Hamilton and the Left

Peter Howard: We are citizens of an American nation! And our rights are being threatened by a tyrant three thousand miles away!
Benjamin Martin: Would you tell me please, Mr Howard, why should I trade one tyrant three thousand miles away for three thousand tyrants one mile away? An elected legislature can trample a man's rights as easily as a king can.
--The Patriot

Many people scratch their heads over the Left's affinity for Alexander Hamilton. Hamilton was, after all, one of the vocal framers of the Constitution. He also wrote skeptically, in the Federalist Papers and elsewhere, about a euphemism of leftist rule: democracy.

However, once the Constitution was ratified, Hamilton's actions revealed his true nature--much of which leftists would find naturally appealing. He favored a strong central government and thought the Constitution should be bypassed as necessary by the ruling class. In Hamilton's view, that ruling class should be aristocratic nature. He thought the the president should be granted lifetime tenure and that the powers of the executive branch should be disproportionately large.

As first the first treasury secretary, Hamilton initiated the nation's sovereign debt program and liked the idea of acquiring federal resources on the back of taxpayers. He was fond of central banking and got the First Bank of the United States, a predecessor to today's Federal Reserve, off the ground.

In many ways Hamilton's profile resembles Lincoln's--another authoritarian who leftists love to love.

Antecedents of the Civil War Part I

"There's an old Indian saying: Follow the cigar smoke, find the fat man there."
--Brig General John Buford (Gettysburg)

The Constitution was barely dry when some people such as Alexander Hamilton were already trying to exceed its bounds. Hamilton believed that the US would be better off with a strong central government more in line w/ the British design that the US had recently thrown off.

The Federalist Party that harbored Hamilton's platform was already sliding when Hamilton was killed in his famous duel with Aaron Burr in 1804. By 1815ish the Federalist Party was largely history. However, the idea of a dominant central government was not. The baton was passed to the National Republican Party which became the Whig Party which became the Republican Party.

Henry Clay and other future Whig leaders developed what became known as the American System to express the strong central government ideal. The American System stressed protectionist tariffs, central banking, and government funded 'internal improvements' as its primary planks.

The American System is what economists today call a mercantilist policy. Today, particular planks would also fit the label 'corporate welfare.'

Key backers of the American System were Northern businessmen who stood to get rich if this system was implemented. Southern states opposed the American System from the get go, arguing that most of the benefits would not flow in their direction, and that the successes of Northern producers would come out of the hides of Sourthern producers.

In the first half of the 1800s, Washington backers of the American System were able to implement the various planks with mixed success. Internal improvements primarily took the form of government funded transportation projects such as the Erie Canal. America's second attempt at central banking, the Second Bank of the United States, was enacted in 1816 only to be shut down by Andrew Jackson in 1833.

The element of the American System that was operationalized to the fullest degree during the first half of the 19th century was the tariff plank. Beginning in 1816, a series of tariffs were imposed on imported goods. Initially, tariff rates were 20-25% although future tariff acts taxed imports at rates north of 40%.

As with all tariffs, groups protected by the tariffs benefitted. In this case, those groups were the stakeholders of manufacturers primarily located in the Northern states. Losers included all buyers of protected goods, since similar good were available in unhampered markets for a cheaper goods.

The biggest losers were the Southern states. Because the Southern economy was primarily an agrarian one, Southern states needed to trade for manufactured goods. The South's primary trading partners were the North and Europe. The imposition of tariffs raised to cost of trade in the South, and tilted trade away from Europe and toward the North.

It did not take long before Southern states decried federal government policies, particularly with respect to tariffs, as unjust and unconstitutional.

Hamilton's Play

"I've been played like a grand piano by the master, Gekko the Great."
--Bud Fox (Wall Street)

In late July of 1789, the state of New York held its constitutional convention. Ratification by New York was not necessary for the United States to come into being, as the Constitution had already been approved by ten states by the time New York representative met. Only nine 'yes' votes were required.

Instead, the state convention essentially became a referendum on whether New York would join the union.

There was opposition. Drawing from the Antifederalist argument, many worried that the central government would grow too big and powerful, thereby marginalizing state sovereignty.

Nonsense, said one of the greatest proponents of strong central government--New York's own Alexander Hamilton. The co-author of the Federalist Papers addressed the convention:

"Gentlemen indulge too many unreasonable apprehensions of danger to the State governments. They seem to suppose that the moment you put men into a national council, they become corrupt and tyrannical and lose all their affection for their fellow citizens. But can we imagine that the Senators will ever be so insensible of their own advantage as to sacrifice the genuine interest of their constituents?"

The Antifederalists certainly imagined it. And it is difficult to argue with the prescience of their vision.

It is also difficult not to surmise that Hamilton was being at least a tad disingenuous with his esteemed colleagues at the state convention. After all, the ink was barely dry after the state signing before he began arguing that the Constitution contained implied powers that granted the federal government greater authority over the states. Post Constitution, Hamilton became perhaps the most vocal proponent of strong central government.

Did the delegates at the New York ratification convention realize that they were being played?

Impeachment Partisanship

Here comes the rain again
Falling on my head like a memory
Falling on my head like a new emotion
--Eurythmics

Alan Dershowitz discusses the Constitutional basis of impeachment and the debates of our founding ancestors about the issue. To be impeached, a president must commit a crime, and the commission of that crime must also constitute an abuse of office. Abuse of office by itself may be wrong, but it is not an impeachable offense.

The basis for impeachment was debated at the Constitutional Convention. When simply 'maladminstration' was proposed as grounds for impeachment, James Madison objected, arguing that the criterion was so vague and open-ended that the president would serve at the will of Congress and turn the federal government into a parliamentary democracy where the president could be removed with a vote of no confidence.

Instead, the framers adopted strict requirements for impeachment. Bribery, treason, or other high crimes and misdemeanors must be evident. A 2/3 super-majority vote in the Senate is required for removal.

In Federalist 65, Alexander Hamilton wrote of the dangers of a partisan approach to impeachment. Dershowitz suggests that the recent House impeachment circus demonstrates the partisan approach well. He suggests that impeachment partisanship further divides the nation and threatens to weaken the Constitution.

Perhaps, but the framers might also suggest that a partisan approach to impeachment is also likely to boomerang the party that goes on a unilateral witch hunt for all to see.

The Loopholes of Section 8

I got something now to think about
I'll work all day but not to pay it out
Keep on working
Keep on working
--Pete Townshend

If one reads the Constitution of the United States, it's difficult to conclude that this document is the perfect government framework promoted in social studies classrooms and by some policy wonks. Instead, it reads like a document of compromise, and one geared towards consolidating power towards a central authority. Moreover, the document seems structured in a fashion that virtually guaranteed expansion of the State over time.

Parenthetically, a similar view appears to have been held by many, if not the majority, of American citizens at the time of the Constitution's creation and ratification in the 1787-1789 period (see for example, Cornell 1999; Storing 1981).

No portion of the Constitution reflects the expansionist tone better than Article 1, Section 8. This section, which specifies the powers of Congress, includes a number of open ended clauses which over the years have served as 'loopholes' for the US government to justify more power and authority over the people. Three clauses stick out in particular:

General Welfare clause. "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare [emphasis mine] of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States." New Deal and other social programs have been justified by evoking the General Welfare clause.

Commerce clause. "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." From this clause sprang myriad government regulatory bodies and commissions that rendered US markets 'unfree' soon after the Constitution's ratification.

Necessary And Proper clause. "To make all laws which shall be necessary and proper [emphasis mine] for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof." This is the final clause of Section 8, and reads like a catch-all for anything that Congress might do that is not specified elsewhere in the document. The open-ended nature of this clause has made it a favorite citation of bureaucrats when justifying increases in government scope.

Early Federalists, such as Alexander Hamilton, understood the utility of these loopholes in promoting Statist agendas.

There are those who claim that government size has grown because we have strayed away from the Constitution as written. I submit that the opposite may be true--that largely by following the Constitution and exploiting its specified loopholes, we were bound to assemble the governmental Leviathan that we currently face.

References

Cornell, S. 1999. The other founders. Chapel Hill, NC: University of North Carolina Press.

Storing, H.J. (1981). What the Anti-Federalists were for. Chicago: University of Chicago Press.

Implied Power

Drawn into the stream of undefined illusion
Those diamond dreams, they can't disguise the truth
--Level 42

In his monologue, Judge Nap notes that almost as soon as the Constitution was ratified, big government proponents such as Alexander Hamilton began suggesting that the federal government had 'implied powers'--powers that were not written in the Constitution yet somehow there.

It is upon the agument of 'implied power' that snippets of language from the Constitution, such as the 'clauses' of Article 1 Section 8 (e.g., the Commerce clause, the General Welfare clause), have been evoked by lawmakers and judges to justify the expansion of federal government scope.

Such a justification could make sense only to people with no reasoning power whatsoever (or, of course, to those who stand to benefit from more government power).

The Constitutional Convention lasted four months, during which time the framers debated and carefully specified the limitations to central government power. The subsequent ratification process took close to another debate-filled year.

It is likely that the Constitution would not have been ratified if there was not an agreement to amend the Constitution with even more specification of individual rights and the limits of government power. The last of these ten amendments states that powers not delegated to the federal government by the Constitution go to the individual states and their people.

How could a process that meticulously focused on limiting central government power produce a framework that can legitimately be interpreted as being open ended--granting government powers that heretofore had been unspecified? Stated differently, why would those involved in the Constitutional development and ratification process waste their time? Why debate and limit if the intent was to subsequently permit arbitrary expansion of power?

It makes no sense, of course. The Constitution was written and ratified because the people wanted hard restrictions on central government power.

Once this situation is thought thru, only those who reap windfalls from increased government power will be prone to conclude that 'implied powers' are valid.

Whiskey Rebellion

"How could it come to this? An army of rabble...peasants. Everything will change. Everything has changed."
--General Charles Cornwallis (The Patriot)

Rothbard discusses one of the many American events that has been distorted by historians: the Whiskey Rebellion. The official narrative is that people in four western Pennsylvania counties refused to pay an excise tax on whiskey that had been levied by the workings of Alexander Hamilton, then Secretary of State, in 1791. Subsequent uprisings drove President Washington to call a federal army of 13,000 into the area to put down the insurrection in 1794.

Consequently, according to the narrative, a local but dramatic challenge to federal taxing power had been defeated, and the forces of federal law and order were reinforced.

Rothbard points out the flaws with the official narrative. The deep seated hatred that Americans had for internal taxes of any kind found widespread resistance to the whiskey tax far beyond a mere four Pennsylvania counties. In frontier areas of several states, no one paid the tax on the whiskey.

Moreover, whiskey was widely produced by back-country farmers and often used as a medium of exchange in local transactions. Back-country people people correctly viewed the tax as a means for large distilleries to cripple their smaller and more numerous competitors.

Western Pennsylvania, Rothbard observed, "was only the tip of the iceberg." It became the focus in large part because it was one of the few back-country areas that made any attempt to collect the whiskey tax. Other areas did not rebel because the taxes were not being collected.

Widespread resistance to the tax ultimately helped motivate formation of the Democrat-Republican party and the forthcoming Jeffersonian movement. In fact, one of Jefferson's first acts as president was to repeal the entire federal excise tax program.

The true story of the Whiskey Rebellion is that it was a widespread, multi-year campaign of civil disobedience in which American citizens refused to pay a hated tax. Rather than being quickly put down, the Whiskey Rebellion was successful in that it eventually led to federal repeal of the tax.

It is easy to see why the story was subsequently distorted. Washington and his cabinet did not want to advertise the extent of their failure. And big government historians certainly did want it known that federal taxing power could be successfully challenged by the people.

When correctly viewed, the Whiskey Rebellion was a victory for liberty rather than for the state. It offers a source of inspiration and hope for American taxpayers who ponder being tax resisters.

Reason Without a Face

I make my living off the evening news
Just give me something, something I can use
People love it when you lose, give me dirty laundry
--Don Henley

After the Constitution was drafted in 1787, it circulated among the states for debate. While much of the debate was informal and took place over dinner tables, taverns, town halls, etc, there was also a more formal stream of written discourse that found its way into newspapers, pamphlets, and billings.

The primary issue concerned the proper size of the central government that would oversee the federation of states. The arguments fell into two general camps. The Federalists, today commonly associated with James Madison and Alexander Hamilton, argued for the central government as specified by the Constitution. The writings of this groups are well captured in the body of work known today as the Federalist Papers.

The other camp, known today as the Anti-Federalists, was a less organized group that included Patrick Henry and George Mason. The Anti-Federalists thought that the central government specified by the Constitution was too powerful, and they argued for designs more likely to limit that power. Because Anti-Federalist writings were not published by a central authority, they have been harder to capture, although various collections of Anti-Federalist Papers are available (here's but one list).

An interesting characteristic of this discourse is that most of the Federalist and Anti-Federalist papers were written anonomously, with authors commonly assuming pseudonyms that evoked patriotic or classical imagery. Works were signed by the likes of Publius, Sentinel, Federal Farmer, Brutus, and A Plebian.

A primary reason for anonymity was that people believed that the debate would be more lucid if the ideas were not associated with personalities. A letter might hold more influence if it was signed by Thomas Jefferson than by Agrippa or Cato, even if the contents were not well thought out. If authors used their real names, then readers may have been distracted by what they knew or didn't know about the author--rather than focusing attention on the ideas conveyed in the papers.

It is hard not to wonder how today's political debates would differ if we were to follow similar customs of anonymity. If people today could no longer level criticism on the people behind the ideas, and had to critically analyze the ideas themselves, then my sense is that many of these 'policital thinkers' would be totally lost.

Capacity for reason in the political domain is so under-developed that I doubt many could do much more than speculate about who the faces were behind anonymous missives. Like robots, these critics would launch their tired, programattic personal attacks on imaginary strawmen.

Many people seem to believe that the Constitution has been rendered largely irrelevant by today's world--that humanity has advanced beyond the Framers' capacity to design a governmental system that anticipates modern problems and change.

Those who bother to read discourse penned during the country's formative years know otherwise. Writings of the Federalists and Anti-Federalists indicate a degree of thought process that puts today's political discussions to shame. 

The American System

Col Robert Gould Shaw: What are you doing?
Col Montgomery: Liberating this town in the name of the republic.
--Glory

Henry Clay (Whig, KY) entered national politics in 1811 as a member of Congress. Clay was a political heir to Alexander Hamilton's vision of strong centralized government, a vision that planked the Whig Party platform.

Clay was a central formulator of what came to be known as the 'American System.' The American System consisted of three key elements. High tariffs shielded certain domestic industries from foreign competition. A national banking system gave government control of the money supply. Finally, the road to commerce was paved on government funded programs known as 'internal improvements.'

Modern economists would label the American System as a program of mercantilism. Mercantilism is a conduit for building imperial State power through practices of protectionism and subsidies for favored industries.

Moreover, tax funded subsidies to businesses for government sponsored 'internal improvement' projects are today seen as 'corporate welfare.'

In the first half of the 1800s, Whig politicians were able to put in motion various elements of the American System. For instance, a series of high tariffs protected Northern manufacturers from foreign competition. By the 1840s, the majority of US exports came from the South. Because the South's economy was predominantly grounded in agriculture, those high tariffs meant that Southerners paid more for manufactured goods--whether they came from Europe or the United States.

By the 1820s Southern states condemned the tariffs and other elements of the American System as unconstitutional tools of plunder. The costs of government policies were largely being levied on the South, while those in the North enjoyed an outsized chunk of the spoils.

Parenthetically, South Carolina was close to secession in the 1830s and had voted to nullify (read: refused to collect) a federally improsed tariff before the federal government relectantly backed down.

The American System was a strong centralized government design--one that did not align well with the limited government Constitutional design.

The influence of the American System in driving the South toward secession after Lincoln's election in 1860 cannot be underestimated.

btw, can you name the young Whig politician from Illinois who was a devout proponent of Henry Clay and the American system from the get go?