Every State will have to pay a sum of tax money into the treasury; and the treasury will have to pay, in every State, a part of the interest on the public debt, and salaries to the officers of government resident in that State. Suppose this were true: yet the constitution allows only the means which are ‘necessary’ not those which are merely ‘convenient’ for effecting the enumerated powers. Nor are they within either of the general phrases, which are the two following. To form the subscribers into a corporation. Back, Jefferson's Opinion on the Constitutionality of a National Bank : 1791. ‘to borrow money.’ But this bill neither borrows money, nor ensures the borrowing it. Seth Ames, i, 95–6; [William L. Smith], The politicks and views of a certain party displayed [1792], p. 17; both quotations from Ames and Smith are drawn from an article by Kenneth R. Bowling, “The Bank Bill, the Capital City, and President Washington” (Capitol Studies, I [1972]). 15 Feb. 1791 Papers 19:275--80 . Besides, the existing banks will, without a doubt, enter into arrangements for lending their agency, and the more favorable, as there will be a competition among them for it; whereas the bill delivers us up bound to the national bank, who are free to refuse all arrangement, but on their own terms, and the public not free, on such refusal, to employ any other bank. . It followed the Bank of North America, the nation's first de facto central bank. OPINION ON THE CONSTITUTIONALITY OF A NATIONAL BANK. It was intended to lace them up straitly within the enumerated powers, and those without which, as means, these powers could not be carried into effect. The Negative of the President is the shield provided by the constitution to protect against the invasions of the legislature 1. the rights of the Executive 2. of the Judiciary 3. of the states and state legislatures. [3] Thomas Jefferson, Opinion on the Constitutionality of a National Bank, in Thomas Jefferson: Writings, Edited by Merrill D. Peterson (New York: Viking Press, 1984), 416. Were it a bill to raise money, its origination in the Senate would condemn it by the Constitution. To consider the latter phrase, not as describing the purpose of the first, but as giving a distinct and independent power to do any act they please, which might be for the good of the Union, would render all the preceding and subsequent enumerations of power completely useless. To lay taxes to provide for the general welfare of the United States, that is to say, "to lay taxes for the purpose of providing for the general welfare." But there can be no doubt that political maneuvers in which both Washington and TJ were involved did connect the bank bill and the bill to amend the Residence Act (see note to group of documents on the location of the Federal District, under 24 Jan. 1791). A Founding Father’s Opinion Concerning the Constitutionality of a Federal Bank, 1791. February 15, 1791 Opinion against the Constitutionality of a National Bank The bill for establishing a National Bank undertakes among other things:— 1. These observations scarcely did justice to the convictions of those who advanced the constitutional argument and Madison categorically denied Smith’s allegation about a proposition to limit the charter to ten years (Madison’s “Outline of an Answer to a Pamphlet,” 1792; DLC: Madison Papers, cited by Bowling). The report on this subject, page 3. states the only general convenience to be the preventing the transportation and re-transportation of money between the states and the treasury. Thomas Jefferson believed this national bank was unconstitutional. But let us examine this convenience and see what it is. II. The second general phrase is ‘to make all laws. But they can all be carried into execution without a bank. 1. to form the subscribers into a Corporation. Yet neither of these persons regulates commerce thereby. 1 It would swallow up all the delegated powers, and reduce the whole to one power, as before observed. To enable them in their corporate capacities to receive grants of land; and so far is against the laws of Mortmain.(1). Nothing but a necessity invincible by any other means, can justify such a prostration of laws which constitute the pillars of our whole system of jurisprudence. Théophile Cazenove, representative of several Amsterdam firms, was not the only contemporary to observe a connection between the bank and the capital issues: “As those who desire that the seat of government be on the Potomac are united against the Bank, so the opposite party are united in its favor” (Cazenove to his principals, 5 Feb. 1791; Cazenove Letterbook). For the laying of taxes is the power, and the general welfare the purpose for which the power is to be exercised. But if there be no balance of commerce, either direct or circuitous, all the banks in the world could not bring up the surplus of taxes, but in the form of money. Therefore it was that the constitution restrained them to the necessary means, that is to say, to those means without which the grant of the power would be nugatory. 2. 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." Jefferson's Opinion on the Constitutionality of a National Bank : 1791 The bill for establishing a National Bank undertakes among other things: 1. 17: 197). Washington’s long delay in signing the bill did, of course, cause much anxiety on the part of Hamilton and others; Madison’s impassioned argument in the House of Representatives was a matter of public record; and the constitutional issue was discussed in the press (Federal Gazette, 21 Feb. 1791; Va. Gazette [Richmond], 16 Mch. 3. To "regulate commerce with foreign nations, and among the States, and with the Indian tribes." Article 1, Section 8, Clause 18. ‘to regulate commerce with foreign nations, and among the states, and with the Indian tribes.’ To erect a bank, and to regulate commerce, are very different acts. description ends , ii, 86–108; Malone, Jefferson, ii, 337–50; Brant, Madison, ii, 327–33; Schachner, Jefferson, i, 416–22; Miller, Hamilton description begins John C. Miller, Alexander Hamilton Portrait in Paradox, New York, 1959 description ends , p. 255–77; see also, Stuart Bruchey, “Alexander Hamilton and the State Banks, 1789 to 1795,” WMQ description begins William and Mary Quarterly, 1892- description ends , 3rd. The thing may be done, and has been done, and well done without this assumption; therefore it does not stand on that degree of necessity which can honestly justify it. To erect a bank, and to regulate commerce, are very different acts. 2. 4. Nothing but a necessity invincible by any other means, can justify such a prostitution of laws, which constitute the pillars of our whole system of jurisprudence. . Document 11. Perhaps indeed bank bills may be a more convenient vehicle than treasury orders. To transmit personal chattels to successors in a certain line and so far is against the laws of Distribution. 1 Opinions on the Constitutionality of a National Bank: 1791 There were only three banks in the entire country when Alexander Hamilton, in 1790, proposed the Bank of the United States to be modeled Though it is common to discuss Andrew Jackson’s opinion about a national bank, it is far less common to hear Thomas Jefferson’s version of things.Here, Jefferson lays out, systematically, his views on finance and the nature of a bank. This national bank proposal was fought against in congress by a group led by James Madison and Thomas Jefferson whose position was that the incorporation of the national bank was unconstitutional based on the powers granted to the United States government in the Constitution. 2. The bank became an important political issue in 1791, and for years to come. Besides, if this was an exercise of the power of regulating commerce, it would be void, as extending as much to the internal commerce of every State, as to its external. It must be added however, that unless the President’s mind on a view of every thing which is urged for and against this bill, is tolerably clear that it is unauthorised by the constitution, if the pro and the con hang so even as to balance his judgment, a just respect for the wisdom of the legislature would naturally decide the balance in favour of their opinion. Treasury orders then, and bills of exchange may prevent the displacement of the main mass of the money collected, without the aid of any bank; and where these fail, it cannot be prevented even with that aid. To form the subscribers into a corporation. The bill for establishing a National Bank undertakes, among other things. February 15, 1791. Washington's cabinet. 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. The Secretary of the Treasury having perused with attention the papers containing the opinions of the Secretary of State and Attorney General concerning the constitutionality of the bill for establishing a National Bank 6 proceeds according to the order of the President to submit the reasons which have induced him to entertain a different opinion. In addition, the chapter examines the related questions of whether a national bank was needed and whether the U.S. Constitution granted Congress the power to establish one. Thomas Jefferson: “Opinion on the Constitutionality of a National Bank” (1791) Commentary by Carey M. Roberts, Arkansas Tech University Log in to see the full document and commentary. Hamilton’s lengthy reply, written in one evening, supported the idea of implied powers granted by the Constitution. A national bank would materially help in performing these functions efficiently. Note: The annotations to this document, and any other In contrast to Hamilton, Jefferson believed that states should charter their own banks and that a national bank unfairly favored wealthy businessmen in urban areas over farmers in the country.
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