Federalist 31
The French philosopher René Descartes believed that knowledge resulted from “clear and distinct ideas” that occurred in the mind. He claimed there were certain ideas so present and so vivid that they did not allow of disputation. He especially emphasized “mathematical truths” such as 2+2=4 as beyond dispute. He proceeded from these foundations to build, deductively, the whole edifice of knowledge. If 2+2+4 is true, what must follow from that? What moral, political, and theological ideas could be justified if we could demonstrate they follow from those foundational ideas? Descartes believed he had discovered the solution to that question.
Alexander Hamilton does something similar in Federalist 31, arguing that certain mathematical and “scientific” ideas provided a ground for other ideas we have, including moral and political ones. Keep in mind this is the second essay he writes on the taxation power of government and its limits, but curiously he uses Cartesian foundationalism as his justification. His argument proceeds thusly:
Certain ideas contain “internal evidence” that command “the assent of the mind” such that only someone “disordered” would argue against them.
Geometry is the most obvious example of this. Parallel lines can never intersect. The angles of a triangle will always equal 180 degrees, and so forth.
There are moral and political ideas that are similarly indisputable. Effects follow from causes. Means ought to be proportioned to ends. “A power ought to be commensurate with its object.”
If one concedes that final maxim, then one must also concede that “there ought to be no limitation of a power destined to effect a purpose which is itself incapable of limitation.”
Providing for the common defense and the provisioning of a standing army are powers “to which no possible limits can be assigned,” dependent as they are on the “exigencies of the nation” as well as “the resources of the community.” In theory, this means all community resources could be fully employed toward defense.
Since the “exigencies of the nation” require an army powerful enough to face any possible situation, admitting of no limits, and taxation is “the essential engine” that makes the army go, then the taxation power must, by deduction, also be “comprehended in providing for those exigencies” that exist without limit.
The taxation authority must therefore not be limited.
Asking the states to provide tax revenues limits the power of the federal government in performing its legitimate tasks, so therefore the states should be taken out of the mix for funding the federal government.
Therefore the federal government must have the authority to tax citizens directly.
It takes a certain amount of ambitious genius to move from “2+2=4” to “government must be able to exercise an unlimited taxation authority over individual citizens,” but Hamilton displayed no small amount of virtuosity in such matters.
Hamilton’s syllogisms led to two natural concerns: 1) couldn’t bypassing the state’s taxation authority enable the federal government to render the states nugatory altogether? and, 2) what would an “unlimited taxation power” over individual citizens entail? These two questions resided at the heart of anti-federalist concerns about the taxation clause of Article 1, section 8, which read: The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States.
As I mentioned in the prior essay, the taxation power was seen as a “concurrent power,” one the states and federal government could both enact simultaneously. This created a system of double-taxation, which is why under the Articles of Confederation the federal government depended on the state governments for funding, their authority being prior to federal authority. What would happen, anti-federalists wondered, if both governments laid taxes so burdensome the people could not pay them? Would not then the federal government invoke the “necessary and proper clause” of Article I section 8 to suspend or restrain the state’s ability to raise its own funds? As Brutus argued in this 6th essay, if the state governments could only raise money by permission of the federal government then the federal government could get rid of state governments altogether simply by starving them of funds.
Hamilton regarded this as a canard. He argued that suspecting the federal government would overtake the state governments amounted to a “conjecture” by which the anti-federalists had put themselves “out of the reach of all reasoning,” bewildered as they were by “the labyrinths of an enchanted castle” that rendered them unable to “escape from the apparitions” they themselves had made. Fearful of their own ghosts, the anti-federalists paralyzed themselves and the nation with the specters of “an endless train of possible dangers” that existed only as ghouls and goblins in their own minds.
Rather, Hamilton argued, by virtue of the limited power given to the federal government by the Constitution, the union faced far more danger of negation from the states than the other way around. And just as the states exercised restraint in their own taxation power, so too could the federal government be counted on to exercise restraint in its use. The states being as likely to intrude on the federal government as the other way around, the only security was found in the affections and sentiments of the people who would always prefer the interest of their state over the interests of the union. In any case, he continued, “all conjectures of this kind must be extremely vague and fallible” and we should thus “lay them altogether aside.” The people alone would preserve the equilibrium.
Should the people have the means to do so, Brutus worried. The power to tax being a coercive power, the ability to bypass the will of the people by first subjugating them presented an ever-present difficulty. The power to tax was one thing, but that power carried with it the power to penalize those who didn’t pay, meaning that the courts and federal officers would have the ability to extract wealth on their terms. Granted, fear of a popular uprising would restrain the federal government for a while at least, but that government would move incrementally and eventually get to a point at which they no longer had any apprehensions about taxing, either in amounts or what they taxed.
Brutus provided his list of goods and activities likely to be taxed. Since Americans drank a lot of beer and cider, you could bet that government would not only tax its consumption but also its production, since it was easier to raise revenues from large producers than many small ones or – God forbid – home brewers. Every brewery would have to be licensed to make taxation as efficient and extractive as possible, so that the government could keep track of every ounce it could tax. Almost any consumer good could be subject to taxation and regulation. Brutus provided a chilling portrait of where this would all lead:
This power, exercised without limitation, will introduce itself into every corner of the city, and country-It will wait upon the ladies at their toilett, and will not leave them in any of their domestic concerns; it will accompany them to the ball, the play, and the assembly; it will go with them when they visit, and will, on all occasions, sit beside them in their carriages, nor will it desert them even at church; it will enter the house of every gentleman, watch over his cellar, wait upon his cook in the kitchen, follow the servants into the parlour, preside over the table, and note down all he eats or drinks; it will attend him to his bed-chamber, and watch him while he sleeps; it will take cognizance of the professional man in his office, or his study; it will watch the merchant in the counting-house, or in his store; it will follow the mechanic to his shop, and in his work, and will haunt him in his family, and in his bed; it will be a constant companion of the industrious farmer in all his labour, it will be with him in the house, and in the field, observe the toil of his hands, arid the sweat of his brow; it will penetrate into the most obscure cottage; and finally, it will light upon the head of every person in the United States. To all these different classes of people, and in all these circumstances, in which it will attend them, the language in which it will address them, will be GIVE! GIVE!
The federal government's power to tax would thus reach “every person in the community in every conceivable circumstance,” one consequence of which would be elevating the necessity of controlling the levers of taxation as a way of rewarding friends (by granting exceptions) and punishing enemies (a purpose to which presidents have used the IRS).
Brutus was impressed by the illogic of Hamilton’s position: no two parties could exercise unlimited power with regard to the same object, for the competition itself would provide a limit. He worried that the preamble’s references to “the common defense” and “general welfare” would prove vague and capacious enough to justify any imposition of a tax. Just as two parties cannot apply an unlimited power to the same object, so also one party opposing the Constitution and the other party supporting it could not be both committed to the general welfare in the same way. People in positions of power will always argue they are operating in for public good, and since no party could adjudicate a dispute between the rulers and the ruled, the rulers would always rule (in both senses) in their own interest.
Not willing to let an insult pass, Brutus commented on Hamilton’s tendency to regard those who disagreed with him as unduly prejudiced or driven by passion rather than reason. He regarded Hamilton as operating with too much of “an air of confidence” that not only insulted his opponents but also was not as reasonable as it pretended to be. A reminder that ad hominems are a perennial feature of political life. In any case, Brutus argued that Hamilton’s notions of the ends of government were far too ambitious as regards their ability to command revenue.
To say, ‘that the circumstances that endanger the safety of nations are infinite,’ and from hence to infer, that all the sources of revenue in the states should be yielded to the general government, is not conclusive reasoning: for the Congress are authorized only to controul in general concerns, and not regulate local and internal ones; and these are as essentially requisite to be provided for as those. The peace and happiness of a community is as intimately connected with the prudent direction of their domestic affairs, and the due administration of justice among themselves, as with a competent provision for their defence against foreign invaders, and indeed more so.
For that reason, Brutus believe, taxation power should rest primarily with the states, and also local governments, since those were the governments responsible for the issues that touched most closely upon people’s lives. A federal taxation power would make people less able to regulate their own lives and increasingly leave them in a state of dependency on people they didn’t know and who didn’t care for them. This was not the idea of a republic Brutus envisioned.
Director of the Ford Leadership Forum, Gerald R. Ford Presidential Foundation
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