Archive for the ‘Alexander Hamilton’ Category

A Free Reprint of The Federalist Papers

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24 Nov 2011

Dear Readers:

The Federalist Papers are a series of 85 essays by James Madison, Alexander Hamilton, and John Jay published from the fall of 1787 to the spring of 1788.  Their purpose was to explain and defend the newly-crafted U. S. Constitution (intended to supercede the Articles of Confederation)  during the ratification debate in New York.  In the course of these essays, these three founding fathers discuss the philosophy of limited government with necessary powers, the separation of powers between the states and the federal government, and how these were implemented in the Constitution.

It is important for those who believe in limited government to read and understand the Federalist Papers.  They are as relevant today as they ever were.  Page 2 of the reprint (available in pdf only due to its length) contains a  commercial for a book that will help you understand it better; I hope you will consider that too.

The Federalist is in the public domain, and there is nothing copyrighted in this reprint.  Please distribute it as you see fit.

Thanks for reading,

Ed Duvall

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The Defects of the Articles of Confederation, Part 14

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The Articles of Confederation were initially proposed in the wartime emergency of 1775-1776 and were ratified by all the states by 1781; but the structure of the Confederation was not conducive to long-term stability.  Congress was granted certain powers under the Articles: a) to determine the amount of requisitions each state was to pay; b) to declare war and make peace; c) to send and receive ambassadors to foreign nations; d) to negotiate and ratify treaties; e) to determine rules for disposition of captures at sea; f) to grant letters of marque (authorizing private piracy on behalf of the U. S.); g) to convene courts for trials of crimes committed at sea; h) to be the appeal of last resort in disputes between the states; i) to regulate coinage issued by Congress or by the states; j) to establish uniform weights and measures throughout the United States; k) to regulate trade with the Indian tribes; l) to create post offices; m) to exercise overall command and control of the military forces; n) to appoint some officers in the army and all in the navy; and o) to commission all officers in the service of the United States.

One major difficulty was that Congress did not have the ability to regularly enforce any of its laws nor the means to punish violations of them.  This series of essays has presented considerable evidence to that effect, especially concerning Congress’ inability to maintain an army, raise revenue, ensure adherence to treaties, manage territories, respond to foreign policies, or regulate commerce.  A stable government must, as a minimum, have an executive function to enforce its laws and a judicial system to punish violations of valid laws and to interpret the law itself.

Alexander Hamilton addressed both of these problems in The Federalist Papers.  First, in No. 21, he cites Congress’ inability to enforce any of its laws:

The next most palpable defect of the subsisting Confederation, is the total want of a SANCTION to its laws. The United States, as now composed, have no powers to exact obedience, or punish disobedience to their resolutions, either by pecuniary mulcts, by a suspension or divestiture of privileges, or by any other constitutional mode.  There is no express delegation of authority to them to use force against delinquent members; and if such a right should be ascribed to the federal head, as resulting from the nature of the social compact between the States, it must be by inference and construction, in the face of that part of the second article, by which it is declared, “that each State shall retain every power, jurisdiction, and right, not expressly delegated to theUnited States in Congress assembled.”  There is, doubtless, a striking absurdity in supposing that a right of this kind does not exist, but we are reduced to the dilemma either of embracing that supposition, preposterous as it may seem, or of contravening or explaining away a provision, which has been of late a repeated theme of the eulogies of those who oppose the new Constitution; and the want of which, in that plan, has been the subject of much plausible animadversion, and severe criticism.  If we are unwilling to impair the force of this applauded provision, we shall be obliged to conclude, that the United States afford the extraordinary spectacle of a government destitute even of the shadow of constitutional power to enforce the execution of its own laws.  It will appear, from the specimens which have been cited, that the American Confederacy, in this particular, stands discriminated from every other institution of a similar kind, and exhibits a new and unexampled phenomenon in the political world.

 Hamilton then discusses in No. 22, the lack of a judicial system:

A circumstance which crowns the defects of the Confederation remains yet to be mentioned, — the want of a judiciary power.  Laws are a dead letter without courts to expound and define their true meaning and operation.  The treaties of theUnited States, to have any force at all, must be considered as part of the law of the land.  Their true import, as far as respects individuals, must, like all other laws, be ascertained by judicial determinations.  To produce uniformity in these determinations, they ought to be submitted, in the last resort, to one SUPREME TRIBUNAL.  And this tribunal ought to be instituted under the same authority which forms the treaties themselves.  These ingredients are both indispensable.  If there is in each State a court of final jurisdiction, there may be as many different final determinations on the same point as there are courts.  There are endless diversities in the opinions of men.  We often see not only different courts but the judges of the came court differing from each other.  To avoid the confusion which would unavoidably result from the contradictory decisions of a number of independent judicatories, all nations have found it necessary to establish one court paramount to the rest, possessing a general superintendence, and authorized to settle and declare in the last resort a uniform rule of civil justice.

In reviewing the chronicle of the Constitutional Convention, it is interesting to note that there was no serious debate about whether an executive or judicial branch should exist.  The need for them was pretty much accepted by all the attendees; the main debates were about the exact form, how they would be constituted, and what specific powers they would have.  There were some who thought an executive council would carry out the executive function better than a single officer; some preferred a system by which the judicial system would be combined with the legislative; some thought all proposed laws by the legislative should be reviewed and modified by the executive and judicial branches.  In the end, the framers developed a Constitution that created three main branches of the federal government, each with defined powers and the means to defend itself from encroachment by the other two.  The framers employed methods to ensure that the executive (President) and judicial branches were separate from each other and independent of the legislative.  There are some areas of overlap between the executive and the legislative (power of making treaties), and considerable influence of both of these upon the judicial branch (nomination of judges by the President and confirmation by the Senate).

The powers granted to the President are: a) to be Commander-in-Chief of the military; b) to be the point of contact for all foreign dignitaries as the nominal head of state; c) to negotiate treaties (but not to ratify them); d) to nominate ambassadors, judges, and certain other offices subject to Senate confirmation; e) to serve as chief administrator over the government departments that enforce the laws made by Congress; and f) to make lower-level appointments in his executive branches charged with those enforcement tasks.

The general power granted to the federal judicial system is to hear all cases in law and equity arising from treaties, federal laws, and the Constitution itself.  The powers are divided as follows: a) creation of a Supreme Court which is to have original jurisdiction in cases affecting ambassadors, public officials, and when a state is a party; and b) creation of lower federal courts to hear cases for which the Supreme Court does not have original jurisdiction.  In all cases, the Supreme Court has an appellate jurisdiction to hear appeals from lower federal courts.

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The Defects of the Articles of Confederation, Part 12

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Change is the one unchanging constant of human history.  By way of application, it must be admitted that any rules for governance among people must contain a provision by which those rules may be altered in an orderly fashion in order to accommodate changing conditions.  The Articles of Confederation contained such a provision as follows:

Article XIII.  Every State shall abide by the determinations of the United States, in Congress assembled, on all questions which by this Confederation are submitted to them. And the Articles of this Confederation shall be inviolably observed by every State, and the Union shall be perpetual; nor shall any alteration at any time hereafter be made in any of them, unless such alteration be agreed to in a Congress of the United States, and be afterwards confirmed by the legislatures of every State.

The concurrence of every state legislature was required to make any change in the Articles.  Part 9 of this series discussed the main problem with the revenue provisions of the Articles, namely that Congress was entirely dependent on the states through the requisition system.  But the Articles could not be amended, because one state (New York) refused to permit Congress a power to establish an independent revenue source to meet the needs at the national level.  The conflict over Congress’ revenue started on 3 Feb 1781, when Congress, realizing that the requisition system was not working, recommended that the Articles be amended to allow Congress to impose an import duty.  With such a power, Congress could raise revenue necessary to perform its minimum duties, such as paying the army. Rhode Island was the first to reject the concept on 1 Nov 1782, arguing among other things, that the revenue collectors would not be answerable to Rhode Island. Virginia was initially in favor of the import duty, but revoked its agreement on 11 Jun 1783.  But in that same month, Delaware and New Jersey agreed to it; South Carolina followed suit on 13 Aug 1783 but with difficult caveats; Massachusetts concurred on 16 Oct 1783; Virginia reversing itself once again in favor on 29 Dec 1783; North Carolina agreed on 2 Jun 1784; and New Hampshire agreed on 23 Jun 1785.  All the other states except New York did likewise by May 1786.

But the government of the state of New York, interested only in its own revenues, refused to allow Congress to impose any import duties.  On 16 Aug 1786, Governor Clinton of New York notified Congress that he would not call the state legislature into session to consider the proposal; although Congress was desperate for money, he did not consider the situation important enough.  On 15 Feb 1787, New York gave its final refusal to consider the matter.  This proved fatal to the Confederation, as Congress realized it now had no hope of a stable revenue stream.  It caused Congress endorse the idea of a convention of the states to modify the Articles, which became the convention that wrote the Constitution.

The Constitution permits amendments in a manner superior to the Articles of Confederation:

[Article V]  The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress; Provided that no Amendment which may be made prior to the Year One thousand eight hundred and eight shall in any Manner affect the first and fourth Clauses in the Ninth Section of the first Article; and that no State, without its Consent, shall be deprived of its equal Suffrage in the Senate.

Under this provision, amendments to the Constitution may be initiated in two ways: a) if two-thirds of both Houses of Congress pass an amendment; or b) if two-thirds of the states call for a convention for the purpose of proposing amendments.  In each case, concurrence of three-fourths of the states, either by their legislatures or by ratifying conventions, is required before such proposed amendments take effect.

James Madison defended this provision in The Federalist #43:

That useful alterations will be suggested by experience, could not but be foreseen. It was requisite, therefore, that a mode for introducing them should be provided. The mode preferred by the convention seems to be stamped with every mark of propriety. It guards equally against that extreme facility, which would render the Constitution too mutable; and that extreme difficulty, which might perpetuate its discovered faults. It, moreover, equally enables the general and the State governments to originate the amendment of errors, as they may be pointed out by the experience on one side, or on the other.

Alexander Hamilton answered critics of the provision, and gave his opinion on the nature of amendments were they to occur, in The Federalist #85:

In opposition to the probability of subsequent amendments, it has been urged that the persons delegated to the administration of the national government will always be disinclined to yield up any portion of the authority of which they were once possessed.  For my own part I acknowledge a thorough conviction that any amendments which may, upon mature consideration, be thought useful, will be applicable to the organization of the government, not to the mass of its powers; and on this account alone, I think there is no weight in the observation just stated.  I also think there is little weight in it on another account.  The intrinsic difficulty of governing thirteen States at any rate, independent of calculations upon an ordinary degree of public spirit and integrity, will, in my opinion constantly impose on the national rulers the necessity of a spirit of accommodation to the reasonable expectations of their constituents.  But there is yet a further consideration, which proves beyond the possibility of a doubt, that the observation is futile.  It is this that the national rulers, whenever nine States concur, will have no option upon the subject.  By the fifth article of the plan, the Congress will be obliged “on the application of the legislatures of two thirds of the States [which at present amount to nine], to call a convention for proposing amendments, which shall be valid, to all intents and purposes, as part of the Constitution, when ratified by the legislatures of three fourths of the States, or by conventions in three fourths thereof.”  The words of this article are peremptory. The Congress “shall call a convention.”  Nothing in this particular is left to the discretion of that body.  And of consequence, all the declamation about the disinclination to a change vanishes in air.  Nor however difficult it may be supposed to unite two thirds or three fourths of the State legislatures, in amendments which may affect local interests, can there be any room to apprehend any such difficulty in a union on points which are merely relative to the general liberty or security of the people.  We may safely rely on the disposition of the State legislatures to erect barriers against the encroachments of the national authority.

Hamilton was almost right when he wrote that subsequent amendments would mostly change the organization of the government, not its powers.  In fact, the first ten Amendments confirmed the existing rights of the people and the states relative to the federal government, thus expressly limiting the federal government’s power if there was any room for doubt among rational people.  There are only two cases where the federal government expanded its powers by amending the Constitution. The first was the patently moronic Prohibition (Amendment 18, subsequently repealed by Amendment 21), which led to the rise to a permanent criminal class with the means and willingness to corrupt the government.  Although alcohol prohibition was repealed, it was replaced with other equally detrimental prohibitions that have kept the criminal elite employed for decades.  The second case of an expansion of power is Amendment 16, which gave Congress a power to tax incomes.

In general, this method of amendment has the virtue of making amendments fairly difficult, thus enhancing the stability of the Constitution.  At the same time it permits necessary amendments, but only if a great majority of the people, acting through their state legislators or conventions, agree to it.  It has proven over time to be a most beneficial system, since very few of the numerous and ridiculous proposed amendments ever come to the states for consideration — they die in Congress as they deserve.

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The Defects of the Articles of Confederation, Part 9

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Every viable government must possess the means to fulfill its duties and to keep its promises.  A national or federal government, whether it is a republic, aristocracy, or some other, naturally has the duty to manage the nation’s defenses, engage in diplomacy, manage trade relations, and maintain a judicial system; all these must be paid for in some way or another.  In the American system, the states likewise exercise many powers for which considerable revenue is required, and so on down to the local level. Our early history instructs us on one thing in particular with regard to finances: a government must have the financial means to execute its respective powers and duties.  It cannot, in the long run, depend on another level of government for money; it will become captive to the interests and prejudices of the politicians and bureaucrats within the other government entity.  A prime example of this principle is contained in the most serious defect of the Articles of Confederation: Congress, as the only federal power, was dependent entirely on the states for revenue.  This disconnect caused a radical divergence between need and ability: Congress’ needs were great, even after the war, but the states, attending to their own problems, soon found ready excuses not to meet their financial obligations to Congress.  By the mid-1780’s, Congress had neither credit nor credibility, and the thinkers of that time realized that Congress’ lack of a revenue stream caused many other problems.  If the states were to stay together, a more consistent federal government would be required, and that government must have its own independent revenue source.

At the beginning of the Revolutionary War, Congress assumed emergency powers to manage the war effort.  Although the Articles of Confederation were proposed and debated from 1776 to 1778, they did not actually go into operation until the spring of 1781.  Congress attempted to fund the war effort prior to the implementation of the Articles by three means: borrowing, issuing its own currency, and asking requisitions from the states.  The first two will form the subject of the next essay, but the last will be considered here since it emulates so closely the provision in Article VIII of the Confederation:

Article VIII.  All charges of war, and all other expenses that shall be incurred for the common defence or general welfare, and allowed by the United States, in Congress assembled, shall be defrayed out of a common treasury, which shall be supplied by the several States, in proportion to the value of all land within each State, granted to, or surveyed for, any person, as such land and the buildings and improvements thereon shall be estimated according to such mode as the United States in Congress assembled, shall from time to time direct and appoint.  The taxes for paying that proportion shall be laid and levied by the authority and direction of the legislatures of the several States, within the time agreed upon by theUnited States, in Congress assembled.

Under this system, Congress allocated to each state a requisition, based on an estimate of the total value of land and buildings.  The state was obligated to raise this sum by internal taxation, which was then to be forwarded to Congress.  The system never worked as envisioned, and the proof of it lies in these facts.  In the following, all amounts have been converted to Spanish milled dollars, a coin in common use at the time, which was reckoned at 386.7 grains of pure silver.

First, consider requisitions issued by Congress prior to the ratification of the Articles of Confederation:

22 Nov 1777:  Congress issued a recommendation that the states raise $5,000,000, apportioned according to population, to be paid in quarterly installments starting 1 Jan 1778 to pay the expenses for 1778.

5 Jan 1779:  Congress issued a requisition to the states for SM$15,000,000 for 1779.  Congress passed additional resolutions urging the states to pay it on 7 Oct 1779 and 18 Mar 1780.

19 May 1779:  Congress requisitioned $45,000,000 from the states.

None of the above requisitions were ever paid.  In fairness to the states, Congress was not acting under any constitutional authority, only as an emergency institution.

But the requisition system under the Articles, in which the states were obligated by the compact, did not fare much better:

30 Oct 1781:  Congress issued its first requisition to the states under the Articles of Confederation for SM$8,000,000.

4 Sep 1782:  Congress requisitioned SM$1,200,000 from the states, but did not require it be paid directly to Congress.  The states were to use the revenue to pay down interest in their own states.

16 Oct 1782:  Congress requisitioned another SM$2,000,000 from the states.

18 Apr 1783:  A standing annual requisition of SM$1,500,000 was requested as part of resolution to give Congress the power to levy import duties.

27 Apr 1784:  Of the $SM8,000,000 requisitioned on 30 Oct 1781, SM$1,436,511 had been received from the states.  The states were credited with having paid the SM$1,200,000 requisitioned on 4 Sep 1782 as it was for local interest payments.  Of the requisition of 16 Oct 1782 for SM$2,000,000, none had been paid.  The request for the standing requisition of 18 Apr 1783 had been ignored.  Congress decided to lower its expectations down to half of the original requisition of SM$8,000,000, subtracted the amount paid, and accordingly requisitioned SM$2,670,988 for 1784.  This amount would meet the immediate minimal needs of the government.

27 Sep 1785:  Congress requisitioned SM$3,000,000 from the states.

31 Dec 1785:  Of the original SM$8,000,000 requisition of 30 Oct 1781, about SM$1,600,000 had been paid by the states.

15 Feb 1786:  The total receipts since 1781 amounted to SM$2,457,987: a) from requisitions made between 1 Nov 1781 and 1 Nov 1784, SM$2,025,089; b) from requisitions made between 1 Nov 1784 and 1 Jan 1786, SM$432,898.

31 Dec 1786:  Congress had received only SM$500,000 of the money requisitioned from the states over the past two years.

In summary, ignoring the standing requisition of 18 Apr 1783 and the requisition of 4 Sep 1782, Congress had requisitioned $SM13,000,000 from the states, but had received about $SM2,525,000, which is a little less than 20%.   This was clearly not a workable system; Congress could not meet its basic obligations (including paying the men in the army).  Congress survived on borrowed money, usually at very high interest rates, because its credit and means were so bad.

During the debate leading up to the 15 Feb 1786 requisition, Congress issued a report by a committee consisting of Pinckney, King, Kean, Monroe, and Pettit, declaring that the Articles of Confederation were inadequate.  It laid out several conclusions, two of which were: a) the requisition system of raising revenues had been a failure for its entire eight year duration; and b) the requisition system could not be relied upon in the future.

There were some proposals to alter the Articles to give Congress an independent revenue source by granting it a power to levy duties on imports.  Twelve of the states agreed to it, but New York refused on the grounds that a general import duty levied by Congress would serve to weaken New York’s position as a trade center.  The persistent financial crisis and New York’s intransigence, coupled with Shays’ Rebellion, led to the calling of the Constitutional Convention in 1787.

James Madison wrote an undated paper near the end of his life in which he recounted this period as Congress and the nation as a whole suffered under this defect [1]:

“But the radical infirmity of the “Articles of Confederation” was the dependence of Congress on the voluntary and simultaneous compliance with its requisitions by so many independent communities, each consulting more or less its particular interests and convenience, and distrusting the compliance of the others.”

This problem was resolved by the adoption of the U. S. Constitution, in which Congress was given power to raise revenue independent of state influence:

[Article 1] Section 8.  Congress shall have the power to lay and collect taxes, duties, imposts, and excises to pay the debts and provide for the common defense and general welfare of theUnited States; but all duties, imposts, and excises shall be uniform throughout theUnited States.

[1]   Jonathan Elliot, Debates on the Adoption of the Federal Constitution in the Convention Held at Philadelphia in 1787, With a Diary of the Debates of the Congress of the Confederation; As Reported by James Madison, Philadelphia: J. B. Lippincott & Co., 1881, Vol. 5, p. 112

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