation’ that the bank can issue on the basis of its capital’” (p. 59). Meaning, the money Grandma puts under her mattress because she distrusts banks is doing nothing for her, for you, for the economy. If, however, she places the money in a bank (checking, savings, anything), she could potentially generate interest, the bank has additional assets from which to tender loans, the economy is stimulated because people are using the bank’s assets to buy and sell goods, and on and on it goes. A little oversimplified, but Hamilton’s point is if the federal government is to be able to adequately cope with international and intraunion concerns, then there needs to be a sufficient amount of capital flowing through the country. Yes, per his Report on Public Credit, there will be occasions when seeking a loan and “buying on credit” are necessary, but those moments should be the exception, not the rule.

Next, Hamilton, always concerned with expediency, efficiency, and the unexpected, suggested that in times of “‘sudden emergencies’” it is advantageous for the national government to be able to seek resources from a single source rather than disparate entities. Any individual’s experience as well as logic should confirm this assessment. Moreover, because a government cannot die and can raise revenue via taxation, it is among the safest and surest of borrowers for a bank (p. 60). Thus, a national bank would have no justifiable reason to refuse a loan to the federal government in a precipitous crisis.

Finally, a national bank, I’m sure to everyone’s ire, facilitates ‘“the payment of taxes.’” Why? Essentially because of Hamilton’s first reason. With greater quantities of capital comes greater fluidity of currency, and also, quite literally, it means people are not carrying around cumbersome gold and silver (p 61). So not only are loans more readily available, but paper money is freer flowing, and not because a press is printing reams of it, which depreciates the value.

The very nature of all three of these justifications for a national bank qualify as either “international” or “intraunion,” or both. Taken on their respective merits, it’s hard to disagree with Hamilton that in order to have a self-sufficient federal government there needs to be an independent national bank. Ergo, for civil government to uphold “personal liberty,” “personal safety,” “life,” “limbs,” and “property,” it must, in part, have a national bank at its disposal, though not under its control, as circumstances dictate.

**3/23/16**

I’ve changed the title and ceased referring to these posts as “reviews” because they aren’t properly reviews. Instead, I am now calling them “Commentaries.” I will write up a more traditional, summative review once I’ve finished the book.

Alexander Hamilton, Thomas Jefferson, and Max Edling’s “Mongrel Kind of Government”

 

Max Edling’s wonderful essay “‘A Mongrel Kind of Government’: The U.S. Constitution, the Federal Union, and the Origins of the American State” completely turns on its head the popular perception the Constitution of the United States is a drastic departure from the Articles of Confederation. Perceptively, Edling demonstrates the Constitution is simply the next logical step from the Articles, with only one fundamental difference between the two charter documents. Both the Articles and the Constitution limit the federal government to international and “intraunion” matters while leaving all else to the respective states. As such, the federal government was designed to “complement, not compete with, the states.”1 More pointedly, the Constitution is so similar to the Articles, Edling notes, the document merely allows “the national government to better exercise the powers it already possessed.”2

Read the rest at my Microsoft Docs: