President George Washington set a precedent of non-intervention in European affairs, a trend that lasted into the 20th century.
In 1793, the French Revolution climaxed with the beheading of King Louis XVI and Marie Antoinette. The revolutionaries then declared war on Great Britain, Spain, and the Netherlands. Most Americans had supported the Revolution, remembering France’s help in securing American independence from Britain. However, the King’s execution disillusioned many American supporters of the revolution, and France’s declaration of war caused even more dismay in the U.S.
Nevertheless, radical Americans cheered the demise of Louis and Marie. Amidst wild celebrations in the East, Boston’s Royal Exchange Alley was renamed Equality Lane, and radical New Yorkers changed King Street to Liberty Street. Such a display of support threatened to embroil the U.S. in the European conflict, and President Washington sought to avoid such involvement.
Edmond-Charles-Edouard Genet, minister of the new French Republic to the U.S., threatened Washington’s effort when he arrived in the U.S. in April 1793. Under the 1778 Treaty of Alliance, the U.S. was obligated to treat France’s enemies as its own, just as France had done during the U.S. War for Independence. Thus, Washington and his cabinet agreed to receive “Citizen Genet” as a diplomat, even though such an action could have prompted France’s enemies to declare war on the U.S.
On the other hand, U.S. officials noted that the 1778 treaty had been between the U.S. and the French monarchy, not the new French Republic, and thus could be legally disregarded. But Washington did not want to go that far because it could have been interpreted as lack of gratitude for France’s contribution to U.S. independence. He and his cabinet continued discussing viable options.
Meanwhile, “Citizen Genet” was warmly welcomed upon landing at Charleston, South Carolina. Instead of immediately traveling to the temporary U.S. capital at Philadelphia to present his diplomatic credentials, Genet instead remained in South Carolina. In a serious breach of diplomatic protocol, Genet effectively went over Washington’s head by commissioning U.S. ships to raid British shipping along the U.S. coast and enlisting Americans to invade Spanish Florida and Louisiana.
Genet’s actions were turning the European conflict into a political crisis in the U.S. Washington finally responded on April 22 by issuing a proclamation that the U.S. would not intervene in the war between the French Republic and its enemies. The word “neutrality” was carefully omitted to avoid offending Britain, whom the U.S. relied on heavily for trade. This allowed the British to continue harassing French shipping bound for U.S. ports.
Washington and his cabinet agreed that this policy best served U.S. interests, as the U.S. could not intervene in Europe and develop its own national economy and interstate relationship under the new Constitution at the same time. Congressman James Madison of Virginia questioned whether Washington had the authority to issue such a proclamation without first obtaining the Senate’s consent.
When Genet finally arrived in Philadelphia after stirring public opinion against France’s enemies, Secretary of State Thomas Jefferson informed him that Washington’s proclamation prohibited U.S. citizens from openly aiding France. Genet met with Washington and urged the president to withdraw his proclamation. Washington refused, and Genet agreed not to commission any more privateers to raid British shipping off U.S. waters.
However, Genet reneged on his pledge and commissioned another raiding vessel. When warned against launching the vessel, Genet threatened to appeal directly to the people for aid. Washington responded by asking France to recall “Citizen Genet” for his breach of protocol and refusal to respect U.S. policy. By this time, the Jacobins had seized power in France, and they threatened to execute Genet if he returned. Genet begged for mercy, and Washington granted him political asylum; Genet became the first foreigner to receive such a distinction in U.S. history.
Jefferson ultimately resigned from Washington’s cabinet because he felt that Washington was more dependent on officials such as Alexander Hamilton regarding foreign affairs. This rift ultimately led to forming the party system in U.S. politics. From a foreign policy perspective, Washington’s proclamation of non-intervention in Europe served as a basis for U.S. policy that future presidents followed until U.S. entry in World War I, 124 years later.
 Schlesinger, Jr., Arthur M., The Almanac of American History (Greenwich, CT: Brompton Books Corporation, 1993), p. 162, 163
 Wallechinsky, David and Wallace, Irving, The People’s Almanac (New York: Doubleday & Co., 1975), p. 144
 Schlesinger, The Almanac of American History, p. 163; White, Howard Ray, Bloodstains, An Epic History of the Politics That Caused the Civil War (Amazon Kindle Edition), Y1789-93 Loc 7735-55
 White, Howard Ray, Bloodstains, Y1789-93 Loc 7735-55
 Schlesinger, The Almanac of American History, p. 163; White, Bloodstains Y1789-93 Loc 7754-63
 Schlesinger, The Almanac of American History, p. 163; Schweikart, Larry and Allen, Michael, A Patriot’s History of the United States (New York: Penguin Books, 2004), p. 141
 Schlesinger, The Almanac of American History, p. 163
 White, Bloodstains, Y1789-93 Loc 7763-72; http://en.wikipedia.org/wiki/Edmond-Charles_Gen%C3%AAt; Schlesinger, The Almanac of American History, p. 163
 Schlesinger, The Almanac of American History, p. 163; Schweikart and Allen, A Patriot’s History of the United States, p. 142; Wallechinsky and Wallace, The People’s Almanac, p. 144
 Wallechinsky and Wallace, The People’s Almanac, p. 144; Schweikart and Allen, A Patriot’s History of the United States, p. 141
Less than 10 years after the founding of the American republic, a series of federal laws threatened the freedoms supposedly guaranteed by the new U.S. Constitution.
In 1798, there were no political parties in the new United States, but federal politicians were splitting into two major factions. The Federalists generally favored a strong central government and a broad interpretation of the Constitution. The Democratic-Republicans generally favored dispersing government strength among the states and a strict interpretation of the Constitution. Federalists controlled both houses of Congress, and Federalist John Adams was president.
The U.S. was experiencing tense diplomatic relations with France, which was seizing U.S. ships on the high seas. President Adams tried diplomacy by dispatching U.S. diplomats to negotiate peace with the French. However, the French agents demanded a bribe before negotiations could begin. This outraged Americans and prompted congressional Federalists to call for war against France. Federalists were also alarmed at the influx of pro-French immigrants that may undermine their policies.
As a result, the Federalist Congress passed a series of laws that became known as the Alien and Sedition Acts. These sought to tighten immigration restrictions and limit government criticism. The acts consisted of four measures:
- The Naturalization Act lengthened the requirement for foreigners to receive citizenship from five to 14 years. This was primarily intended to exclude French and Irish immigrants from voting, most of whom were Catholics and/or Democratic-Republicans.
- The Alien Act and the Alien Enemies Act authorized the president to arrest, imprison, or deport aliens “dangerous to the peace and safety of the United States” during peacetime and wartime respectively. This permitted the Adams administration to deport anyone considered dangerous to national interests. Vice President Thomas Jefferson, a leading Democratic-Republican, believed these laws targeted his political ally, Albert Gallatin, because he had been born in Geneva.
- The Sedition Act prohibited anyone who would “print, utter, or publish… false, scandalous, and malicious writing” about the federal government, president, or Congress.
Democratic-Republicans not only opposed the acts, but they were outraged by the way the laws were enforced. Numerous Democratic-Republican newspaper editors were targeted for suppression, including the grandson of Benjamin Franklin. A man was fined $100 for expressing his wish that the presidential cannon would “hit Adams in the ass.”
Federalist judges used the vaguely worded laws to trump up charges and imprison political dissenters. Democratic-Republican Congressman Matthew Lyon denounced these acts and spat in the eye of a Connecticut Federalist. He was jailed and won reelection while imprisoned. The Alien and Sedition Acts proved to be the first crisis concerning the viability of the constitutional guarantees of free speech, press, association, and assembly.
In addition to charges of unfair treatment, Thomas Jefferson and James Madison argued that the Alien and Sedition Acts were unconstitutional in their Virginia and Kentucky Resolutions. The resolutions noted that the states had not delegated any authority to the federal government to enact legislation that curtailed freedom of expression. Thus, states had the right to nullify these acts.
Jefferson and Madison subscribed to the “compact” theory of government. They argued that states have the right to nullify federal laws deemed unconstitutional because the states had created the federal government and voluntarily agreed to form a compact for their mutual benefit. This was the first doctrine of states’ rights, and it introduced the principle of nullification that would be invoked to challenge federal authority in the future.
Like most federal legislation, the Alien and Sedition Acts produced unintended consequences. First, the laws proved so unpopular that they led to sweeping Democratic-Republican victories in the 1800 elections, including the election of Thomas Jefferson as president. The acts were allowed to expire after Jefferson took office.
Second, the Federalists never fully recovered from Jefferson’s victory in 1800 and the faction eventually dissolved, only to be resurrected as the Whig Party in the 1830s, and again as the Republican Party in the 1850s.
Third and perhaps most importantly, the Virginia and Kentucky Resolutions introduced the concepts of state sovereignty and nullification that would become the primary political issues of the 19th century, ultimately leading to the southern secession and war.
 Woods, Jr., Thomas E., The Politically Incorrect Guide to American History (Washington: Regnery Publishing, 2004), p. 34
 Schweikart, Larry and Allen, Michael, A Patriot’s History of the United States (New York: Penguin Books, 2004); White, Howard Ray, Bloodstains, An Epic History of the Politics That Caused the Civil War (Amazon Kindle edition, 2012)
 Schlesinger, Jr., Arthur M., The Almanac of American History (Greenwich, CT: Brompton Books Corp., 1993), p. 171; White, Howard Ray, Bloodstains, An Epic History of the Politics That Caused the Civil War ; Schweikart, Larry and Allen, Michael, A Patriot’s History of the United States
 Schlesinger, Jr., Arthur M., The Almanac of American History, p. 171; White, Howard Ray, Bloodstains, An Epic History of the Politics That Caused the Civil War; Woods, Jr., Thomas E., The Politically Incorrect Guide to American History, p. 34
 White, Howard Ray, Bloodstains, An Epic History of the Politics That Caused the Civil War
 Woods, Jr., Thomas E., The Politically Incorrect Guide to American History, p. 34
 Woods, Jr., Thomas E., The Politically Incorrect Guide to American History
 Woods, Jr., Thomas E., The Politically Incorrect Guide to American History, p. 34
 Woods, Jr., Thomas E., The Politically Incorrect Guide to American History, p. 34
On December 16, 1773, British-American colonists boarded ships and dumped 342 chests of tea into Boston Harbor to protest British tax policies. This act, later called the “Boston Tea Party,” inspired other colonists to resist British infringements on their rights, which ultimately led to American independence.
The incident later called the “Boston Tea Party” stemmed from the monopoly on tea that Parliament had granted to the East India Company. Along with this monopoly came various taxes, which colonists protested because they had no direct representation in Parliament.
There were many other grievances, but most of them derived from these two principal issues. Destroying the tea demonstrated colonists’ frustration with British policies, and Britain’s response would only provoke further acts of defiance leading to an all-out war of secession from Great Britain.
The East India Company
Tea was the most prevalent drink for British subjects, and the East India Company was granted a near monopoly on importing tea to Great Britain in 1698. In 1721, the British Parliament required the American colonies to import their tea only from England, which allowed the East India Company to virtually corner the colonial tea market. The company delivered tea to England, where it was sold at auction and then exported to the colonies, where it was resold to colonial merchants.
By the early 1770s, the East India Company was on the verge of bankruptcy, primarily because it was required to pay taxes on all tea imported to England and exported to the colonies. This caused the price of tea to rise in the colonies. In response, colonists began buying cheaper, smuggled tea from Holland since that tea was not taxed by the Dutch government. East India representatives lobbied Parliament for help.
Parliament bailed out East India by lowering the importation tax to England and removing the export tax to the colonies. Partly to recover lost revenue from the tax decreases, Parliament enacted the Townshend Act, which introduced many colonial taxes, including a tax to import the East India tea. These new provisions were intended to stop the Dutch smuggling problem, but they only exacerbated another issue.
Taxation Without Representation
The Townshend Act was bitterly protested in the American colonies, as colonists argued that, as British subjects, they could not be taxed without consent from their elected representatives. The colonists were not permitted to elect their own members to the British Parliament, and as such they maintained that only their colonial representatives had the power to tax them. Parliament responded by enacting the Declaratory Act, which asserted the right to legislate for the colonies “in all cases whatsoever,” including taxes.
The protests, boycotts and smuggling continued until Parliament finally removed all Townshend importation taxes except for the tax on tea. British Prime Minister Lord North insisted on maintaining the tea tax to assert “the right of taxing the Americans.” Since all other taxes were removed, the colonists were temporarily satisfied.
But the tea tax harmed the East India Company, causing prices to rise and sales to drop. Again East India representatives lobbied Parliament for help, but the North ministry was reluctant to remove the tea tax because it would signal a victory for the colonists on the taxation issue. Moreover, the tax was used to pay colonial officials to keep them dependent on Britain and not their constituents.
The Tea Act
Parliament rescued the East India Company again by enacting the Tea Act in May 1773. This saved the company from bankruptcy by removing the export tax to the colonies altogether. At the same time, Britain maintained the import tax on the colonies. In addition, East India could sell directly to the colonies without moving the tea through Britain first. Parliament appointed colonial merchants to receive the tea on consignment and then sell it to the colonists for a commission.
British officials thought this act would be celebrated in the colonies because tea would be cheaper despite maintaining the import tax. However the law carried unintended consequences that prompted colonial outrage.
By allowing East India to directly sell its tea to colonial consignees, nearly all other tea-related business was undercut. Merchants buying cheaper, smuggled tea faced financial ruin under this new law. Also, merchants not politically connected enough to be appointed as consignees also faced ruin. And even worse, many feared that if this system could be imposed for tea, it could be extended to other goods as well. This helped resurrect the old dispute over whether members of Parliament had the power to tax colonists who did not elect them.
Many colonists argued that retaining the importation tax was an unnecessary provocation. The North ministry countered that the tax was necessary to pay colonial officials’ salaries. In addition, retaining the tax was a symbolic gesture demonstrating the power of the British government over the colonies. This symbol, more than the tax itself, prompted outrage in America. Colonists assembled to discuss not only boycotting the tea but preventing it from being delivered altogether.
As news of the Tea Act spread, protest groups such as the Sons of Liberty began forcing consignees to resign. In Philadelphia, a mass protest ousted the city’s consignees and compelled the tea ship to return to Britain without unloading its cargo. The tea ship in New York City was forced to turn back without delivering its tea, and the consignees resigned as well. But Boston was a different story.
In Massachusetts, the only colony in which the tea import tax was fully enforced, Royal Governor Thomas Hutchinson declared that tea ships would not be permitted to return to Britain until the tea was unloaded and the import taxes were paid. Hutchinson persuaded Boston’s consignees, two of whom were his sons, to hold firm.
When the tea ship Dartmouth arrived in Boston Harbor in November 1773, Sons of Liberty member Samuel Adams called for a meeting at the Old South Church. About 8,000 people heard Adams inform them of Governor Hutchinson’s policy regarding tea ships. Meeting attendees adopted a resolution urging the Dartmouth captain to return the ship to Britain without collecting the import tax. Men were assigned to watch the ship and prevent the tea from being unloaded.
But Hutchinson remained adamant, and soon two more tea ships arrived in Boston Harbor. On December 16, about 7,000 people gathered at the Old South Church for another meeting. As Adams tried maintaining order among the outraged citizens, people poured out of the church and headed for the harbor to protest. Later that evening, about 130 men led by Lendall Pitts disguised themselves as Mohawk Indians and boarded the tea ships. Over the next three hours, they dumped all 342 chests of tea into the water.
While many Boston authorities supported the tea’s destruction, the act enraged British officials in London. Governor Hutchinson urged Parliament to suppress the Sons of Liberty. Prime Minister North said, “Whatever may be the consequence, we must risk something; if we do not, all is over.” Consequently, a series of acts were passed, including:
- The closure of Boston Harbor to all commerce until reimbursement to the East India Company for the lost tea
- Denying citizens of Massachusetts the right to elect their own colonial representatives
- Allowing trials for colonial officials accused of harming colonists to be moved to Britain
- Extending Quebec and allowing Catholicism to spread there (causing fear among the primarily Protestant colonists)
These and other laws passed to keep the colonies obedient to Britain came to be known in America as the “Intolerable Acts.”
Moving Toward Secession
Samuel Adams publicized and defended destroying the tea in Boston Harbor. Others denounced the action, including Benjamin Franklin, who declared that the East India Company must be repaid for its loss. Similar incidents occurred in other colonies, though they did not receive as much publicity as the action in Boston.
As Britain attempted to tighten its grip on the colonies, the colonists increased their protests and resistance to the “Intolerable Acts.” Many colonists living outside Massachusetts feared that the punitive measures being administered to that colony could someday be extended to them, and as such they joined the protests. Colonists coordinated boycotts and began talking of suspending trade with Britain altogether.
The responses and counter-responses to grievances between the American colonies and Great Britain ultimately led to the First Continental Congress being formed in 1775. The Congress petitioned King George III to repeal the “Intolerable Acts,” and when the petition was denied, the colonists engaged in open rebellion against the Crown. This led to the War for Independence and the creation of the United States of America.
The “Tea Party” Name
The term “Boston Tea Party” was not coined in print until 1834. Prior to that, the event was most often called the “Destruction of the Tea.” Since the Tea Party, U.S. activists from various political viewpoints have invoked the name as a symbol of protest. The current “Tea Party” movement in the U.S. has urged a return to the country’s founding principles of limited government, individual freedom and responsibility, and reduced taxation.
In November 1798, Thomas Jefferson and James Madison began writing what became known as the Virginia and Kentucky Resolutions. These argued that states had the right to nullify unconstitutional federal laws. The arguments behind these resolutions are still invoked today.
After having freed themselves from the British monarchy, the American founders believed that the best way to preserve individual freedom was to limit and decentralize the new national government. At the Constitutional Convention of 1787, most delegates agreed that the federal government should not have the exclusive authority to interpret the new Constitution because it would routinely interpret the document in its own favor, thus expanding and centralizing power over time. The states had to have redress against federal attempts to consolidate power.
The federal power grab that most state delegates feared came true in 1798 with the passage of the Alien and Sedition Acts. These laws limited the rights of foreigners and curtailed political opposition by prohibiting government criticism.
The acts blatantly violated the First Amendment guaranteeing freedom of speech and the press. Since the Federalists controlled the government, they targeted their Democratic-Republican opponents for prosecution under the new laws; authorities arrested at least 21 Democratic-Republican newspaper editors and suppressed their papers. A man expressing the fond wish that the presidential saluting cannon would “hit (President John) Adams in the ass” was fined $100. Many Democratic-Republicans, including Vice President Thomas Jefferson and James Madison, feared that government officials were tampering with their mail.
This marked the first U.S. crisis regarding civil liberties, and they prompted widespread outrage. In response, Jefferson and Madison wrote protests arguing that the Alien and Sedition Acts were not only unconstitutional, but that they should not be enforced by state governments. This marked the first application of states’ rights in U.S. history.
Thomas Jefferson wrote the Kentucky Resolutions in 1798, which stated that the Kentucky state legislature should nullify the Alien and Sedition Acts. James Madison followed a month later with the Virginia Resolutions, urging the Virginia legislature to do the same.
Jefferson asserted that not only did the Alien and Sedition Acts obviously violate the First Amendment, but they also violated the Tenth Amendment, which to Jefferson was the foundation on which the entire Constitution was based. (The Tenth Amendment delegates all powers not specifically given to the federal government to the states and the people.) Jefferson wrote that states did not authorize the federal government to enact laws infringing on constitutional freedoms. Thus, the Alien and Sedition Acts violated a state prerogative. To remedy this, Jefferson argued that states had not just the right but also the duty to nullify unjust federal laws by refusing to enforce them within their borders.
The Virginia and Kentucky Resolutions introduced the theory of “interposition,” or the right of state citizens to decide for themselves, through their local political representatives, whether a federal law was constitutional. The argument relied on the premise that the states had existed before the federal government, and they had voluntarily agreed to form a federal government to serve their interests. Because of this, states had the right to review federal laws and decide whether to enforce them.
The resolutions supported the “compact” theory of government, under which the federal union of states is a mutual agreement, and that powers not transferred to the federal government must be retained by the states under the Tenth Amendment. While Federalists argued that only federal courts could decide whether a federal law was constitutional, Jefferson and Madison argued that states also had the power to decide on federal laws. And if a state decides that a federal law is unjust, the state has the right to nullify that law.
While there is no provision in the Constitution that authorizes nullification, Jefferson and Madison argued that no one side in a “compact” can have the exclusive right of interpreting its terms. This was especially true in the case of the federal compact because, as John C. Calhoun later contended, the federal government was not a party to the compact, since it was created by the joint action of the states.
Nullifying Federal Laws
Despite the resolutions urging them to take action, the state legislatures in Virginia and Kentucky did not nullify the Alien and Sedition Acts. Instead, the laws quietly expired in 1801. But over the years, states invoked their right to nullify federal laws on several occasions.
In the 1810s and 1820s, several states levied taxes on the national Bank of the United States, arguing that sovereign states had the right to tax federal institutions within their boundaries. Although the Supreme Court ruled such taxation unconstitutional, many have contested that states should not be bound by decisions from federal judges who will almost always vote to enhance federal power.
In 1832, South Carolina nullified a federal tariff law and threatened to secede from the Union. President Andrew Jackson countered by threatening to lead a federal army into the state. A compromise was finally reached between federal and state officials in 1833, and the crisis was temporarily averted.
Historians generally associate nullification with the South, but in the 1850s, several northern states nullified the Fugitive Slave Act, directly citing the Virginia and Kentucky Resolutions as justification. The North invoked nullification and states’ rights most effectively before the Civil War by refusing to enforce federal fugitive slave laws. Contrary to most historical accounts, when the war began in 1861, it was prompted not by southern states nullifying federal laws, but by southerners protesting that northern states were nullifying federal laws.
Critics of nullification point to the fact that it has been used to suppress civil liberties. In the 1950s and 1960s, many southern states invoked the principle of states’ rights by resisting federal attempts to provide civil and voting rights to blacks. This sparked the Civil Rights Movement, and despite southern attempts to suppress the political voice of blacks, the right to life, liberty, and property under natural law trumped states’ rights. This followed the model of power the founders intended when drafting the Constitution–first individual liberty under natural law, then local government, then state government, and finally federal government.
Applying the Resolutions Today
The main point of the Virginia and Kentucky Resolutions was that a national government allowed to decide the scope of its own power will almost always decide to enhance its power at the expense of the people. And the founders knew that as government grows, liberty shrinks. States asserting their right to nullify federal laws under their Tenth Amendment power could go a long way in limiting the power of the federal government, which would enhance individual liberty.
A nullification movement has recently taken shape in the U.S. One of the movement’s primary targets is the Health Care Reform Act of 2010. Many state legislatures have passed resolutions refusing to enforce the law within their borders. This is a direct application of the Virginia and Kentucky Resolutions written 212 years ago. Thus, the “principles of ‘98” meant to keep the power of the federal government in check and guarantee individual freedom are alive and well today.
Alexander Hamilton was one of the most influential figures in forming the United States. President George Washington appointed Hamilton as the first U.S. treasury secretary, largely because of his background in economics and his service in the War for Independence. But Hamilton sought to transform America into another England by centralizing power in the national government at the states’ expense. And politicians have copied this approach ever since.
At the Constitutional Convention, Hamilton pushed to create a strong central government. He proposed that the president serve for life as a quasi-king, with powers to appoint state governors and veto federal and state laws. Hamilton only reluctantly endorsed the final version of the Constitution because it was a slight improvement upon the decentralized Articles of Confederation.
Although he worked to persuade the states to support the new Constitution in The Federalist papers, Hamilton truly admired the British mercantilist system. This system featured excessive government spending that created massive debt, and high taxes that raised money to subsidize favored businesses in exchange for political favors. Believing that this was what made Great Britain a world power, Hamilton set out to create a similar system in America.
Three reports that Hamilton issued to Congress reflected his basic economic philosophy. The proposals in these reports perverted the Constitution’s intent by trying to centralize power in the federal government. They also set a trend for economic policy and constitutional interpretation that most politicians still favor today.
Report on the Public Credit
Hamilton’s first report Congress offered two proposals. First, the federal government would assume all state and non-federal debts, then combine them with the national debt; this was called “assumption.” Removing financial obligations from the states would harm their credit and make them more dependent on the federal government in handling the economy. Southerners in Congress opposed this plan, not only because it weakened state power, but because most debt was in the northern states, and those in debt-free states felt no obligation to bail out less fiscally prudent states.
Second, the federal government would repay the debt by selling government bonds. Most of the current national debt was in bonds issued to war veterans in lieu of pay. Paying this off by issuing more bonds would create a permanent cycle of debt that would finance future government operations. It would also entice creditors to ally themselves with the new government, thus forming a relationship between business and government that was strikingly similar to that in England.
Many, including Secretary of State Thomas Jefferson and Congressman James Madison, argued that the Constitution had no provision to allow such proposals as these. Hamilton countered that these were among the federal government’s “implied powers,” in which the ends (funding the government) justified the means (violating the Constitution). Ultimately, southerners agreed to support the Assumption Bill when northerners agreed to move the national capital from New York City to the South.
Politicians have used Hamilton’s notion of “implied powers” to justify unconstitutional measures ever since. Disagreements over Hamilton’s plan led to the creation of political factions, the forerunners to political parties. In addition, the federal assumption of state debts set the trend of placing the federal government in control of the national economy, which continues today. It also led to the creation of Washington, DC, the future national capital.
Report on a National Bank
Hamilton’s second report offered two more proposals. First, a U.S. Mint would be created to print a national currency. At the time, state and local banks printed their own money, leading to various currencies with different exchange rates. Hamilton argued that the U.S. needed a uniform monetary system if it was going to survive and prosper.
Second, a national bank would be created to hold government revenue, meet the government payroll, circulate the new national currency, and provide steady credit to the federal government. The bank would be created by selling $10 million in stock, of which the U.S. would buy a share of $2 million. Since the U.S. did not have $2 million, Hamilton would arrange a U.S. loan to itself, which was essentially illegal. The other $8 million in shares would be bought by private investors. This was modeled after the Bank of England.
Southerners were suspicious of a central bank that could infringe on states’ rights by allowing private investors to gamble with taxpayer money (i.e., allowing bankers to feed at the public trough). Hamilton countered that the Constitution provided the federal government with the “necessary and proper” power to tax, coin money, and regulate interstate commerce, and under this, a national bank was a means to the end. After consulting with his cabinet, President Washington reluctantly signed the Excise Bill into law, and the Bank of the United States became the forerunner to today’s Federal Reserve System.
Hamilton’s argument that it is valid to use unconstitutional means (creating a mint and national bank) to achieve a constitutional end (coin money, collect taxes, etc.) set a vital trend. It helped ally government with private bankers and investors, creating the mercantilist system—also known as crony capitalism—that dominates the U.S. economy today.
Report on Manufactures
In Hamilton’s third report, he wrote, “The public purse must supply the deficiency of private resources.” To remedy this, he offered two proposals. First, tariffs (i.e., taxes) would be imposed on imported goods to make American products cheaper and more desirable. Second, revenue from the tariffs would be used to provide “bounties” (i.e., subsidies) to stimulate industry and make America competitive on a global scale.
Opponents argued that the Constitution only allowed the federal government to impose tariffs to raise revenue, not to protect American business. They also argued that subsidizing favored businesses had no constitutional basis. Others noted that such a system was suspiciously like the British system that so many Americans had just fought to get rid of.
Hamilton countered that such a program would benefit the “general welfare” of the nation, as provided in the Constitution. Once again, the ends (national stability) would be justified by the means (unconstitutional taxing and spending).
Congress rejected this report, but it reemerged in later years and was eventually adopted by the Whig, Republican, and Democratic parties in various forms. Hamilton’s economic policy set the trend for subsidizing businesses, which is known as “pork barrel spending” today.
Hamilton’s Policies Remain
Many of America’s founders, most notably Thomas Jefferson and James Madison, stringently opposed Alexander Hamilton’s economic policies. In fact, Jefferson ultimately resigned from George Washington’s cabinet in protest of Washington’s support for Hamilton. This helped forge the first political factions in the U.S.: the Republicans led by Jefferson and the Federalists led by Washington and Hamilton.
Hamilton recognized the coming of the industrial revolution. He also saw great potential in allying industry and capitalism to transform America into a world power. However, Hamilton tried to speed up the alliance through government intervention. This only led to mercantilism, which is the antithesis of the free market capitalism that many Americans had sought after freeing themselves from England.
Hamilton’s quest to centralize power weakened the sovereignty of the states and the people. This contradicted most founders who drafted the Constitution. Hamilton’s liberal constitutional interpretations have reduced the states’ ability to resist the growing federal authority. They have also produced philosophical descendants such as Henry Clay, Daniel Webster, Abraham Lincoln, Woodrow Wilson, Franklin D. Roosevelt, Richard M. Nixon, George W. Bush, and Barack Obama.
Hamilton’s ideas of accumulating national debt, creating a national bank, and subsidizing favored businesses have been fully enacted in one form or another. There is a vast national debt, banking is centrally planned through the Federal Reserve System, and many businesses and industries are routinely subsidized with taxpayer money. Over 200 years after his death, Alexander Hamilton’s vision for America is now a reality. And in many ways, Hamilton’s ideas betrayed the principles that Americans fought for in the War for Independence.
- DiLorenzo, Thomas J., Hamilton’s Curse: How Jefferson’s Archenemy Betrayed the American Revolution–and What It Means for Americans Today (New York: Crown Publishing Group, 2008)
- Schweikart, Larry and Allen, Michael, A Patriot’s History of the United States (New York: Penguin Books, 2004)
- Wikipedia: Alexander Hamilton
To most of America’s founders, the right of secession was a fundamental part of their political philosophy. After all, the first secession movement was the war of secession from Great Britain, often misnamed the Revolutionary War. Moreover, the Declaration of Independence is a declaration of secession from Britain.
According to the Declaration, a government derives its power from the consent of the governed, and if a government becomes destructive to the citizens’ rights to life, liberty, and property, citizens have a right to secede from that government and form a new one. In this way, secession was considered the most important check against an abusive centralized government. This was the basis of both the War for Independence in 1776 and the War for Southern Independence (often misnamed the Civil War) in 1861.
During the War for Independence, the states considered themselves free and independent countries. Each state declared its individual and independent sovereignty from Britain on its own. When the war ended, King George III signed a peace treaty with each individual state, not with the “United States government.”
After the war, the separate states created the “Articles of Confederation and Perpetual Union.” This established the federal government as a limited agent of the states. However, the federal government was given such limited powers that it was too ineffective. So the states then seceded from that document and created the Constitution that we live under today.
The Constitution’s Intent
In creating the Constitution, the founders deliberately and explicitly gave the federal government limited powers. These powers were mostly confined to national defense, interstate commerce, and foreign affairs. The founders had just fought a war to free themselves from an overbearing central government, so they weren’t about to create one of their own. This is why the Constitution is an intentionally decentralizing document when taken at its literal (and correct) meaning.
Most delegates to the Constitutional Convention wanted to create a stable federal government, but not one that would interfere with the states’ right to govern themselves. James Madison proposed to empower the federal government to veto state legislation, but this proposal was overwhelmingly defeated because such a thing would have repudiated the very reason why the Americans fought to free themselves from Britain. Even though the proposal was defeated, it’s common practice for the Supreme Court to veto state legislation today. This was not the founders’ intent.
For the Constitution to become law, state conventions had to approve it. The delegates at these conventions would not have approved the Constitution if they knew that the federal government would one day exercise absolute supremacy over the states and forbid them from seceding. In fact, three states (Virginia, New York, and Rhode Island) passed resolutions reserving the right to secede from the Union if necessary when they approved the Constitution.
At the time, the term “United States” was a plural term referring to the individual states united voluntarily in a compact. It was understood that the country was a collection of sovereign states that agreed to delegate certain specific powers to the federal government. The power of the federal government was granted by the states for their mutual benefit. The states allowed the federal government to operate, not the other way around.
Secession was viewed as the last check on the potential abuse of power by the federal government, and the Constitution was written with the right of secession in mind. Secession is not prohibited in the Constitution, and the Tenth Amendment states that any powers not granted to the federal government are reserved for the states or the people. In fact, during the Constitutional Convention, a proposal to empower the federal government to suppress a state’s right to secede was rejected.
Many founders, including Thomas Jefferson and James Madison, believed that the Tenth Amendment was the most important part of the Constitution. They believed that true freedom comes only through dispersing political power, not consolidating it in Washington, DC. This is why the Tenth Amendment is among the most ignored of the constitutional amendments in Washington today.
James Madison also believed that the Second Amendment protected the people from a potentially harmful central government. Most founders knew that allowing citizens to arm themselves would empower them to protect themselves, which essentially meant that they supported armed secession if necessary. If they supported armed secession, and if armed secession is permitted under the Second Amendment, then certainly peaceful secession would be permitted as well.
Most founders didn’t intend for federal laws to trump state laws. Many politicians and lawyers invoke the “supremacy” clause of the Constitution to declare that federal power is supreme over state power. However, the original intent was to grant the federal government supremacy over the states only in the specific powers listed. All other powers were reserved to the states or the people under the Ninth and Tenth Amendments.
The Bill of Rights was added to the Constitution as a check on federal power over states. Most Americans believed that states could pass laws to override the Bill of Rights because the federal government had no authority over state law.
A few years after this country’s founding, the federal government passed laws infringing on the First Amendment’s freedom of speech. In response, Jefferson and Madison wrote the Virginia and Kentucky Resolutions, which argued that states had the right to “nullify” federal laws they believed to be unconstitutional. This declared the supremacy of the states in the federal system, and they received little criticism at the time. If someone made these same arguments today, they would be vilified by the mainstream media.
Today politicians refer to the notion of “implied powers,” or the “general welfare” clause in the Constitution to justify supporting unconstitutional laws and ideas. They don’t acknowledge that the intent was to promote the general welfare only through the powers specifically listed in the Constitution.
By refusing to acknowledge the true intent, they have the power to pass any law they want while completely disregarding the Constitution’s documented amendment process. The original intent was to amend the Constitution, not let politicians and courts interpret it any way they pleased to suit their political purposes.
The New England Secession Movement
The first major secession movement was initiated by the Federalists in the New England states because they opposed the policies of southern presidents Jefferson and Madison. The New Englanders argued that their right to self-government was being abused, and they were opposed to a tyrannical federal government that didn’t respect their interests. These were the same arguments made by the southern secessionists before the Civil War.
The New England Federalists despised the Louisiana Purchase, the trade embargo against Britain (their most profitable trading partner), and the War of 1812. As a result, they plotted for several years to secede from the Union. Among those advocating secession was Timothy Pickering, former secretary of state under George Washington.
During the War of 1812, the federal government enacted a military draft. Many state governors and legislators denounced the draft as unconstitutional. Massachusetts and Connecticut refused to send state troops for federal service against the British, thus effectively (albeit temporarily) seceding from the Union.
Delegates from the New England states met at the Hartford Convention in 1814 to discuss secession. They finally agreed not to secede, but only because it wasn’t in their economic interests. There is no record of anybody questioning whether or not secession was legal.
By the time the convention ended, the war with England was over and many Americans turned against the New Englanders. Because most New Englanders didn’t support the war, their secession movement was branded as treasonous. Many people were outraged that New Englanders would debate seceding in a time of war. This gave birth to the idea that secession is treason.
The Push for Centralization
From the beginning, a minority of founders supported a stronger federal government. Their leader was Alexander Hamilton, and they became known as the Federalists. They later evolved into the Whig Party, and then just before the Civil War they morphed into the Republican Party.
Hamilton argued that the nation as a whole was supreme over the states. Federalists in the Supreme Court, lifetime lawyers who aren’t elected, upheld this view. Later on, many Whigs and even some Democrats like Andrew Jackson began arguing that the national union was indivisible, and any attempt to secede would be stopped by force. These false arguments were taken up by Abraham Lincoln when he became president.
Most founders denounced these arguments, but these provided the basis to deny state sovereignty, to deny secession, and to empower the military to invade the South. The idea that the national union is indivisible and supreme over the states could be the biggest myth in American political history, even though most Americans believe it today.
In the buildup to the Civil War, more and more southerners began threatening secession, and more and more northerners began calling them traitors for it. But according to the founders, secession is not treason. If secession cannot be used to check an overpowering federal government, what incentive does the federal government have to check itself?
Although the federal government was intended to be decentralized, those who favored more power through a centralized government rewrote history to suit their political purposes. Thus came the big myth that the national union is supreme and indivisible, and that secession is treason. This myth was upheld at gunpoint by the Union army during the Civil War.
The Southern Secession and Civil War
The southern states seceded from the Union just as the American colonies seceded from Great Britain in 1776. But while the first secession is generally viewed as the glorious birth of a new country, the second secession is usually viewed as a treasonous attempt to destroy America. The winners write the history books, regardless of whether they are right or wrong.
Many southerners believed that the federal government had been acting in an unconstitutional manner for many years, and this had hurt the South more than the North. Southerners believed that secession was their trump card because they interpreted the Constitution as the founders intended. Few people in the South thought that Lincoln would wage such a costly war against such an inherent right.
Lincoln argued that secession would lead to “anarchy.” But through history there have been many peaceful secessions. And if anarchy was feared, isn’t it ironic that the 16 years of civil war and Reconstruction represent the worst episode of anarchy in American history?
Lincoln argued that secession would cause representative government to “perish from the earth.” However, during the war, representative government did not perish but instead existed in both North and South, and most likely would have continued as such had the war not been fought.
Lincoln argued that secession would “destroy” the country. However, the federal government that was “destroyed” by the secession of the southern states ultimately fielded the largest and best-equipped military in history.
In his Gettysburg Address, Lincoln stated that the war was being fought to defend government by consent. However, the opposite was true: The federal government was fighting to deny the southern states their right of government by consent because they certainly did not consent to remaining in the Union.
Although Lincoln waged a war against the right of secession, he approved the secession of West Virginia from the rest of the state simply because the region was pro-Union and pro-Republican. So Lincoln favored secession if it suited his political purposes. West Virginia provided more electoral votes for Lincoln’s re-election in 1864, and it provided more Republican representation in Congress. This benefited the Republicans, not the people.
For the Civil War and Reconstruction to be legal, the founders at the Constitutional Convention would have had to agree to the following:
- That no state could secede from the Union for any reason;
- That if a state tried to secede, the federal military could invade to stop it;
- That after preventing secession, the federal military could control the state until it accepts federal supremacy;
- That the federal authorities could impose new constitutions on states.
No founder, not even Alexander Hamilton, would have agreed to such terms when drafting the Constitution.
Consequences of the Civil War Today
Waging a war to save the Union meant waging a war to kill federalism and states’ rights, two principles that were essential parts of this country’s foundation. State sovereignty is meaningless if a state does not have the right to secede. The right of secession as a check against an abusive federal government has been removed as a result of the Civil War.
The federal government will never move to check its own power, which is why the principles of federalism and states’ rights were so important. This meant that the people, as citizens of their states, were no longer sovereign. The federal government has become the master, rather than the servant, of the people, which is exactly what the founders fought so hard to prevent.
Today, we live under the European idea that citizens should be obedient to the central state. This was the same idea that caused so many Europeans to migrate here in the first place.
Another result of the Civil War is that most politicians today interpret the Constitution as a grant of powers instead of a restraint on government as originally intended. In fact, most politicians and judges believe that any law should be allowed as long as it is not explicitly prohibited by the Constitution. This is the opposite of what the founders intended, which was that no law should be allowed unless it is explicitly permitted by the Constitution.
To most founders, the War for Independence transferred sovereignty from the King of England to the American people. The people were meant to express their sovereignty in political communities organized at the state and local levels. Today, the federal government is sovereign over the people, mostly in the form of the Supreme Court, which consists of unelected government lawyers serving for life.
There are no longer any real restraints on the federal government’s power to plan, regulate, and control any part of our life that it chooses. Witness the 2009-2010 debate over health care reform; hardly anywhere was the argument presented that the very notion of federal involvement in the health care of citizens is unconstitutional; it was simply assumed that the federal government is empowered to regulate such a thing when it truly should be reserved to the states or the people under the Tenth Amendment. The same goes for corporate bailouts, regulating energy output, investigating steroids in baseball, and on and on.
The “big myth” that the national union is indivisible and supreme over the states was upheld by the Civil War. This allowed the federal government to ignore its constitutional restraints to the point that the Ninth and Tenth Amendments are pretty much meaningless today.
The Civil War destroyed the principle in the Declaration of Independence that “Governments are instituted among Men, deriving their just powers from the consent of the governed.” Secession is a prerequisite for a self-governing people. If people are not sovereign over their government, they are mere tax serfs.
America was founded by a war of secession from Britain, and nothing is more a part of American political tradition, even though it is largely either forgotten or viewed negatively by most Americans today.
In 1787, a convention was held to strengthen the Articles of Confederation that governed the new United States. However, the delegates instead seceded from the nation under the Articles and drafted what became the U.S. Constitution.
The new United States of America had been independent from Great Britain for just six years. The Articles of Confederation codified the national laws, created and executed by the Continental Congress.
The Congress consisted of one delegate from each state, and most votes required unanimous consent to pass. There was no executive leader and no national court system. This type of government was proving largely ineffective.
To strengthen the Articles of Confederation, a convention of state delegates assembled in May 1787. But as the convention progressed, it became clear that the Articles would be completely replaced by a new national constitution that remains the law of the land today.
The “Grand Convention at Philadelphia” formally convened on May 25, and eventually 55 of the 73 selected delegates attended. Of the 13 states, only Rhode Island refused to send a delegate. Others refusing to attend were Revolutionary War leaders Samuel Adams, Richard Henry Lee and Patrick Henry, who “smelt a rat in Philadelphia, tending toward the monarchy.”
Those unable to attend included John Adams (in England) and Thomas Jefferson (in France). Nevertheless, Jefferson called the convention as “Assembly of Demi-Gods.”
The oldest attendee was 81-year-old Benjamin Franklin. Other prominent attendees included James Madison, Alexander Hamilton, William Paterson, Edmund Randolph, and Roger Sherman. Delegates selected General George Washington to preside over the convention.
The first vote resolved to keep the proceedings entirely secret from the press and the public. The delegates then began debating how to best revise the national government and laws.
While there were various opinions about how the national government should function, the delegates generally belonged to two factions:
- The nationalists (later called the Federalists), led by Hamilton, believed the Articles of Confederation were too weak and sought a much stronger, centralized national government at the expense of state sovereignty.
- The anti-nationalists (later called the Anti-Federalists, then the Democratic-Republicans) preferred to strengthen the Articles along with guarantees that states’ rights would not be overridden by a national entity.
The convention exposed sharp differences not only between nationalists and anti-nationalists, but also between farmers and merchants, slaveholders and non-slaveholders, and northerners and southerners. Soon it was resolved that the Articles could not address these differences, and thus an entirely new government and constitution would be needed.
The Legislative Branch
One of the first debates was about how the national legislature would be assembled to make laws. Edmund Randolph proposed the “Virginia Plan” whereby a bicameral (i.e., two-chamber) legislature would feature one chamber’s members being elected by the people and one chamber’s members being elected by state assemblies. Both chambers would base membership on state population. Naturally, delegates from large states like Virginia favored this plan because they would enjoy the most representation.
In contrast, William Paterson proposed the “New Jersey Plan” whereby a unicameral (i.e., one-chamber) legislature would have the same number of members for each state. Naturally, delegates from smaller states like New Jersey favored this plan because they would have equal input in the legislature with the larger states.
To bring the plans together, Roger Sherman proposed the “Connecticut Compromise” whereby there would be a bicameral legislature:
- The lower chamber (the House of Representatives) would contain members elected by the people every two years, and membership would be based on state population.
- The upper chamber (the Senate) would contain members elected by state assemblies every six years, and there would be an equal number of members for each state.
Once the compromise was reached, more legislative facets were adopted:
- Since House members were directly elected by the people, all matters of taxation and revenue would originate in that chamber.
- Since the Senate was to be the more deliberative body, the age requirement for senators would be higher than representatives.
- The Senate would to ratify all international treaties and approve all executive and judicial appointments.
These provisions were codified in Article I of the new constitution.
Separation of Powers
The delegates agreed that the government’s powers should be separated to moderate authority and thus better prevent tyranny. For example:
- The legislative branch (Congress) would be empowered to make laws.
- The executive branch (the president and advisors) would be empowered to enforce laws.
- The judicial branch (the Supreme Court and lower federal courts) would be empowered to interpret laws.
A series of checks and balances were also adopted to better ensure that one branch did not become dominant over the others. For example:
- The legislature would make laws, but the executive could veto laws.
- The legislature could override executive vetoes with a two-thirds majority.
- The executive would appoint the judiciary with the consent of the legislature.
- The executive would command the military but the legislature would be empowered to declare war.
- The legislature could impeach and remove executive and judicial officials if the need arose.
- The judiciary could decide on the legality of laws, but the legislature would approve judicial appointments.
Separating powers and implementing checks and balances helped ensure that change would be deliberate and slow. The framers knew that the slower government moved, the more limited it became since issues would tend to resolve themselves without government intervention. And more limited government meant more liberty among the people.
Since members of the House of Representatives would be elected based on state population, a debate ensued over how the population would be counted. During this debate, the contentious issue of slavery took center stage.
Slaves comprised about 40 percent of the population in the southern states. Most southern delegates rejected any proposals to limit or outlaw slavery, and they wanted slaves to be counted as part of the general population because it would inflate their numbers and provide for more House representation.
Most northern delegates opposed counting slaves for population since they were not considered citizens and had no political rights. Also, counting slaves would artificially increase southern power in the House, thus perpetuating slavery.
James Wilson of Pennsylvania offered a compromise whereby each slave would be counted as three-fifths of a citizen in determining representation. In addition, the slave trade would be abolished within 20 years, and national taxes could be levied on slavery. To determine population, a census would be conducted in the first year of every decade.
This compromise favored the South by granting the southern states more population without taxation since slavery was never taxed. This strengthened the pro-slavery bloc in the federal government and converted slavery, which most delegates hoped would be temporary, into a permanent institution.
Several delegates submitted proposals for how the executive should be organized. These proposals included:
- An executive committee consisting of members appointed by the legislature.
- A three-man executive committee consisting of one from the North, one from the South, and one from the middle states.
- A one-man executive who would serve for life and have veto power over all federal and state laws. This was Hamilton’s idea, but many considered it too reminiscent of the British monarchy.
After 60 ballots, delegates approved creating a single executive called the president; this was the first national executive in American history.
- The president would be elected by an electoral college, which would shield against direct democracy and the potential dominance of large cities over states. (This worked exactly as intended in 2000 when Al Gore received the majority vote in most big cities while George W. Bush won more electoral votes in the states and thus won the election.)
- The president would be commander-in-chief of the national military.
- The president was empowered to appoint all executive and judicial officials.
- The president was empowered to negotiate international treaties, thus becoming the nation’s foreign policy leader.
These provisions were codified in Article II of the new constitution.
The first national judiciary in American history was created:
- A Supreme Court would be established, and the legislature would establish how many judges would serve.
- The legislature would create circuit and appeals courts below the Supreme Court.
- Federal judges would be appointed by the president and confirmed by the Senate.
- The judges would have jurisdiction over all federal and interstate legal disputes.
- The judges would serve lifetime terms.
The judiciary was not empowered to cancel laws deemed illegal through what was later called “judicial review.” It was merely authorized to interpret laws and render opinions. However, judicial review was first invoked in the 19th century and it has since been extended to state as well as federal law, even though such a power was specifically rejected by the delegates at the convention.
The Final Document
On the constitution’s final draft, Gouverneur Morris of Pennsylvania reworded the preamble from “We the States” to “We the People of the United States.” Historians have maintained that this meant the federal government was supreme over the states. However, the rewording was done because it was still unclear if the states would approve the document. The final draft explicitly proclaims the federal government is supreme over the states only in the powers enumerated in the various articles.
On September 17, 1787, 39 of the 55 delegates signed the final draft of the U.S. Constitution at the State House (now Independence Hall). Some unsatisfied delegates refused to sign, while others demanded that a bill of rights be added to further limit federal power. Some signed with the understanding that a bill of rights would be added later.
The Continental Congress voted in favor of sending the new Constitution to the state conventions for ratification. To become law, the Constitution had to be approved by at least nine of the 13 states. In 1788, New Hampshire became the ninth state to ratify the Constitution, making it the supreme law of the land.
The U.S. Constitution continues to stand as a model of compromise in governance. And its unique system of separation of powers and checks and balances has served to attempt limiting government and upholding individual liberty for over 200 years.