II. THE POWERS CONFERRED UPON THE FEDERAL GOVERNMENT
1. The powers for positive action conferred upon the new government were few, but they were adequate to the purposes of the framers. They included, first, the power to lay and collect taxes; but here the rural interests were conciliated by the provision that direct taxes must be apportioned among the states according to population, counting three-fifths of the slaves. This, in the opinion of contemporaries eminently qualified to speak, was designed to prevent the populations of the manufacturing states from shifting the burdens of taxation to the sparsely settled agricultural regions.[[406]]
In a letter to the governor of their state, three delegates from North Carolina, Blount, Spaight, and Williamson, explained the advantage of this safeguard on taxation to the southern planters and farmers: “We had many things to hope from a National Government and the chief thing we had to fear from such a Government was the risque of unequal or heavy Taxation, but we hope you will believe as we do that the Southern states in general and North Carolina in particular are well secured on that head by the proposed system. It is provided in the 9th section of article the first that no Capitation or direct Tax shall be laid except in proportion to the number of inhabitants, in which number five blacks are only counted as three. If a land tax is laid, we are to pay the same rate; for example, fifty citizens of North Carolina can be taxed no more for all their Lands than fifty Citizens in one of the Eastern States. This must be greatly in our favour, for as most of their farms are small and many of them live in Towns we certainly have, one with another, land of twice the value that they possess. When it is also considered that five Negroes are only to be charged the same Poll Tax as three whites, the advantage must be considerably increased under the proposed Form of Government. The Southern states have also a better security for the return of slaves who might endeavour to escape than they had under the original Confederation.”[[407]]
The taxing power was the basis of all other positive powers, and it afforded the revenues that were to discharge the public debt in full. Provision was made for this discharge in Article VI to the effect that “All debts contracted and engagements entered into before the adoption of this Constitution shall be valid against the United States under this Constitution as under the Confederation.”
But the cautious student of public economy, remembering the difficulties which Congress encountered under the Articles of Confederation in its attempts to raise the money to meet the interest on the debt, may ask how the framers of the Constitution could expect to overcome the hostile economic forces which had hitherto blocked the payment of the requisitions. The answer is short. Under the Articles, Congress had no power to lay and collect taxes immediately; it could only make requisitions on the state legislatures. Inasmuch as most of the states relied largely on direct taxes for their revenues, the demands of Congress were keenly felt and stoutly resisted. Under the new system, however, Congress is authorized to lay taxes on its own account, but it is evident that the framers contemplated placing practically all of the national burden on the consumer. The provision requiring the apportionment of direct taxes on a basis of population obviously implied that such taxes were to be viewed as a last resort when indirect taxes failed to provide the required revenue.
With his usual acumen, Hamilton conciliates the freeholders and property owners in general by pointing out that they will not be called upon to support the national government by payments proportioned to their wealth.[[408]] Experience has demonstrated that it is impracticable to raise any considerable sums by direct taxation. Even where the government is strong, as in Great Britain, resort must be had chiefly to indirect taxation. The pockets of the farmers “will reluctantly yield but scanty supplies, in the unwelcome shape of impositions on their houses and lands; and personal property is too precarious and invisible a fund to be laid hold of in any other way than by the imperceptible agency of taxes on consumption.” Real and personal property are thus assured a generous immunity from such burdens as Congress had attempted to impose under the Articles; taxes under the new system will, therefore, be less troublesome than under the old.
2. Congress was given, in the second place, plenary power to raise and support military and naval forces, for the defence of the country against foreign and domestic foes. These forces were to be at the disposal of the President in the execution of national laws; and to guard the states against renewed attempts of “desperate debtors” like Shays, the United States guaranteed to every commonwealth a republican form of government and promised to aid in quelling internal disorder on call of the proper authorities.
The army and navy are considered by the authors of The Federalist as genuine economic instrumentalities. As will be pointed out below, they regarded trade and commerce as the fundamental cause of wars between nations; and the source of domestic insurrection they traced to class conflicts within society. “Nations in general,” says Jay, “will make war whenever they have a prospect of getting anything by it”;[[409]] and it is obvious that the United States dissevered and discordant will be the easy prey to the commercial ambitions of their neighbors and rivals.
The material gains to be made by other nations at the expense of the United States are so apparent that the former cannot restrain themselves from aggression. France and Great Britain feel the pressure of our rivalry in the fisheries; they and other European nations are our competitors in navigation and the carrying trade; our independent voyages to China interfere with the monopolies enjoyed by other countries there; Spain would like to shut the Mississippi against us on one side and Great Britain fain would close the St. Lawrence on the other. The cheapness and excellence of our productions will excite their jealousy, and the enterprise and address of our merchants will not be consistent with the wishes or policy of the sovereigns of Europe. But, adds the commentator, by way of clinching the argument, “if they see that our national government is efficient and well administered, our trade prudently regulated, our militia properly organized and disciplined, our resources and finances discreetly managed, our credit re-established, our people free, contented, and united, they will be much more disposed to cultivate our friendship than provoke our resentment.”[[410]]
All the powers of Europe could not prevail against us. “Under a vigorous national government the natural strength and resources of the country, directed to a common interest, would baffle all the combinations of European jealousy to restrain our growth.... An active commerce, an extensive navigation, and a flourishing marine would then be the offspring of moral and physical necessity. We might defy the little arts of the little politicians to control or vary the irresistible and unchangeable course of nature.”[[411]] In the present state of disunion the profits of trade are snatched from us; our commerce languishes; and poverty threatens to overspread a country which might outrival the world in riches.
The army and navy are to be not only instruments of defence in protecting the United States against the commercial and territorial ambitions of other countries; but they may be used also in forcing open foreign markets. What discriminatory tariffs and navigation laws may not accomplish the sword may achieve. The authors of The Federalist do not contemplate that policy of mild and innocuous isolation which was later made famous by Washington’s farewell address.[[412]] On the contrary—they do not expect the United States to change human nature and make our commercial classes less ambitious than those of other countries to extend their spheres of trade. A strong navy will command the respect of European states. “There can be no doubt that the continuance of the Union under an efficient government would put it within our power, at a period not very distant, to create a navy which, if it could not vie with those of the great maritime powers, would at least be of respectable weight if thrown into the scale of either of two contending parties.... A few ships of the line sent opportunely to the reinforcement of either side, would often be sufficient to decide the fate of a campaign, on the event of which interests of the greatest magnitude were suspended. Our position is, in this respect, a most commanding one. And if to this consideration we add that of the usefulness of supplies from this country, in the prosecution of military operations in the West Indies, it will be readily perceived that a situation so favorable would enable us to bargain with great advantage for commercial privileges. A price would be set not only upon our friendship, but upon our neutrality. By a steady adherence to the Union, we may hope, ere long, to become the arbiter of Europe in America, and to be able to incline the balance of European competitions in this part of the world as our interest may dictate.”[[413]]
As to dangers from class wars within particular states, the authors of The Federalist did not deem it necessary to make extended remarks: the recent events in New England were only too vividly impressed upon the public mind. “The tempestuous situation from which Massachusetts has scarcely emerged,” says Hamilton, “evinces that dangers of this kind are not merely speculative. Who can determine what might have been the issue of her late convulsions, if the malcontents had been headed by a Cæsar or by a Cromwell.”[[414]] The strong arm of the Union must be available in such crises.
In considering the importance of defence against domestic insurrection, the authors of The Federalist do not overlook an appeal to the slave-holders’ instinctive fear of a servile revolt. Naturally, it is Madison whose interest catches this point and drives it home, by appearing to discount it. In dealing with the dangers of insurrection, he says: “I take no notice of an unhappy species of population abounding in some of the states who, during the calm of regular government are sunk below the level of men; but who, in the tempestuous scenes of civil violence, may emerge into human character and give a superiority of strength to any party with which they may associate themselves.”[[415]]
3. In addition to the power to lay and collect taxes and raise and maintain armed forces on land and sea, the Constitution vests in Congress plenary control over foreign and interstate commerce, and thus authorizes it to institute protective and discriminatory laws in favor of American interests,[[416]] and to create a wide sweep for free trade throughout the whole American empire. A single clause thus reflects the strong impulse of economic forces in the towns and young manufacturing centres. In a few simple words the mercantile and manufacturing interests wrote their Zweck im Recht; and they paid for their victory by large concessions to the slave-owning planters of the south.[[417]]
While dealing with commerce in The Federalist[[418]] Hamilton does not neglect the subject of interstate traffic and intercourse. He shows how free trade over a wide range will be to reciprocal advantage, will give great diversity to commercial enterprise, and will render stagnation less liable by offering more distant markets when local demands fall off. “The speculative trader,” he concludes, “will at once perceive the force of these observations and will acknowledge that the aggregate balance of the commerce of the United States would bid fair to be much more favorable than that of the thirteen states without union or with partial unions.”
4. Another great economic antagonism found its expression in the clause conferring upon Congress the power to dispose of the territories and make rules and regulations for their government and admission to the Union. In this contest, the interests of the states which held territories came prominently to the front; and the ambiguity of the language used in the Constitution on this point may be attributed to the inability of the contestants to reach precise conclusions.[[419]] The leaders were willing to risk the proper management of the land problem after the new government was safely launched; and they were correct in their estimate of their future political prowess.
These are the great powers conferred on the new government: taxation, war, commercial control, and disposition of western lands. Through them public creditors may be paid in full, domestic peace maintained, advantages obtained in dealing with foreign nations, manufactures protected, and the development of the territories go forward with full swing. The remaining powers are minor and need not be examined here. What implied powers lay in the minds of the framers likewise need not be inquired into; they have long been the subject of juridical speculation.
None of the powers conferred by the Constitution on Congress permits a direct attack on property. The federal government is given no general authority to define property. It may tax, but indirect taxes must be uniform, and these are to fall upon consumers. Direct taxes may be laid, but resort to this form of taxation is rendered practically impossible, save on extraordinary occasions, by the provision that they must be apportioned according to population—so that numbers cannot transfer the burden to accumulated wealth. The slave trade may be destroyed, it is true, after the lapse of a few years; but slavery as a domestic institution is better safeguarded than before.
Even the destruction of the slave trade had an economic basis, although much was said at the time about the ethics of the clause. In the North where slavery, though widespread, was of little economic consequence, sympathy with the unfortunate negroes could readily prevail. Maryland and Virginia, already overstocked with slaves beyond the limits of land and capital, had prohibited the foreign trade in negroes, because the slave-holders, who predominated in the legislatures, were not willing to see the value of their chattels reduced to a vanishing point by excessive importations. South Carolina and Georgia, where the death rate in the rice swamps and the opening of adjoining territories made a strong demand for the increase of slave property, on the other hand, demanded an open door for slave-dealers.
South Carolina was particularly determined,[[420]] and gave northern representatives to understand that if they wished to secure their commercial privileges, they must make concessions to the slave trade. And they were met half way. Ellsworth said: “As slaves multiply so fast in Virginia and Maryland that it is cheaper to raise than import them, whilst in the sickly rice swamps foreign supplies are necessary, if we go no farther than is urged, we shall be unjust towards South Carolina and Georgia. Let us not intermeddle. As population increases; poor laborers will be so plenty as to render slaves useless.”[[421]]
General Pinckney taunted the Virginia representatives in the Convention, some of whom were against slavery as well as importation, with disingenuous interestedness. “South Carolina and Georgia cannot do without slaves. As to Virginia she will gain by stopping the importations. Her slaves will rise in value and she has more than she wants. It would be unequal to require South Carolina and Georgia to confederate on such unequal terms.”