Volume 9, Issue 2: Hisoria
Jefferson Told Us So
I consider the foundation of the Constitution as 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" (XIIth amendment).[*] 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 any definition.
Thomas Jefferson to President Washington, 1791
On 15 February, 1791, Secretary of State Thomas Jefferson offered what may be the soundest advice a cabinet member ever gave a President. Unfortunately, President George Washington did not heed. We today who marvel that our Constitution is given lip-service but is not followed, must know that our present situation did not spring out of nowhere. If present conditions are disagreeable, wisdom calls us to revive old questions and examine where we made a wrong turn. An important case in point is Jefferson's unheeded advice to Washington in 1791. The brilliant Jefferson, who would later become our country's only philosopher-President, was a rare intellect who could prophetically foresee the far-reaching consequences of a bad argument.
In late 1790, Treasury Secretary Alexander Hamilton proposed a bill to Congress that would charter the first Bank of the United States. Congress passed the bill in early February, 1791. President Washington, before deciding to sign or veto the bill, requested written opinions from his cabinet. Both Jefferson and Attorney General Edmund Randolph argued that Congress lacked the power to create a corporation--much less a bank--and urged the President to veto the bill. He advised Washington that if we construe the Constitution as permitting implied powers to Congress (as Hamilton had argued), Congress will "take possession of a boundless field of power." History has proven him right.
The powers of Congress are specifically enumerated in Article 1, Section 8 of the U.S. Constitution. Hamilton argued that Congress was "sovereign" with respect to these powers, and that "the right of erecting corporations is one inherent in, and inseparable from, the idea of sovereign power." Thus, the power of creating a bank is an "incidental and auxiliary one and was therefore more properly left to implication than expressly granted." This is the doctrine of implied powers, the view that Congress has powers not expressly granted to it in the Constitution. Congress may do whatever relates to the powers expressly granted it. In case the President was worried about Jefferson's warnings about implied powers, Hamilton assured him, "the principle in question does not extend the power of the government beyond prescribed limits."
After Hamilton laid down the doctrine of implied powers, he only needed to show that the proposed Bank had "a relation, more or less direct" to Congress's enumerated powers. So he argued that the proposed Bank related to the power to borrow money because it would give Congress an institution from which to borrow. The Bank related to the power to regulate interstate commerce because it would help create "a convenient medium of exchange between them." Finally, the Constitution gives Congress the power to do whatever is "necessary and proper" for carrying out its enumerated powers. Hamilton argued that necessary "means no more than needful, requisite, incidental, useful, or conducive to." Thus, whatever would be simply useful to Congress for carrying out its powers, even implied powers, is lawful. Washington bought it. Jefferson smelled a rat.
Jefferson's answer called for a return to the Constitution. The Constitution empowers Congress to borrow money. "But this bill neither borrows money nor ensures the borrowing it," for the banker would be as free as any other to lend or not to lend money to the U.S. Treasury. Congress may regulate interstate commerce. But "to erect a bank, and to regulate commerce, are very different acts. He who erects a bank, creates a subject of commerce in its bills" but does not regulate commerce thereby. "To make a thing which may be bought and sold, is not to prescribe regulations for buying and selling." As to "necessary and proper," Jefferson contended that the phrase "was intended to lace them up straitly within the enumerated powers." He continues,
the Constitution allows only the means which are "necessary," not those which are merely "convenient" for effecting the enumerated powers. If such a latitude of construction be allowed to this phrase as to give any non-enumerated power, it will go to every one, for there is not one which ingenuity may not torture into a convenience in some instance or other, to some one of so long a list of enumerated powers.
Read Article 1, Section 8 of the U.S. Constitution. Do we have a strait-laced Congress today? Or has Congress taken "possession of a boundless field of power, no longer susceptible of any definition"? It all started with a bank, and a little dishonesty.