The Life of George Washington, Vol. 4 (of 5)
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NOTE--No. IV. _See Page 370._
In the formation of this treaty, a question came on to be considered
and decided which involved a principle that on an after occasion, and
in a different case, excited a ferment never to be forgotten by those
who took an active part in the politics of the day.
The whole commerce of the Creek nation was in the hands of
M'Gillivray, who received his supplies from a company of British
merchants, free from duty, through the territories belonging to Spain.
This circumstance constituted no inconsiderable impediment to the
progress of the negotiation. M'Gillivray derived emoluments from the
arrangement which he would not consent to relinquish; and was not
without apprehensions, that Spain, disgusted by his new connexions
with the United States, might throw embarrassments in the way of this
profitable traffic. In addition to this consideration, it was, on the
part of the United States, desirable to alter the channel through
which the Indians should receive their supplies, and thereby to render
them more dependent on the American government. But it would be
necessary to exempt the goods designed for the Indian nation from the
duties imposed by law on imported articles, and the propriety of such
an exemption might well be questioned.
With that cautious circumspection which marked his political course,
the president took this point into early consideration, and required
the opinion of his constitutional advisers respecting it. The
secretary of state was of opinion that the stipulation for importing
his goods through the United States, duty free, might safely be made.
"A treaty made by the president with the concurrence of two-thirds of
the senate, was," he said, "a law of the land," and a law of superior
order, because it not only repeals past laws, but can not itself be
repealed by future ones. The treaty then will legally control the duty
act, and the act for licensing traders in this particular instance.
From this opinion there is no reason to suppose that any member of the
cabinet dissented. A secret article providing for the case was
submitted to the senate, and it has never been understood that in
advising and consenting to it, that body was divided.
* * * * *
NOTE--No. V. _See Page 394._
This question was investigated with great labour, and being one
involving principles of the utmost importance to the United States, on
which the parties were divided, the subject was presented in all the
views of which it was susceptible. A perusal of the arguments used on
the occasion would certainly afford much gratification to the curious,
and their insertion at full length would perhaps be excused by those
who recollect the interest which at the time was taken in the measure
to which they related, and the use which was made of it by the
opponents of the then administration; but the limits prescribed for
this work will not permit the introduction of such voluminous papers.
It may, however, be expected that the outline of that train of
reasoning with which each opinion was supported, and on which the
judgment of the president was most probably formed, should be briefly
stated.
To prove that the measure was not sanctioned by the constitution, the
general principle was asserted, that the foundation of that instrument
was laid on this ground, "that all powers not delegated to the United
States by the constitution, nor prohibited by it to the states, are
reserved to the states or to the people." To take a single step beyond
the boundaries thus specially drawn around the powers of congress, is
to take possession of a boundless field of power, no longer
susceptible of definition.
The power in question was said not to be among those which were
specially enumerated, nor to be included within either of the general
phrases which are to be found in the constitution.
The article which contains this enumeration was reviewed; each
specified power was analyzed; and the creation of a corporate body was
declared to be distinct from either of them.
The general phrases are,
1st. To lay taxes to provide for the general welfare of the United
States. The power here conveyed, it was observed, was "to lay taxes,"
the purpose was "the general welfare." Congress could not lay taxes
_ad libitum_, but could only lay them for the general welfare; nor did
this clause authorize that body to provide for the general welfare
otherwise than by laying taxes for that purpose.
2dly. To make all laws which shall be necessary and proper for
carrying into execution the enumerated powers.
But they can all be carried into execution without a bank. A bank,
therefore, is not necessary, and consequently not authorized by this
phrase.
It had been much urged that a bank would give great facility or
convenience in the collection of taxes. Suppose this were true; yet
the constitution allows only the means which are necessary, not those
which are convenient. If such a latitude of construction be allowed
this phrase, as to give any non-enumerated power, it will go to every
one; for there is no one which ingenuity may not torture into a
_convenience, in some way or other, to some one_ of so long a list of
enumerated powers. It would swallow up all the list of enumerated
powers, and reduce the whole to one phrase. Therefore it was that the
constitution restrained them to _necessary_ means, that is to say, to
those means without which the grant of the power must be nugatory.
The convenience was then examined. This had been stated in the report
of the secretary of the treasury to congress, to consist in the
augmentation of the circulation medium, and in preventing the
transportation and retransportation of money between the states and
the treasury.
The first was considered as a demerit. The second, it was said, might
be effected by other means. Bills of exchange and treasury drafts
would supply the place of bank notes. Perhaps indeed bank bills would
be a more convenient vehicle than treasury orders; but a little
difference in the degree of convenience can not constitute the
_necessity_ which the constitution makes the ground for assuming any
non-enumerated power.
Besides, the existing state banks would, without doubt, enter into
arrangements for lending their agency. This expedient alone suffices
to prevent the existence of that _necessity_ which may justify the
assumption of a non-enumerated power as a means for carrying into
effect an enumerated one.
It may be said that a bank whose bills would have a currency all over
the states, would be more convenient than one whose currency is
limited to a single state. So it would be still more convenient that
there should be a bank whose bills should have a currency all over the
world; but it does not follow from this superior conveniency, that
there exists any where a power to establish such a bank, or that the
world may not go on very well without it.
For a shade or two of convenience, more or less, it can not be
imagined that the constitution intended to invest congress with a
power so important as that of erecting a corporation.
In supporting the constitutionality of the act, it was laid down as a
general proposition, "that every power vested in a government is in
its nature _sovereign_," and includes by _force_ of the _term_, a
right to employ all the _means_ requisite and _fairly applicable to_
the attainment of the _ends_ of such power; and which are not
precluded by restrictions and exceptions specified in the
constitution, are not immoral, are not contrary to the essential ends
of political society.
This principle, in its application to government in general, would be
admitted as an axiom; and it would be incumbent on those who might
refuse to acknowledge its influence in American affairs to _prove_ a
distinction; and to show that a rule which, in the general system of
things, is essential to the preservation of the social order, is
inapplicable to the United States.
The circumstance that the powers of sovereignty are divided between
the national and state governments, does not afford the distinction
required. It does not follow from this, that each of the portions of
power delegated to the one or to the other, is not sovereign with
regard to its _proper objects_. It will only follow from it, that each
has sovereign power as to certain things, and not as to other things.
If the government of the United States does not possess sovereign
power as to its declared purposes and trusts, because its power does
not extend to all cases, neither would the several states possess
sovereign power in any case; for their powers do not extend to every
case. According to the opinion intended to be combated, the United
States would furnish the singular spectacle of _a political society_
without _sovereignty_, or a people _governed_ without a _government_.
If it could be necessary to bring proof of a proposition so clear as
that which affirms that the powers of the federal government, _as to
its objects_, were sovereign, there is a clause in the constitution
which is decisive. It is that which declares the constitution of the
United States, the laws made in pursuance of it, and the treaties made
under its authority to be the supreme law of the land. The power which
can create the supreme law in any case, is doubtless sovereign as to
such case.
This general and indisputable principle puts an end to the abstract
question, whether the United States have power to erect a corporation:
for it is unquestionably incident to sovereign power to erect
corporations, and consequently to that of the United States, in
relation to the objects intrusted to the management of the government.
The difference is this: where the authority of the government is
general, it can create corporations _in all cases_; where it is
confined to certain branches of legislation, it can create
corporations only _in those cases_.
That the government of the United States can exercise only those
powers which are delegated by the constitution, is a proposition not
to be controverted; neither is it to be denied on the other hand, that
there are implied as well as express powers, and that the former are
as effectually delegated as the latter. For the sake of accuracy it
may be observed, that there are also _resulting_ powers. It will not
be doubted that if the United States should make a conquest of any of
the territories of its neighbours, they would possess sovereign
jurisdiction over the conquered territory. This would rather be a
result of the whole mass of the powers of the government, and from the
nature of political society, than a consequence of either of the
powers specially enumerated. This is an extensive case in which the
power of erecting corporations is either implied in, or would result
from some or all of the powers vested in the national government.
Since it must be conceded that implied powers are as completely
delegated as those which are expressed, it follows that, as a power of
erecting a corporation may as well be implied as any other thing, it
may as well be employed as an _instrument_ or _mean_ of carrying into
execution any of the specified powers as any other _instrument_ or
_mean_ whatever. The question in this as in every other case must be,
whether the mean to be employed has a natural relation to any of the
acknowledged objects or lawful ends of the government. Thus a
corporation may not be created by congress for superintending the
police of the city of Philadelphia, because they are not authorized to
regulate the police of that city; but one may be created in relation
to the collection of the taxes, or to the trade with foreign
countries, or between the states, or with the Indian tribes, because
it is in the province of the federal government to regulate those
objects; and because it is incident to a general sovereign or
legislative power to regulate a thing, to employ all the means which
relate to its regulation, to the best and greatest advantage.
A strange fallacy seems to have crept into the manner of thinking and
reasoning upon this subject. The imagination has presented an
incorporation as some great, _independent, substantive_ thing--as a
political end of peculiar magnitude and moment; whereas it is truly to
be considered as a quality, capacity, or mean to an end. Thus a
mercantile company is formed with a certain capital for the purpose of
carrying on a particular branch of business. The business to be
prosecuted is the _end_. The association in order to form the
requisite capital is the primary _mean_. Let an incorporation be
added, and you only add a new quality to that association which
enables it to prosecute the business with more safety and convenience.
The association when incorporated still remains the _mean_, and can
not become the _end_.
To this reasoning respecting the inherent right of government to
employ all the means requisite to the execution of its specified
powers, it is objected, that none but _necessary_ and _proper_ means
can be employed; and none can be _necessary_, but those without which
the grant of the power would be nugatory. So far has this restrictive
interpretation been pressed as to make the case of _necessity_ which
shall warrant the constitutional exercise of a power, to depend on
casual and temporary circumstances; an idea, which alone confutes the
construction. The expedience of exercising a particular power, at a
particular time, must indeed depend on circumstances, but the
constitutional right of exercising it must be uniform and invariable.
All the arguments, therefore, drawn from the accidental existence of
certain state banks which happen to exist to-day, and for aught that
concerns the government of the United States may disappear to-morrow,
must not only be rejected as fallacious, but must be viewed as
demonstrative that there is a radical source of error in the
reasoning.
But it is essential to the being of the government that so erroneous a
conception of the meaning of the word _necessary_ should be exploded.
It is certain that neither the grammatical nor popular sense of the
term requires that construction. According to both, _necessary_ often
means no more than _needful, requisite, incidental, useful_, or
_conducive to_. It is a common mode of expression to say that it is
necessary for a government or a person to do this or that thing, where
nothing more is intended or understood than that the interests of the
government or person require, or will be promoted by doing this or
that thing.
This is the true sense in which the word is used in the constitution.
The whole turn of the clause containing it indicates an intent to give
by it a liberal latitude to the exercise of the specified powers. The
expressions have peculiar comprehensiveness. They are "to make _all
laws_ necessary and proper for carrying into execution the foregoing
powers, and _all other_ powers vested by the constitution in the
government of the United States, or in any _department_ or _office_
thereof." To give the word "necessary" the restrictive operation
contended for, would not only depart from its obvious and popular
sense, but would give it the same force as if the word _absolutely_ or
_indispensably_ had been prefixed to it.
Such a construction would beget endless uncertainty and embarrassment.
The cases must be palpable and extreme in which it could be pronounced
with certainty that a measure was absolutely necessary, or one without
which a given power would be nugatory. There are few measures of any
government which would stand so severe a test. To insist upon it would
be to make the criterion of the exercise of an implied power _a case
of extreme necessity_; which is rather a rule to justify the
overleaping the bounds of constitutional authority than to govern the
ordinary exercise of it.
The degree in which a measure is necessary can never be a test of the
legal right to adopt it. The relation between the _measure_ and the
_end_; between the nature of the _mean_ employed towards the execution
of a power, and the object of that power must be the criterion of
constitutionality, not the more or less _necessity_ or _utility_.
The means by which national exigencies are to be provided for,
national inconveniences obviated, and national prosperity promoted,
are of such infinite variety, extent, and complexity, that here must
of necessity be great latitude of discretion in the selection and
application of those means. Hence the necessity and propriety of
exercising the authority intrusted to a government on principles of
liberal construction.
While on the one hand, the restrictive interpretation of the word
_necessary_ is deemed inadmissible, it will not be contended on the
other, that the clause in question gives any new and independent
power. But it gives an explicit sanction to the doctrine of implied
powers, and is equivalent to an admission of the proposition that the
government, _as to its specified powers and objects_, has plenary and
sovereign authority.
It is true that the power to create corporations is not granted in
terms. Neither is the power to pass any particular law, nor to employ
any of the means by which the ends of the government are to be
attained. It is not expressly given in cases in which its existence is
not controverted. For by the grant of a power to exercise exclusive
legislation in the territory which may be ceded by the states to the
United States, it is admitted to pass; and in the power "to make all
needful rules and regulations respecting the territory or other
property of the United States," it is acknowledged to be implied. In
virtue of this clause, has been implied the right to create a
government; that is, to create a body politic or corporation of the
highest nature; one that, in its maturity, will be able itself to
create other corporations. Thus has the constitution itself refuted
the argument which contends that, had it been designed to grant so
important a power as that of erecting corporations, it would have been
mentioned. But this argument is founded on an exaggerated and
erroneous conception of the nature of the power. It is not of so
transcendent a kind as the reasoning supposes. Viewed in a just light,
it is a _mean_ which ought to have been left to implication, rather
than an _end_ which ought to have been expressly granted.
The power of the government then to create corporations in certain
cases being shown, it remained to inquire into the right to
incorporate a banking company, in order to enable it the more
effectually to accomplish _ends_ which were in themselves lawful.
To establish such a right it would be necessary to show the relation
of such an institution to one or more of the specified powers of
government.
It was then affirmed to have a relation more or less direct to the
power of collecting taxes, to that of borrowing money, to that of
regulating trade between the states, to those of raising, supporting,
and maintaining fleets and armies; and in the last place to that which
authorizes the making of all needful rules and regulations concerning
the property of the United States, as the same had been practised upon
by the government.
The secretary of the treasury next proceeded, by a great variety of
arguments and illustrations, to prove the position that the measure in
question was a proper mean for the execution of the several powers
which were enumerated, and also contended that the right to employ it
resulted from the whole of them taken together. To detail those
arguments would occupy too much space, and is the less necessary,
because their correctness obviously depends on the correctness of the
principles which have been already stated.
* * * * *
NOTE--No. VI. _See Page 434._
The officer to whom the management of the finances was confided was so
repeatedly charged with a desire to increase the public debt and to
render it perpetual, and this charge had such important influence in
the formation of parties, that an extract from this report can not be
improperly introduced.
After stating the sum to be raised, the secretary says, "three
expedients occur to the option of the government for providing this:
"One, to dispose of the interest to which the United States are
entitled in the bank of the United States. This at the present market
price of bank stock would yield a clear gain to the government much
more than adequate to the sum required.
"Another, to borrow the money upon an establishment of funds either
merely commensurate with the interest to be paid, or affording a
surplus which will discharge the principal by instalments within a
short term.
"The third is to raise the amount by taxes."
After stating his objections to the first and second expedients, the
report proceeds thus, "but the result of mature reflection is, in the
mind of the secretary, a strong conviction that the last of the three
expedients which have been mentioned, is to be preferred to either of
the other two.
"Nothing can more interest the national credit and prosperity than a
constant and systematic attention to husband all the means previously
possessed for extinguishing the present debt, and to avoid, as much as
possible, the incurring of any new debt.
"Necessity alone, therefore, can justify the application of any of the
public property, other than the annual revenues, to the current
service, or the temporary and casual exigencies; or the contracting of
an additional debt by loans, to provide for those exigencies.
"Great emergencies indeed might exist, in which loans would be
indispensable. But the occasions which will justify them must be truly
of that description.
"The present is not of such a nature. The sum to be provided is not of
magnitude enough to furnish the plea of necessity.
"Taxes are never welcome to a community. They seldom fail to excite
uneasy sensations more or less extensive. Hence a too strong
propensity in the governments of nations, to anticipate and mortgage
the resources of posterity, rather than to encounter the
inconveniencies of a present increase of taxes.
"But this policy, when not dictated by very peculiar circumstances, is
of the worst kind. Its obvious tendency is, by enhancing the permanent
burdens of the people, to produce lasting distress, and its natural
issue is in national bankruptcy."
It will be happy if the councils of this country, sanctioned by the
voice of an enlightened community, shall be able to pursue a different
course.
* * * * *
NOTE--No. VII. _See Page 450._
_About the same time a letter was addressed to the attorney
general on the same subject. The following extract is taken
from one of the twenty-sixth of August to the secretary of
the treasury._
"Differences in political opinions are as unavoidable as, to a certain
point, they may be necessary; but it is exceedingly to be regretted
that subjects can not be discussed with temper, on the one hand, or
decisions submitted to on the other, without improperly implicating
the motives which led to them; and this regret borders on chagrin when
we find that men of abilities, zealous patriots, having the same
_general_ objects in view, and the same upright intentions to
prosecute them, will not exercise more charity in deciding on the
opinions and actions of each other. When matters get to such lengths,
the natural inference is that both sides have strained the cords
beyond their bearing, that a middle course would be found the best
until experience shall have decided on the right way; or, which is not
to be expected, because it is denied to mortals, until there shall be
some infallible rule by which to forejudge events.
"Having premised these things, I would fain hope that liberal
allowances will be made for the political opinions of each other; and
instead of those wounding suspicions, and irritating charges with
which some of our gazettes are so strongly impregnated, and which can
not fail, if persevered in, of pushing matters to extremity, and
thereby tearing the machine asunder, that there might be mutual
forbearance and temporising yieldings on _all sides_. Without these, I
do not see how the reins of government are to be managed, or how the
union of the states can be much longer preserved.
"How unfortunate would it be if a fabric so goodly, erected under so
many providential circumstances, after acquiring in its first stages,
so much respectability, should, from diversity of sentiment, or
internal obstructions to some of the acts of government (for I can not
prevail on myself to believe that these measures are as yet the acts
of a determined party) be brought to the verge of dissolution.
Melancholy thought! But while it shows the consequences of diversified
opinions, where pushed with too much tenacity, it exhibits evidence
also of the necessity of accommodation, and of the propriety of
adopting such healing measures as may restore harmony to the
discordant members of the union, and the governing powers of it.