Last month marked the 225th anniversary of our nation’s first major clash over the meaning of the Constitution: the epic argument in 1791 between Alexander Hamilton and Thomas Jefferson over the constitutionality of the national bank. Such an anniversary does not at first present itself to us as a proper object of commemoration. We are understandably more inclined to celebrate the anniversaries of our pivotal moments of political agreement, such as the issuing of the Declaration of Independence or the ratification of the Constitution.
Nevertheless, we can also learn something important about our Constitution and our political way of life from our deep disagreements—especially if those disagreements are prosecuted with the zeal and intelligence with which Hamilton and Jefferson argued over the bank bill. In 1791 this constitutional clash of titans could not be instructive to the American public because it took place not in the newspapers but in the secrecy of George Washington’s cabinet. Later generations, however, have access to the relevant documents and can find in them an education in the virtues of mind and character necessary to the preservation of constitutional government.
When Hamilton joined Washington’s administration as secretary of the treasury, he was confronted with a task of massive importance: restoring the nation’s finances and economy, which were burdened by the new government’s large war debts. The first step in Hamilton’s plan of recovery, his bill for restructuring and funding the debt, had passed Congress only after much bitter debate, with controversy stirred especially by Hamilton’s move to have the federal government assume or take responsibility for the war debts of the states. In contrast, both houses of Congress had enacted his second step, the national bank, with comparative ease. After this initial victory, however, the bank bill encountered an unexpected obstacle: the possible veto of President George Washington.
Troubled by constitutional opposition from James Madison, then serving in the House of Representatives, George Washington was uncertain whether he should sign the bill into law or veto it. Thus he sought the advice of his cabinet on the question of the bill’s constitutionality. Jefferson joined Madison in opposing the bank, submitting his constitutional objections to the president in writing on February 15. Hamilton read Jefferson’s opinion and followed with his rejoinder shortly thereafter.
The “Necessary and Proper” Clause
Their dispute turned primarily on the meaning of the Necessary and Proper Clause. The Constitution certainly does not authorize the creation of a bank in express terms. Such a measure could only be justified as an exercise of an implied power of the federal government. The source of such powers flows from that provision of the Constitution that follows the main enumeration of federal powers and authorizes Congress to “make all laws which shall be necessary and proper 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.”
According to Jefferson, this language could not justify a national bank because the bank was not really necessary to executing any of the government’s enumerated powers. A bank might be a useful or convenient tool for executing, say, the government’s taxing, spending, and borrowing powers. It was not, however, necessary in the sense of being indispensable.
This, Jefferson argued, was the true interpretation of the term “necessary” in the Necessary and Proper Clause: It only authorized those measures without which the federal government’s enumerated powers would be “nugatory,” or without which they would amount to nothing. Jefferson, moreover, contended that any broader interpretation, such as could justify the bank, would be not only wrong but also dangerous, insofar as it would open the door to unlimited government and thus render the Constitution a dead letter.
Hamilton, in response, contended that “necessary” should not be interpreted as narrowly as Jefferson insisted. In common use, he observed, the word often means only what is “useful” or conducive to the achievement of a given end. This more relaxed approach meant the bank was certainly constitutional, since it would indisputably aid the government in the exercise of its fiscal powers.
Like Jefferson, Hamilton pressed the argument to considerations of fundamental importance. Turning the argument around on his critic, Hamilton contended that Jefferson’s interpretation of the federal government’s powers was dangerously narrow. If Jefferson held that Hamilton’s approach to the Constitution would lead to unlimited government, Hamilton contended that Jefferson’s would lead to ineffective government—government that would be reduced to the “imbecility” of the government of the Articles of Confederation, incapable of securing the common good and protecting the people’s rights.
The Demands of Constitutional Fidelity
The immediate political and policy upshot of this debate was that Hamilton prevailed. President Washington was persuaded of the bank’s constitutionality, and he signed the bill into law (although the power of the United States to charter a bank continued to be a matter of constitutional controversy well into the nineteenth century). This fact, however, does not even begin to reveal the lasting significance of this early debate. We should remember this first clash between Hamilton and Jefferson (there were more to come) not so much because it gave us our first national bank as because it gives us a valuable lesson in the demands of constitutional fidelity.
We can learn from this debate, first, the serious intellectual demands of constitutional fidelity. Remaining faithful to the Constitution, and thus to our founding principle of the rule of law, requires not only good intentions but also the ability to think rigorously and at length about the Constitution’s meaning. Hamilton and Jefferson each thought that the other was clearly wrong. Neither, however, thought he could sufficiently prove his case to the impartial observer—in this case, President Washington—by a peremptory invocation of the words of the text. Instead, both showed their awareness that doing justice to the question would require them to consider not only the language of the Necessary and Proper Clause, but also the way it had been understood at the time of ratification, the interpretation the government had placed on it in earlier exercises of its power, its place in the Constitution’s overall structure, and its relationship to the Constitution’s ultimate aims.
We are, moreover, compelled by the case of the bank-bill dispute not only to admire Hamilton and Jefferson’s sophistication of argument but also to imitate it. After all, we learn from this early dispute that constitutional fidelity—so essential to our way of life—cannot in all cases take the simple form of finding out what the founders believed about a constitutional question and then adhering to that view. It turns out that two of the greatest founders—and, we might add, their numerous followers in the country at large—disagreed seriously about the meaning of one of the Constitution’s key provisions, one related to a question of ongoing importance: the scope of the federal government’s powers. If we cannot in every case just get our answers from the founders, then we must seek to rise to their level of argument in seeking answers for ourselves.
Finally, Hamilton and Jefferson’s bank-bill debate teaches us that constitutional fidelity requires virtue not only of mind but also of character. Figuring out how to observe the Constitution in doubtful cases presupposes a will to obey it in all cases. Hamilton and Jefferson, after all, would not have applied their minds so vigorously to the question of the bank’s constitutionality if they had not also assumed that adherence to the Constitution was of fundamental importance. Their arguments, to be sure, were informed by their views of sound public policy and by their larger, and extra-constitutional, visions of the common good.
As is well-known, Hamilton wanted America to become a great commercial power, while Jefferson hoped it would remain a primarily agrarian republic. These visions undoubtedly informed their thinking about the national bank: It was essential to Hamilton’s aspirations and useless or hostile to Jefferson’s. Nevertheless, in this dispute—as in their many others—neither man argued his point merely on grounds of policy and prudence. Both instead demonstrated by their modes of argument their realization that statesmanship in our form of government must be informed by the limits the Constitution imposes.
Washington Invites Argument in Administering Government Powers
Most impressive in this case, perhaps, is the example of constitutional statesmanship George Washington sets. When we consider the bank-bill debate our minds are naturally drawn to the impressive and edifying spectacle of the two great cabinet secretaries producing their competing written opinions, which now rank as among the greatest state papers ever produced in our history. In contrast, Washington wrote next to nothing about the constitutionality of the bank bill.
This view of things tends, understandably but unjustly, to relegate President Washington to a relatively minor role. Washington, after all, had the authority and responsibility to decide whether to sign the bank bill into law. And in preparing himself for the exercise of that responsibility he was the cause of the great debate between Hamilton and Jefferson. He directed them to give their opinions in writing on the question, and this preliminary step was—as much as the decision whether or not to sign the bill—an important and impressive act of constitutional statesmanship.
Washington no doubt agreed with Hamilton on the bank’s usefulness as a tool of government policy. He usually agreed with Hamilton on matters of economic policy. The president had, moreover, ample political and constitutional “cover” just to sign the bill and be done with it. Constitutional objections had been raised in the congressional debates, yet both houses had proceeded to enact the measure relatively quickly and by comfortable margins. Under these circumstances, probably nobody could have accused Washington of shirking his constitutional duty if he had just signed the bill into law. That he did not do so—that he instead sought and even commanded further argument on the question—reveals his deep seriousness about not only administering the government effectively but also scrupulously adhering to the constitutional limits on its powers.
We live in an age of widespread and highly placed disregard for the Constitution. It is an age in which a Speaker of the House, asked about the constitutional basis of major legislation, can answer, “Are you serious?” Such an age would do well to remember the example set by men like Hamilton, Jefferson, and Washington.