What Is The Federal System Of Government?

Many people mistakenly equate “Federalism” with decentralization. A federal system is certainly a decentralized system but it is also much more. The defining characteristics of federalism are:

(i) Two constitutionally established, concurrent orders or levels of government, one consisting of fundamental units of governance (called “states”), the other consisting of a national government encompassing all the people who live in the states;

(ii) The sovereign people cede limited and specific powers to the national government, reserving respectively to their states the remainder of the powers they choose to delegate to government;

(iii) Each governing order or level of government is autonomous, free of the other to act within its own realm, the only exception being that acts of the national government are supreme to those of the states when those acts come into conflict in areas where both governments’ delegated authority overlap/intersect; and

(iv) The governments at each level are accountable to their respective electorates and in certain instances to each other as provided for in the constitution.

Before the term “states’ rights” became contaminated by its identification with the efforts of some states to perpetuate slavery and later racial segregation, “states’ rights” concisely described the states’ legal and political autonomy although the term always constituted a shorthand reference to states’ constitutional and political autonomy vis-à-vis the national government as opposed to natural rights, which only individuals possess.

What Was The Purpose Of The Federal System Of Government?

To protect the rights of individuals. The Founding Fathers distrusted power in the hands of any level of government, state or national. As Thomas Jefferson’s biographer Dumas Malone pointed out, Jefferson never supported states’ rights for their own sake, “but to safeguard the freedom of individuals,” which he, along with the rest of the Founding Generation believed would suffer in a consolidated nation no matter how decentralized the administration of the consolidated government happened to be.  Hence, in drafting the Kentucky Resolves for instance (see here and here), Jefferson identified the states as the primary depositories of power and the proper entities of resistance against an encroaching national government.

Although the Founding Fathers well understood that the federal form of government was no absolute bar against either state or national tyranny, they believed it to be a practical check on the national government (especially when combined with constitutional separation of powers) and at the same time a guarantee that safe havens would always exist to which people could flee from an oppressive state government. William Watkins, Jr. puts it this way: “Though some states might abuse power, Jefferson reasoned that not all would fall under the spell of tyranny.  But with a consolidated and abusive national government, all would suffer the same tyranny; there would be no islands of peace.”  (See The Kentucky and Virginia Resolutions)

How Was The Integrity Of The Federal System Of Government To Be Preserved?

Of all people, even the great Federalist consolidator and centralizer Alexander Hamilton understood the delicate balance in the basic architecture of the U.S. Constitution. According to Hamilton in Federalist # 28, it is an “axiom in our political system that the state governments will in all possible contingencies afford complete security against invasions of the public liberty by the national authority.”

Hamilton went on to postulate that should the national government pose a danger, the states could “at once adopt a regular plan of opposition, in which they can combine all the resources of the community. They can readily communicate with each other in the different states; and unite their common forces for the protection of their common liberty.” In other words, the primary means of defense against a grasping and encroaching national government was to be truculent state governments that took action singly and in concert to actively defy national government actions they considered to be in violation of the Constitution.

In a federal system, no government or branch of government was to be the judge of its own cause. (As John Taylor wrote much later, “a jurisdiction limited by its own will is an unlimited jurisdiction.”) The boundaries and limits of governmental authority were to be hammered out through a perpetual struggle among the separate branches of government and between the states and the national government. Watkins again succinctly states Jefferson’s and Madison’s understanding of how the boundaries of authority in a federal system were to be delineated:

“Jefferson proclaimed in the [Kentucky] resolution that ‘each party [to the federal compact] has an equal right to judge for itself, as well of infractions as of the mode and measures of redress.’ For Jefferson, the people acting through their states—the authentic organs of government—were the final arbiters of constitutional interpretation.  Jefferson feared that giving the federal government the exclusive power to interpret the Constitution through the Supreme Court would lead to arbitrary government.”

How Did The Federal System Of Government Fail?

Hamilton was correct in how the federal system of government was supposed to work but incorrect in how it actually worked out. Ironically, the cracks in federalism that appeared almost immediately after ratification of the Constitution were in large part due to the role Hamilton played as usurper in the early days of the American Republic, especially in the events surrounding the crisis of near war with France in the late 1790s. It was from these maneuverings that the hated Alien and Sedition Acts were enacted by the Congress, which led directly to the drafting of the Kentucky and Virginia Resolutions in 1798 by Thomas Jefferson and James Madison and what came to be known as the “Spirit of ’98.” The question then is how did Hamilton and his political progeny manage to overcome James Madison’s and Thomas Jefferson’s design and usurp the power of the states and abridge the rights of individuals contrary to the intention and careful design of the United States Constitution?

The American system of federalism has failed because the set of rules that established it and was meant to maintain it—the U.S. Constitution, its careful design notwithstanding—is fundamentally flawed. The Constitution failed to provide a practical mechanism to sustain and protect the autonomy of each order of government from encroachment by the other.

It is an interesting exercise to analyze why the U.S. Constitution failed in this, its most important function. (Read more. . .) However, it is not necessary to come to any definitive conclusion as to why it failed to know that is has, in fact, failed. It is sufficient to observe the states’ advanced stage of political decrepitude and legal dilapidation; the relatively low-quality of their elected and appointed officials; their incapacity to defend themselves legally, politically or physically against the national government; their fiscal dependence upon the national government; their reliance upon the national government operationally; their subservience to the national government in every respect; their low regard in the eyes of the public and the lesser affection and attention they receive from the electorate.

The Relentless Growth Of Government

Thomas Jefferson described the dynamic by which government grows and liberty recedes in a letter to Edward Carrington in 1788: “The natural progress of things is for liberty to yield and government to gain ground.” The design of the U.S. Constitution was meant to be a bulwark against this naturally corrosive process—a check against one level of government’s growth at the expense of the other to the ultimate detriment of the people—by giving one level of government a natural self-interest and the power and means to resist the expansion of its rival.

Government’s expansion at the expense of liberty is always fueled by the same poisonous admixture of human frailties: Fear, ignorance and greed. The mechanism of forward momentum that has propelled the excessive growth of government has always been the meshing of two gears: the natural inclination of politicians to gather more power unto themselves by oppressing the people and the natural inclination of people of business to maximize profits by gaining an advantage over their competitors. When profit-seeking business people work hand in glove with power-seeking politicians, both gain at the expense of the vast majority of the people. In general, government expands its power by scaring people and convincing them of the necessity of regulation, taxation and government spending to further the general welfare in the name of the public interest; while business enterprises seek to use the government’s expanding power to tax, spend and regulate to further their own ends.

The justification for government to expand its authority to tax, spend and regulate in the name of the public interest and for the “greater good” is based on a popular myth, namely that markets are everywhere and always fragile and failing and that government regulation is always benevolent, omniscient, and corrective. In fact, government regulation creates far more unintended problems that it solves. Moreover, government regulation almost always is a special-interest phenomenon driven by a combination of government’s quest for power and the quest of the firms being regulated to cartelize their industry in order to drive their competitors from the field so they can reap extraordinary profits at consumers’ expense. As Nobel Laureate George Stigler wrote in 1971, “As a rule, regulation is acquired by the industry and is designed and operated primarily for its benefit.”

There is an irresistible urge among businesses to create cartels but unaided by government oppression to destroy competition, cartels fall prey to companies’ unilaterally abandoning the rigged rules the cartel must enforce to survive—which is why the cartel must conspire with government to enforce the cartel’s rules by the force of law and regulation, imposing heavy fines and imprisonment for “cheating” and “law breaking.”

In the specific case of the national government’s eclipsing and subjugating the state governments, the dynamics of federalism’s decline has proceeded as follows: The national government has through artifice and flaws in the Constitution expanded its realm both by grasping new powers outside the Constitution’s grant of authority to either level of government and by expanding the area of authority common to both the states and the national government. If the general rule is that each order of government is sovereign within its own realm (Tenth Amendment) and the exception to that rule is the national government is supreme (Supremacy Clause) where those realms overlap/intersect and conflict, then the political growth strategy of the national government historically has been to constantly expand the area of overlap to permit the exception to swallow the rule.

The Slow-Motion Disintegration Of The Federal System Of Government.

The first test of federalism’s ability to protect the people against an over-reaching national government came early on in the face of a threat of war with France during the late 1790s. The Alien and Sedition Acts were enacted in direct response to the fear of war.

Jefferson and Madison perceived the danger of these acts, not only their immediate oppressive nature but also their long-run corrosive effect on the federal system of government. Jefferson described the Acts as “merely an experiment on the American mind, to see how far it will bear an avowed violation of the Constitution.” In response to this experiment in tyranny, Jefferson and Madison drafted the Kentucky and Virginia Resolutions in which they laid down the “principles of ‘98” in an effort to rouse the states to check an over-reaching national government before it became un-checkable. (Read more. . .)

The threat of an abusive national government’s over reaching its delegated powers receded temporarily as the threat of war receded, the war party of Hamilton lost power to the Republican Party of Jefferson and Madison and the Alien and Sedition Acts expired. This first test of federalism and the reaction to it in the form of the Kentucky and Virginia Resolutions have been downplayed in the nation’s official history yet this incident exposed the flaws in the design of American federalism and set the stage for the next attempted encroachment of national power

This second test of federalism and the concomitant expansion of the national government occurred around the fulcrum of the War Between the States. In addition to the unplanned expansion of government that invariably accompanies war, especially civil war, Abraham Lincoln and the Republican Party also set out intentionally to greatly strengthen and expand the power and scope of the national government through what became known as the “American System of Henry Clay,” a plan to use federal subsidies and high protectionist tariffs to establish economic nationalism and give large sums of tax dollars to corporations to build “internal improvements” – railways, waterways and canals.

As Reconstruction came to an end and throughout the remainder of the 19^thcentury and into the 20^th century, primarily under Republican rule, the skids to further centralization and consolidation were greased beginning in 1877 with the Supreme Court case of Munn v. Illinois. The Munn case illustrates how expansion of national power did not always appear to be such on its face. Indeed, as Munn illustrated, the predicate for the future expansion of national power could come first by a federal court ruling expanding state authority over individuals and businesses.

In fact, the most effective expansion of national authority came through a two-step process: First, expansion of overlapping powers (in this case the power to regulate commerce) followed by the national government’s claim of exclusive authority over the previously expanded common realm through the invocation of its constitutional supremacy (Supremacy Clause) in areas where state and national power intersect and conflict. Thus were states crowded from the field and hollowed out into mere shells of the authentic organs of government they previously were.

In Munn, The Supreme Court permitted states to regulate certain businesses within their borders, including railroads. This case is commonly considered a milestone in the growth of government regulation, practically eviscerating the bar against takings under state common law or the Contract Clause of the U.S. Constitution. The Court’s ruling upheld Illinois price-control legislation proposed by the National Grange to regulate grain elevator rates, declaring that business interests (private property) used for public good be regulated by government. This decision also affected similar laws governing railroad rates. Since they too were deemed private utilities serving the public interest, the laws governing their rates were held to be constitutional as well.

Although both holdings were considerably narrowed and weakened by the decision in Wabash, St. Louis & Pacific Railroad Company v. Illinois (also known as the Wabash Case), the predicate for further expansion of national commerce power had been firmly established. In Munn, the Supreme Court decided that the Fourteenth Amendment did not bar government from imposing price controls but focused instead on establishing the principle that a private company could be regulated in the public interest. The Court held that it could, if the private company could be seen as a utility operating in the public interest.

The Demise Of The Ninth And Tenth Amendments.

Once the primary constitutional bars to government (state or national) regulation of private entities were stripped away, it remained simply to expand the national government’s authority relative to the states and then to restrict the states’ authority to subjugate them to Washington, DC. The primary mechanism employed was an infinitely elastic Commerce Clause and promiscuous use of the Necessary and Proper Clause through which the national government’s power was inflated at the expense of state prerogatives, a process that ultimately pulverized the Ninth and Tenth Amendments under the national government’s boot. Jefferson clearly perceived the beginnings of this pernicious process and vigorously objected to it in the first Kentucky Resolution of 1798:

“. . .words [such as ‘necessary and proper’] meant by the instrument [Constitution] to be subsidiary only to the execution of limited powers, ought not to be so construed as themselves to give unlimited powers, nor a part to be so taken as to destroy the whole residue of that instrument.”

The expansion of the national government’s commerce power was not without temporary obstruction and even occasional temporary reversals but it was, over the course of time, unidirectional and virtually all encompassing. Between the turn of the 20^th century and the New Deal, the Supreme Court made a series of rulings that found congressional action in violation of the Tenth Amendment.  Perhaps the most famous are the 1918 ruling striking down national child labor standards (Hammer v. Dagenhart, 246 U.S. 20), in which the Court embellished the Tenth Amendment to read that powers not “‘expressly’ delegated to the national government are reserved,” the 1922Child Labor Tax Case (259 U.S. 20), and United States v. Butler (297 U.S. 1, 1936). 

Beginning in 1937, however, the Court reversed itself on restricting the powers of Congress under the Tenth Amendment.  In cases that year, such as National Labor Relations Board v. Jones and Laughlin Steel Co. (301 U.S. 1) andSteward Machine Co. v. Davis (301 U.S. 548), the Court found the Tenth Amendment to be of limited relevance in assessing the constitutionality of congressional taxing and spending policies. 

Although given several opportunities between 1937 and 1976, the Court refused to strike down national legislation on the grounds that it encroached on powers reserved to the states under the Tenth Amendment.  See e.g., New York v. United States (326 U.S. 572,1946) and Fry v. United States (421 U.S. 542, 1975).  In reference to the Commerce Clause specifically, on only eight occasions prior to 1937 did the Court find that the Congress had exceeded its constitutional limits. The last such case (prior to 1976) was Carter v. Carter Coal Co. (298 U.S.238, 1936), which invalidated the Bituminous Coal Conservation Act of 1935.  The Court held in that case that regulation of production and labor relations lay beyond the allowable object of congressional power—regulation of interstate commerce.  The Fair Labor Standards Act was upheld in United States v. Darby (312 U.S. 100, 1941), the Court holding that Congress may by law exclude goods that do not conform to specified labor standards from interstate commerce and may use direct regulation of labor relations to achieve this objective.

The Court temporarily rediscovered renewed state autonomy under the Tenth Amendment in National League of Cities v. Usery (1976). The Court found that the Tenth Amendment necessarily requires the existence of a set of essential state powers that remains beyond the reach of congressional regulation or preemption.  However, the Court was soon to begin chipping away any new expansion of states’ autonomy under National League of Cities. During the early 1980s, federal regulation of the states was upheld in a series of cases. See Hodel v. Virginia Surface Mining, 452 U.S. 264 (1981), United Transportation Union v. Long Island RR, 455 U.S. 678 (1982), FERC v. Mississippi, 456 U.S. 742 (1982), and EEOC v. Wyoming, 460 U.S. 226 (1983).

The Court finally threw in the towel and reversed itself altogether in Garcia v. San Antonio Metropolitan Transit Authority (1985), holding that the Tenth Amendment provides the Court no basis on which to limit the Congress in the exercise of its commerce powers. The Court declined, not simply to rule against the Congress, but even to entertain the possibility that the Congress might, within the scope of its commerce powers, intrude upon the constitutional position of the states.  The Court appeared finally to abandon whatever vestige remained of its role as federal umpire between the states and the federal government by refusing to blow the judicial-review whistle to signal a congressional foul.

In 1992, the Supreme Court appeared to breath life back into the Tenth Amendment by finding instances outside federal commerce power in which federal action might violate the reserved powers of the states. For the first time in 55 years, the Court invalidated one section of a federal law for violating the Tenth Amendment.  The case in question (New York v. United States, 505 U.S. 144) challenged a portion of the Low-Level Radioactive Waste Policy Amendments Act of 1985.  The Act established three mechanisms to entice/compel states to comply with federal statutory obligations to provide for the disposal of low-level radioactive waste.  The first two enticements were monetary incentives. The third, which was challenged in the case, required states to take title to any waste within their borders that was not disposed of prior to January 1, 1996. The Act also made each state liable for all damages directly related to the waste.  The Court, in a 6–3 decision, ruled that the imposition of that obligation on the states violated the Tenth Amendment.

Justice O’Connor wrote the opinion of the Court, which held that the Congress may use its spending powers to encourage the states to adopt certain regulations (i.e., by attaching conditions to the receipt of federal funds, seeSouth Dakota v. Dole, 1987) or impose its will through the commerce power (by directly pre-empting state law).  However, Congress may not directly compel states to enforce federal regulations.

In 1997, the Court went a step further in its apparent revitalization of Federalism when it ruled that the Brady Handgun Violence Prevention Act violated the Tenth Amendment (Printz v. United States, 521 U.S. 898).  The Act required state and local law enforcement officials to conduct background checks on persons attempting to purchase handguns.  Justice Scalia, writing for the majority, applied New York v. United States in holding the law violated the Tenth Amendment.  Because the act “forced participation of the State’s executive in the actual administration of a federal program,” the Court found it to be unconstitutional.

Less than a decade later, however, the Court again expanded its elastic definition of “commerce among the states” to include local cultivation and consumption of marijuana (Alberto R. Gonzales, Attorney General, et al, v. Angel McClary Raich, et al.) In the process, the Court tightly constricted the life support it had provided the Tenth Amendment and, in effect, restricted its protections exclusively to a prohibition against federal commandeering of state governments to enforce federal laws and regulations through direct edict. With the Gonzales v. Raich decision, the Court again found it impossible to declare federal laws unconstitutional for violating the Tenth Amendment because it refused to circumscribe federal authority under the Commerce Clause.

Justice Clarence Thomas disputed the Court’s further expansion of federal commerce power:

“Respondents Diane Monson and Angel Raich use marijuana that has never been bought or sold, that has never crossed state lines, and that has had no demonstrable effect on the national market for marijuana. If Congress can regulate this under the Commerce Clause, then it can regulate virtually anything–and the Federal Government is no longer one of limited and enumerated powers.”

Expounding upon what this expansive interpretation of “commerce among the several states” means for the Tenth Amendment, Thomas spotlighted the state of limbo in which the Court remains stuck on Federalism:

“One searches the Court’s opinion in vain for any hint of what aspect of American life is reserved to the States. Yet this Court knows that ‘“[t]he Constitution created a Federal Government of limited powers.”’ New York v. United States, 505 U.S. 144, 155 (1992) (quoting Gregory v. Ashcroft, 501 U.S. 452, 457 (1991)). That is why today’s decision will add no measure of stability to our Commerce Clause jurisprudence: This Court is willing neither to enforce limits on federal power, nor to declare the Tenth Amendment a dead letter. If stability is possible, it is only by discarding the stand-alone substantial effects test and revisiting our definition of ‘Commerce among the several States.’ Congress may regulate interstate commerce–not things that affect it, even when summed together, unless truly ‘necessary and proper’ to regulating interstate commerce.”

The range of federal power is circumscribed by the boundaries established by the enumerated powers; but the enumerated powers themselves are restricted only to the extent that the definition of “commerce among the several states” is limited, which for all intents and purposes the Court appears unwilling to limit. Therefore, at the end of the first decade of the 21^st century, the limits of federal authority vis-à-vis the states has boiled down to a narrow restriction against the federal government’s commandeering or compelling the states to enforce federal statutes.

1913 Was A Very Bad Year

Concurrently with employing the Commerce Clause and Necessary and Proper Clause to fuel the expansion of the national government at the expense of the states, the national government also aggressively used its fiscal and monetary powers to aggrandize itself throughout the first half of the 20^th century. Of all the government-sanctioned cartels, the most pernicious has been the Federal Reserve System, established in 1913, which was created to facilitate the creation of a banking-industry cartel and the creation of cartel profits in that industry as well.  As Murray Rothbard wrote in A History of Money and Banking in the United States, “The financial elites of this country . . . were responsible for putting through the Federal Reserve System, as a governmentally created and sanctioned cartel device to enable the nation’s banks to inflate the money supply . . . without suffering quick retribution from depositors or note holders demanding cash.”

Additionally in 1913, the national government finally succeeded in enacting an income tax on individuals, which provided not only an unprecedented source of revenue for the national government but also evolved into a general, all-purpose engine of income and wealth redistribution, government monitoring and surveillance of individuals as well as a mechanism of direct control of individual behavior and social engineering.

Finally, the direct election of Senators, also in 1913, was perhaps the single biggest step away from federalism and the original constitutional design toward mass democracy and a consolidated national government. With the Tenth Amendment well on its way to becoming a dead constitutional letter, with an open-ended Commerce Clause in place to fuel unlimited growth of the national government’s reach, with a revenue-generating and behavior-regulating national income tax in place, and hard currency now able to be replaced by freely printed paper money at the Fed, direct election of Senators completed the necessary and sufficient conditions for a complete consolidation of political power in the hands of a unified national government.

Intergovernmentalism Replaces Federalism

After World War II, federalism was replaced by “intergovernmentalism,” an unlovely term for the unlovely transformation of the sovereign states into bureaucratic extensions of the central government. It happened this way.

The national government further expanded its control over state governments through the fiscal realm by a series of “revenue-sharing” measures, beginning with specific grants-in-aid eventually including huge national entitlement programs such as Medicaid, which entice and require state fiscal participation through direct mandates and statutory fiscal matching provisions. Along with the grant of money came federal mandates on the states, which provided the national government a lever to control and direct state behavior to comport to the desires of Washington. The ultimate fiscal hold on states developed during the Cold War through the expansion of the military-industrial complex, which thoroughly entangled the economic circumstances of the states with defense contractors and the perpetuation of the national war machine.

By 1985, with the Court’s ruling in Garcia, federalism was dead, and state sovereignty was a mere constitutional echo of days past.

Can Federalism And State Sovereignty Be Revived?

Beginning on September 11, 2001, the expansion and consolidation of the national government took another quantitative and qualitative leap forward, this time toward World Empire. As the United States approaches the end of the first decade of the 21^st century and the 220^th year of the American constitutional republic, an unrestrained, largely unlimited national government routinely ignores precious individual rights once held inviolate under the U.S. Constitution, regularly tramples on states’ prerogatives, pursues total information awareness of every detail of individuals’ lives, seeks total behavior control of American citizens and asserts the right to exert its power without the sanction of a declaration of war or legal warrant into any country against any individual anytime, anyplace in the world.

Fear, ignorance and greed, when fueled and manipulated by propaganda reduce people’s natural immune responses to oppressive and parasitic government, allowing politicians to sap their essence and abandon the principles on which their liberty is based. This process by which government grows at the expense of liberty has been the same since the English King and his Parliament oppressed American colonialists. The authors of the Declaration of Independence described the process vividly: “He Erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.”

So also has Washington, DC erected a multitude of federal programs and taxes, complete with huge bureaucracies and police forces, and sent hither into the states and local communities bureaucrats, revenue agents, police and military personnel to harass the people and eat out their substance. Thus has Federalism failed, state sovereignty been destroyed and liberty eclipsed.

William Watkins summarizes the architectural imperative on which the U.S. Constitution rests:  “Power can be checked only by power. The [Kentucky and Virginia] Resolves point to the states as the natural depository of power to check the national government. . .If the American people are once again to gain control of the national government, it will be through the states.”

But, it won’t be simply a matter of untying the knot or walking this cat back. It is impossible to simply retrace the steps that brought the American political system to its present perilous situation; it will require courage, steadfastness, truculence, defiance and a will of iron to stand up to Washington and stand down the power of the federal government. It will be an undertaking not in principle different from but even more daunting and difficult than the Civil Rights Movement, namely reviving America and restoring liberty by overcoming oppressive government that is acting illegally and immorally with a pointed gun under the color of law.

Dr. Lawrence A. Hunter is President of the Social Security Institute, a 501(c)(4) non-profit organization, and Senior Fellow at Americans for Prosperity and the Institute for Policy Innovation where he does economic research and writes reports on a diverse range of public policy issues.

The American Revolution was waged against a highly centralized, nationalistic governmental tyranny run by a king, namely, the British Empire. The king enriched himself and his regime through the economic institution of mercantilism, defined by Murray Rothbard as “a system of statism which employed economic fallacy to build up a structure of imperial state power, as well as special subsidy and monopolistic privilege to individuals or groups favored by the state.” This system impoverished the average Englishman but was a perpetual source of power and riches for the king and his political allies. That is why the system lasted so long (at least two centuries) despite the fact that it was so harmful to the average citizen.

After the Seven Years War with France the king of England needed to pay off his war debts, so he stepped up the application of the corrupt mercantilist system to the American colonists. He did so with numerous taxes and interferences with international trade that benefited British businesses and the British state while treating the colonists like tax serfs. The “train of abuses” delineated in the Declaration of Independence were mostly abuses of the colonists for the purpose of plundering them with the British mercantilist system.

There was always a group of men in American politics who were not opposed to the evil mercantilist system in principle. They recognized it as a wonderful system for accumulating power and wealth as long as they could be in charge of it. Being victimized by it was another matter. These men, led by Alexander Hamilton and his fellow Federalists, strived to implement an American version of British mercantilism as soon as the Revolution was over. In doing so they were traitors to the American Revolution and the worst kind of corrupt, power-seeking political scoundrels.

America’s would-be economic dictators strived mightily to “justify” their corrupt scheme by rewriting the history of the American founding. They made the bizarre argument that, having just fought a revolution against a highly centralized tyranny, the founders at the constitutional convention supposedly embraced the same kind of tyranny in the form of a highly centralized or national government.

The Virginia statesman John Taylor of Caroline smoked out these political scoundrels in an 1823 book entitled New Views of the Constitution of the United States (reprinted in 2005 by The Lawbook Exchange, Ltd, of Union, New Jersey). Making extensive use of the recently published Secret Proceedings and Debates of the Constitutional Convention by Robert Yates, who attended the constitutional convention, Taylor shredded the false notions of “nationalists” like Hamilton (and later, Clay and Lincoln).

Focusing on Hamilton as the chief culprit, Taylor explained how the “nationalists” did try at the constitutional convention to create a completely centralized government, but failed. For example, he quotes Hamilton himself at the convention as proposing a form of government such that “All laws of the particular states, contrary to the constitution or laws of the United States [government], to be utterly void. And the better to prevent such laws being passed, the governor . . . of each state shall be appointed by the general government, and shall have a negative upon the laws about to be passed in the state of which he is governor.”

Hamilton’s scheme was rejected, of course, and Taylor correctly commented that “this project comprised a national government, nearly conforming to that of England . . .” (p. 27). “By Colonel Hamilton’s project, the states were fairly and openly to be restored to the rank of provinces, and to be made as dependent upon a supreme national government, as they had been upon a supreme British government” (p. 28). Moreover, under Hamilton’s scheme “A power in the supreme federal court to declare all state laws and judgments void” would be “a supremacy exactly the same with that exercised by the British king and his council over the same provincial departments” (p. 28). Thankfully, Hamilton’s plan was rejected.

Quoting Yates’s journal, Taylor also noted that on June 25, 1787 “it was proposed and seconded to erase the word national, and substitute the words United States [in the plural] in the fourth resolution, which passed in the affirmative” (p. 29). “Thus,” Taylor wrote, “we see an opinion expressed at the convention, that the phrase “United States” did not mean ‘a consolidated American people or nation,’ and all the inferences in favour of a national government . . . are overthrown” (p. 29).

Taylor understood that the reason why Hamilton and other Federalists wanted a centralized or consolidated government was that states’ rights would forever stand in the way of their accumulation of power and wealth through the mercantilist system that they hoped to impose on America. Therefore, states’ rights must be crushed, in the eyes of Hamilton and his followers (despite occasional lip service paid to the notion of states’ rights).

Relying again on Yates’s notes, Taylor wrote of how the Hamiltonians proposed to empower the Congress to engage in a variety of economic interventions, including “the promotion of agriculture, commerce, and manufactures” (p. 29). A “monopoly in currency” by the central government was another of Hamilton’s schemes that alarmed the senator from Virginia. This was their plan for bringing British mercantilism to America: First, consolidate political power in the central government and destroy any semblance of divided sovereignty; then, use that power to replicate the mercantilist British monarchy hidden behind the rhetorical fog of American “democracy.” As Taylor described it, it was “Monarchy, its hand-maiden consolidation, and its other hand-maid, ambition, all dressed in popular disguises . . .” (p. 45). And, “National splendor, national strength, and a national government, were the arguments they [the Hamiltonians] used; but personal considerations, suggested by the prominence of their stations, or the hopes suggested by their talents, really forged their opinions” (p. 46). The “pretended national prosperity, was only a pretext of ambition and monopoly . . . intended to feed avarice, gratify ambition, and make one portion of the nation tributary to another” (p. 46).

But the nationalists failed in their endeavor; the Constitution created a confederacy of states that delegated only a few enumerated powers to the central government, which was to act as their agent, and for their benefit. All other powers were reserved to the people or the states. It was a federal, not a “national” government. Subsequently, “Colonel Hamilton . . . seems to have quitted the convention in despair, soon after the failure of his project” (p. 32).

Yates’s notes on the convention prove definitively that “the whole people” never had anything whatsoever to do with the ratification of the Constitution, which was done by state conventions. There was never any national election that created a national government. As his journal states, quoted by Taylor (p. 32): “that the constitution was transmitted to Congress, and by it to the state legislatures; that these legislatures, by separate laws, appointed state conventions for the consideration of the constitution; and that it was ratified by the delegates of the people of each state.”

Thus, “every step in its progress,” writes Taylor, “from beginning to end, defines [the Constitution] to be a federal and not a national act. . . . It was ratified by each state, because each state was sovereign and independent” (p. 32, emphasis added). Furthermore, “no negative upon state laws was delegated to the federal government, or any department thereof, and the absence of such a power had been enforced by its rejection.”

What motivated Taylor to write New Views of the Constitution of the United States was the alarming fact that, by the 1820s, the men in American politics who still dreamed of reigning over a mercantilist empire began mis-educating the public about the true history of the founding. They did so by repeating Hamilton’s arguments, which were so thoroughly rejected by the convention. As Taylor described it, the public was being told that “the devil, thus repeatedly exorcized, still remains in the church” (p. 36). The “devil,” of course, was the notion that the states were not sovereign over the central government that they had created as their agent. The truth, as Taylor explained, was that “by the constitution, the states may take away all the powers of the federal government, whilst that government is prohibited from taking away a single power reserved to the states” (p. 36).

It was assumed that state sovereignty included a right of secession from the constitutional compact. “In the creation of the federal government, the states exercised the highest act of sovereignty, and they may, if they please, repeat the proof of their sovereignty, by its annihilation” (p. 37). The states “could never have conceived that they had, by their union, relinquished their sovereignties; created a supreme negative power over their laws; or established a national government . . .” (p. 37). In fact, according to Yates’s journal, the states were described at the convention as essentially being independent nations. So much so that the journal stated: “It may safely be received as an axiom in our political system, that the state governments will, in all possible contingencies, afford complete security against invasions of the publick liberty by the national authority” (Taylor, p. 70, emphasis added).

Yates’s journal further states: “Each state, in ratifying the constitution, is considered to be a sovereign body independent of all others, and only to be bound by its own voluntary act. In this relation, then, the new constitution will be a federal and not a national constitution” (Taylor, p. 83). This means that any one state would have the right to secede from the constitutional compact. It would have been considered an absurdity to argue that the right of secession only existed by the permission of other states (which was Lincoln’s argument).

But why all the secrecy? Why did the framers of the constitution take an oath not to reveal to the public what they were up to until after they were all dead? (Madison’s notes were not published until after his death). In a recent LRC article entitled “The Most Successful Fraud in American History” Gary North suggested that “the perpetrators [of any fraud] must be bound by an oath of non-disclosure, which all of them keep until they die, yet which leaves no trail of paper for historians to discuss.” John Taylor would agree. It was all kept secret so that “the vindicators of a federal construction of the constitution are deprived of a great mass of light, and the consolidating school have gotten rid of a great mass of detection” (p. 41). Thus, “it was necessary to keep the people in the dark” so that “the people should be worked as puppets” (p. 41).

Taylor also dissects and ridicules the “paradoxical arguments” of the Hamiltonians of his day (who would soon form the Whig Party of Henry Clay and Abraham Lincoln). The advocates of “consolidated sovereignties,” Taylor noted, contend that

The greater the [government] revenue the richer are the people; that frugality in the government is an evil; in the people a good; that local partialities are blessings; that monopolies and exclusive privileges are general welfare; that a division of sovereignty will raise up a class of wicked, intriguing, self-interested politicians in the states; and that human nature will be cleansed of these propensities by a sovereignty consolidated in one government.

Taylor was being excessively polite when he labeled these absurdities as merely “paradoxical.”

Taylor also provides a clear explanation of the so-called “supremacy clause” of the Constitution, which many contemporary commentators (especially Lincoln worshipping neocons) insist gives the federal government the power to do whatever it wants to the citizens of the states. The truth is that the language in the Constitution about it being “the supreme law of the land” only applies to the seventeen specific powers enumerated to the central government in Article I, Section 8. Nothing more. The states remain the ultimate sovereigns by the Constitution. “The constitutional laws of the states are equally supreme with those of the federal government” (p. 78).

John Taylor issued his warning that “the devil is in the church” in 1823. In the coming years the new generation of “consolidationists,” led by the likes of Daniel Webster and Henry Clay, were hard at work repeating Hamilton’s “paradoxical” arguments in the apparent belief that a gullible public would come to believe such arguments if they are repeated enough. They never achieved much success, however, thanks to the strength of the Jeffersonian, states’ rights tradition in America, which was the nation’s true political tradition.

The Constitution was essentially a failed attempt to overthrow the decentralized, federalist system that was created by America’s first Constitution, the Articles of Confederation. The delegates to the constitutional convention were only instructed to revise the Articles, not replace them. The first thing they did was to ignore the instructions they were given and write an entirely new constitution. But as Yates’s journal and Taylor’s book reveal, they failed. They only managed to get the citizens of the states to delegate a few enumerated powers to the central government, not to create a national government. They succeeded in replacing the Articles, but not with their ideal, monopolistic system.

It would require a brutal, uncompromising dictator to overthrow the federal system and adopt a British-style consolidated, mercantilist empire. As Taylor wrote (p. 237): “It seems to be nature’s law, that every species of concentrated sovereignty over extensive territories, whether monarchical, aristocratical, democratical, or mixed, must be despotick. In no case has a concentrated power over great territories been sustained, except by mercenary armies; and whenever power is thus sustained, despotism is the consequence.” Furthermore, “the ignorance and partiality of a concentrated form of government, can only be enforced by armies; and the peculiar ability of the states to resist, promises that resistance would be violent; so that a national government must be either precarious or despotick” (p. 238).

Yates’s notes quote James Madison as warning at the constitutional convention that “the great danger to our federal government, is the great northern and southern interests of the continent being opposed to each other” (Taylor, p. 248). Taylor quotes Madison to predict the War for Southern Independence, which would occur almost four decades later. If northern, southern, or western interests are in sharp conflict, he wrote, and “if either can acquire local advantages from a national supremacy, it will aggravate the geographical danger apprehended by a Mr. Madison, a perpetual warfare of intrigues will ensue, and a dissolution of the union will result” (p. 249).

This is where the role of the brutal, uncompromising dictator enters into American political history. The crusade for a consolidated, monopolistic government began as soon as the Revolution ended. Some seventy-five years later Taylor’s worst fear was realized: a consolidated, mercantilist empire was finally cemented into place, and it did require “a mercenary army” to succeed. Lincoln’s army included literally hundreds of thousands of conscripts and European mercenaries who finally snuffed out the Jeffersonian, federalist system of states’ rights with the bloodiest war in human history up to that point.

The New England Yankees and their Midwestern brethren continued to rewrite history in the ensuing decades so that books like Robert Yates’s journal of the constitutional convention and John Taylor’s book on the Constitution are virtually unheard of in America. The whitewash of American history has been very thorough indeed.

Thomas J. DiLorenzo [send him mail] is professor of economics at Loyola College in Maryland and the author of The Real Lincoln; Lincoln Unmasked: What You’re Not Supposed To Know about Dishonest Abe andHow Capitalism Saved America. His latest book is Hamilton’s Curse: How Jefferson’s Archenemy Betrayed the American Revolution – And What It Means for America Today.

Copyright © 2006 LewRockwell.com

Thomas Woods in the third in a series of ten lectures, presented at “The Truth About American History: An Austro-Jeffersonian Perspective” seminar, hosted by the Mises Institute. Recorded 06/21/2005.

Part 1.  Part 2.

The federal government today can wage wars without the consent of our congressional representatives, overthrow foreign governments, tax nearly half of national income, abolish civil liberty in the name of “homeland security” and “the war on drugs,” legalize and endorse infanticide (”partial-birth abortion”), regulate nearly every aspect of our existence, and there’s little or nothing we can do about it. “Write your congressman” is the refrain of the slave to the state who doesn’t even realize he’s a slave (thanks to decades of government school brainwashing).

But Americans were not always slaves to federal tyranny. Perhaps the best illustration of this is how Americans once utilized the Jeffersonian, states’ rights traditions of nullification and interposition to assist President Andrew Jackson in his campaign to veto the re-chartering of the Second Bank of the United States (BUS) in 1832. Jackson essentially ended central banking in America until it was revived thirty years later by the Lincoln administration. The story is told in James J. Kilpatrick’s wonderful 1957 book, The Sovereign States: Notes of a Citizen of Virginia.

The Bank was notorious for fraud, mismanagement, corruption, and attempts to engineer a “political business cycle.” Prior to 1861, the American people were still sovereign over their government. They exercised that sovereignty in the way the founders intended: through state political conventions or legislatures. The federal government was their agent.

Consequently, as early as 1816, Indiana and Illinois amended their state constitutions to prohibit the BUS from establishing branches within their jurisdictions. North Carolina, Georgia, and Maryland imposed heavy taxes on BUS branches within their states in attempts to tax them out of existence (A tax that even libertarians could love!). Knowing that such taxes could destroy the central bank, the federal government brought suit in Maryland (McCulloch vs. Maryland), confident that John Marshall, chief justice of the Supreme Court and a proponent of the BUS, would rule in its favor. He did, coining the famous phrase that “the power to tax involves the power to destroy” in his decision. He wasn’t expressing a fear that taxation could destroy private initiative and private enterprise, but that it could limit the federal government’s monetary monopoly.

Despite Marshall’s opinion that state taxes on the BUS were unconstitutional, numerous states continued to harass the bank. Until 1865, the Supreme Court’s opinion was just the Supreme Court’s opinion. The citizens of the states reserved the right to offer their own opinions on constitutionality, which they often considered to be every bit as valid as the Court’s. The same was true of certain presidents: Andrew Jackson essentially said “thank you for your opinion” and then thumbed his nose at the Court when it ruled that the BUS was constitutional.

After Marshall’s 1819 opinion, Ohio enacted a $50,000 per year tax on the BUS. The Bank refused to pay, so the Ohio state auditor ordered a deputy, one John L. Harper, to collect the tax. As Kilpatrick (p. 151) explains it:

[O]n the morning of September 17, Harper made one last request for voluntary payment. When this was denied, he leaped over the counter, strode into the bank vaults, and helped himself to $100,000 in paper and specie. He then turned this over to a deputy . . . stuffing this considerable hoard into a small trunk, with which the party thoughtfully had come equipped . . .

This would be the equivalent of today’s governor of Ohio ordering state troopers to enter the Cleveland Fed and strip its vaults of over a million dollars. The BUS sued Ohio, relying on Marshall’s opinion. The Ohio legislature considered such a lawsuit to be a threat to citizen sovereignty and a dangerous precedent to all Americans, not just Ohioans. It issued a statement saying, “To acquiesce in such an encroachment upon the privileges and authority of the States, without an effort to defend them, would be an act of treachery to the State itself, and to all the States that compose the American Union (emphasis added).”

The legislature stated that it was aware of the theory that the Supreme Court is to be the interpreter of the Constitution, but declared that “to this doctrine . . . they can never give their assent” (Kilpatrick, p. 152). The legislature quoted Jefferson’s Kentucky Resolve of 1798, which said that “as in all other cases of compact among parties having no common judge,” each party “has an equal right to interpret the Constitution for themselves, where their sovereign rights are involved . . .”

Marshall was wrong, the Ohioans said, because his opinion unconstitutionally encroached upon the sovereignty of the states. Therefore, they were under no obligation to acquiesce in his ruling.

The Ohio legislature promised to return the $100,000 if the BUS left the state. If not, it proposed a law forbidding “the keepers of our jails” from imprisoning any person “committed at the suit of the Bank of the United States”; prohibiting Ohio courts from “taking acknowledgements of conveyance where the Bank is a party”; and forbidding “our courts, justices of peace, judges and grand juries from taking any cognizance of any wrong alleged to have been committed upon any species of property owned by the Bank.” Invoking Jefferson’s “Doctrine of ’98,” the Ohioans concluded by “denouncing the Federal courts for violation of the Constitution” (p. 154).

The BUS persisted in its lawsuit, and eventually had the state treasurer arrested and imprisoned. While in prison, the keys to the state vaults were physically taken from him and the feds took back the $100,000, apparently still in the same trunk.

This act infuriated the Ohioans even more, and they continued to harass the Bank, as did many other states. Kentucky and Connecticut adopted Ohio’s states’ rights stand toward the Bank in 1825. In 1829, South Carolina imposed a tax on stockholders of the Bank within the state. New York and New Hampshire enacted resolutions urging that the Bank not be re-chartered. As Kilpatrick concludes:

In the face of this unrelenting warfare, the bank could not survive. Withdrawal of the public deposits began in August of 1833, under Jackson’s order; and when Pennsylvania governor Wolf, who had been one of the bank’s staunchest supporters, denounced the institution in . . . March of 1834, public opinion was fatally influenced against the bank. The Pennsylvania Senate adopted fresh resolutions urging that the bank ought not to be re-chartered. The following month, the United States House of Representatives adopted the same view, and the bank’s days came to an end (p. 157).

Andrew Jackson is usually given credit for (temporarily) ending central banking in America in the nineteenth century. But he had help. It was this expression of citizen sovereignty, in the spirit of the Jeffersonian states’ rights tradition, that made Jackson’s veto of the bank politically possible.

States’ rights as a check on the tyrannical proclivities of the central government ended in 1865, of course. As Forrest McDonald noted in States’ Rights and the Union (p. 224), after Lincoln’s war the Supreme Court “became the sole and final arbiter of constitutional controversies. No longer could a Jefferson arise to insist that the other branches of the federal government had coequal authority to determine constitutionality. No more could a Calhoun arise to defend a doctrine of interposition or nullification.”

The imperious Woodrow Wilson would celebrate this fact in his 1908 book, Constitutional Government in the United States, where he wrote (p. 178) that “the War between the States established . . . this principle, that the federal government is, through its courts, the final judge of its own powers.”

In A View of the Constitution, published a century earlier, the Jeffersonian legal scholar St. George Tucker cited this phenomenon as the very definition of tyranny. If the federal government ever became the final judge of the limits of its own powers, Tucker warned, then constitutional liberty would become an empty phrase. The federal government would inevitably conclude that there are, in fact, no limits to its power.

Thomas J. DiLorenzo is professor of economics at Loyola College in Maryland and the author of The Real Lincoln; Lincoln Unmasked: What You’re Not Supposed To Know about Dishonest Abe and How Capitalism Saved America. His latest book is Hamilton’s Curse: How Jefferson’s Archenemy Betrayed the American Revolution – And What It Means for America Today.

Note: This article was originally published on May 9, 2003

Copyright © 2003 LewRockwell.com  Permission to reprint in whole or in part is gladly granted, provided full credit is given.

“The people who lost”: Bill Kauffman uses this quote from historian William Appleman Williams to begin his book, Forgotten Founder Drunken Prophet, on the Anti-Federalists – those who opposed the ratification of the current U. S. Constitution during and after the Constitutional Convention of 1787.

Most of the state delegations at Philadelphia were populated by Federalists –men dedicated chiefly to strengthening the power of the federal government. To this class belonged the famous men of our history: e. g., Alexander Hamilton, George Washington, Gouverneur Morris, James Madison (a surprise to me to find him in this camp).

The Anti-Federalists were lesser known mostly: Melancton Smith, John Lansing, Luther Martin (the main subject of Kauffman’s aforementioned book – Forgotten Founder, Drunken Prophet). They were more modest in their goals at the Convention, wanting only to reform the existing Articles of Confederation rather than toss them aside and build the federal government anew as the Federalists desired, and wishing to preserve state and local authority.

The Federalists were not shy in their disdain for the states at the Convention. In order to establish a strong national government, the states “ought to be extinguished, new modified, or reduced to a smaller scale,” opined Alexander Hamilton. “State attachments and State importance have been the bane of this country,” Gouverneur Morris added.

The Virginia Plan written by Madison (the document upon which our present Constitution is based) eliminated the equal representation of the states as then existed under the Articles, and he was insistent that the national legislature be able to veto laws of the state legislatures that it thought were opposed to the “general interest” of the country.

The Anti-Federalists were having none of it. Thanks to their efforts Madison’s national veto was scrapped; the Virginia Plan was modified to include equal representation of the states in the Senate; the Senate was given the power to approve appointments by the president; and after the Convention they were successful in adding the Bill of Rights.

These were significant victories, but the Anti-Federalists were unsuccessful in other attempts to improve the new federal government of the Constitution. All of their ideas cannot be presented here, but a few of the more important ones appear below.

In the Senate they were unable to preserve the provisions in the Articles that would have required annual elections of U. S. senators by the state legislatures (with the power to recall any senator at any time), pay for senators by their states rather than the federal government, or senators voting together as one state delegation rather than as separate individuals.

In the U. S. House of Representatives they sought “short terms of office” and “frequent rotation” out of office for members. Only the first was achieved. Their attempts to secure substantial numbers of middle class representatives in the House through a “numerous representation” were also thwarted, making way for the aristocratic domination of that chamber. (Herbert Storing, What the Anti-Federalists Were For)

They did not prevail in replacing the overly powerful president with plural executives.

They failed to further safeguard the authority of the states by giving them more control over their own militias, limiting the taxing power of the federal government, or requiring a supermajority to approve federal measures regulating commerce between the states and between the U. S. and foreign countries.

Martin was not optimistic about the Constitution that resulted from the deliberations in Philadelphia. The federal government would break free from the few restraints placed upon it, he thought.

Fellow Anti-Federalist George Clinton agreed: Nothing would be left to the states but to “meet once in a year to make laws for regulating the height of your fences and the repairing of your roads.”

They have been proven right. Indeed, Kauffman concludes, many of the federal government’s objectionable actions “are not so much unconstitutional as they are logical extensions of the consolidationist thought of Madison, Wilson, Morris, and the nationalist faction that triumphed at Philadelphia.”

The U. S. Constitution is not without its beneficial features. Neither were the Federalists without virtue or wisdom. But this Constitution Day and afterwards, spend some time becoming acquainted with Anti-Federalist thought. Our country needs its revival now more than ever.

Luther Martin asks for a final word, and he shall have it: “Happiness is preferable to the Splendors of a national Government.”

Walt Garlington is founder of the Louisiana State Sovereignty Committee

From Chuck Baldwin: Note: My son, Tim, writes today’s column. He is an attorney who received his Juris Doctor degree from Cumberland School of Law in Birmingham, Alabama. He is a former prosecutor for the Florida State Attorney’s Office and now owns his own private law practice. He is author of a new book, published soon by Agrapha Publishing, entitled FREEDOM FOR A CHANGE

The arguments against the power of the states to arrest federal tyranny are as predictable as the sun coming up in the morning, and they are as philosophical in nature as the Declaration of Independence. One of the most commonly used arguments against such a State power is the United States Supreme Court (US S CT) dicta opinion in Marbury v. Madison in 1803, written by Chief Justice John Marshall. Before getting into the misunderstandings and misapplications of that infamous decision, we must first recognize the source and character of Marshall’s opinion. As Marshall himself admitted that the US is to be a country of “laws, not men,” we must establish that Marshall’s opinion does not equate to the “supreme law of the land” which the states and individuals are bound to obey. If our submission only requires that the US S CT speak, then we do not live as freemen, but as slaves.

Marshall was an ardent member of the Federalist Party (a pro-centralist party) and served as the Secretary of State in the pro-centralist administration of President John Adams, who appointed Marshall to the US S CT in 1801 at the “midnight” hour before Thomas Jefferson was sworn into office as President of the US. Marshall’s nationalist opinions were no secret either. Marshall believed that the US Constitution and Union were formed by the aggregate whole of the American people, and not by a compact of the states; that the Union formed “one nation, indivisible” and not a confederation of states; that State sovereignty as expressed in the Tenth Amendment equated more to a general idea than to any real applicable and relevant State power over the federal government; that the Constitution must be liberally interpreted for the sake of expanding federal powers at the expense of State sovereignty; and that the idea of State sovereignty was literally ridiculous. By the way, even most self-called conservatives today probably subscribe to these political beliefs, not even knowing the real historical facts behind such fallacious ideology.

Concerning Marshall’s philosophical belief relative to the formation of the USA, this historical fact must be admitted. It is crucially important for our discussion today in America. Historian and politically-motivated author, Edward Samuel Corwin, said of Marshall in his book, “John Marshall and the Constitution” (New Haven, CT, Yale Univ. Press, 1920), p. 34: “[Marshall's] attitude [to strengthen the national power and to curtail State legislative power] was determined not only by his sympathy for the sufferings of his former comrades in arms and by his veneration for his father and for Washington . . . but also by his military experience, which had RENDERED THE PRETENSIONS OF STATE SOVEREIGNTY RIDICULOUS IN HIS EYES.” (Emphasis added.) There is no question that Marshall had a pre-destined belief against State sovereignty in favor of national power. Corwin describes Marshall’s political belief regarding the US as a “nationalistic creed.”

So, is the nationalistic political persuasion of one man (appointed by a nationalistic President) and one court to form the basis of the true understanding of the nature and character of the USA? After all, Marshall admitted that the US is established by the rule of law, and not the rule of men. So, by Marshall’s own definition in Marbury v. Madison, a US S CT opinion does not establish law, but rather should reflect what the paramount law already is: “The constitution is either a superior, paramount law, unchangeable by ordinary means, or it is on a level with ordinary legislative acts, and like other acts, is alterable when the legislature shall please to alter it.” So, as the age-old question has gone: who determines whether or not the federal government has usurped power from the people of the states and from the State governments? The Marbury v. Madison believers are likely jumping up and down right now, raising their hands, saying, “Oh! Pick me! Pick me! I know! I know!” I can just see smirks on the faces of most ABA-law school graduates as they condemn anyone who would advocate another position to be true which is contrary to what Marshall presupposed to be true. Of course, their rationale goes as deep as a kiddy-pool and their thought process as far as an inner-city driveway.

Since 1803, the nationalists have pointed to Marshall’s declaration to conclusively say the states have no power over the opinion of the US S CT, for as Marshall states: “It is emphatically the province and duty of the judicial department to say what the law is.” From this, most American lawyers and law students come to the conclusion that there is no authority above and beyond the US S CT’s interpretation of the US Constitution. Whatever the US S CT rules becomes “settled law” and the states are completely bound–of course, unless the US S CT says something different later. I was taught this in law school and every other ABA-accredited law school in America teaches this. But a true legal study of Marbury v. Madison reveals that Marshall’s opinion (which was actually dicta) never addressed the issue of State sovereignty whatsoever. American historian, Forrest McDonald, reveals this fact in his book, “State’s Rights and the Union: Imperium in Imperio, 1776-1876.” McDonald states, “Marshall was careful not to claim that the Supreme Court was the SOLE or FINAL ARBITER of acts of Congress.” (Emphasis added.) Ibid., (Lawrence, KS, Univ. Press of Kansas, 2000), p. 56. This is, in fact, the case.

Perhaps most telling about Marshall’s silence on the issue of being the sole or final arbiter is the fact that just a few years prior to his decision, Thomas Jefferson and James Madison, through the Virginia and Kentucky Resolutions of 1798 and 1799, had advocated the State’s ability to actively nullify and resist unconstitutional actions from the federal government. Since Marshall’s opinion was mostly dicta anyway–meaning it had no relevance to the issue at hand–why not go ahead and state that the US S CT is the ONLY final arbiter of the US Constitution? But Marshall never did, and neither has any US S CT decision since Marbury v. Madison.

Thus, when someone suggests that the states possess the sovereign power to arrest federal encroachments outside of constitutionally enumerated powers, the nationalists emphatically argue their unsupported conclusion that the USA is one nation, indivisible, where the US S CT possesses the sole authority as the final arbiter on all matters politically relative to the US Constitution, and to suggest otherwise is treason!–even when the most authoritative sources have been so pointedly laid out to the contrary. Marshall’s opinions have not settled this matter, and the USA must come to grips with who we are, what we are and how we are.

What’s more, Marshall’s opinions of national expansion were conclusively derived from one main principle: that the USA is a nation formed by the whole people and not by individual states through a compact. This fact was admitted by Marshall-lover, Corwin, in 1920. Corwin clearly expresses this point as follows:

“The great principles which Marshall developed in his interpretation of the Constitution from the side of national power . . . were the following: ‘(1) THE CONSTITUTION IS AN ORDINANCE OF THE PEOPLE OF THE UNITED STATES, AND NOT A COMPACT OF THE STATES. (2) Consequently it is to be interpreted with a view to securing a beneficial use of the powers which it creates, not with the purpose of safeguarding the prerogatives of state sovereignty. (3) The Constitution was further designed . . . to be kept a commodious vehicle of the nation life . . . . (4) [The national government] is a sovereign government, both in its choice of the means by which to exercise its power and in its supremacy over all colliding or antagonistic powers. (5) The powers of Congress to regulate commerce is an exclusive power, so that the States may not intrude upon this field even though Congress has not acted. (6) The National Government and its instrumentalities are present within the States, not by the tolerance of the States, but by the supreme authority of the people of the United States.’ Of these several principles, THE FIRST IS OBVIOUSLY THE MOST IMPORTANT AND TO A GREAT EXTENT THE SOURCE OF THE OTHERS.” “John Marshall and the Constitution,” pp. 144-145. (Emphasis added.)

Corwin admits that all of Marshall’s opinions were based upon the presumption that the USA is a nation formed by the whole people as one body politic, and not by the individual, sovereign states via a compact. From this premise comes the vast expansion of federal power under the guise of constitutionality. Thus, if it were to be contrarily presumed that the USA is in fact a compact acceded to by the states, then the rules of interpretation that Marshall and subsequent US S CT justices used were wrong and require a different outcome. This fact cannot be overstated and is the source of all of the federal tyranny that many of you reading this article complain about. Thus, it behooves Americans to truly know WHAT IS THE TRUE NATURE AND CHARACTER OF OUR UNION: is it a National government formed by the whole people, or is it a compact among the states and acceded to by the states (otherwise known as a Confederacy)?

This article does not allow me to expound upon this subject in great depth, but it should be sufficient at this point at least to call into question Marshall’s presupposition regarding the nature and character of the USA by referring to some of the most authoritative sources on the subject during the formation of the US Constitution. Let us start with James Madison, who was one of the Federalist Paper authors and considered to be the Father of the US Constitution. In Federalist Paper 39, Madison examines the nature and character of the formation of the Union under the US Constitution. He admits that the US was formed by a federative (league of states) and NOT a national act. Madison proclaims:

“[T]he Constitution is to be founded on the assent and ratification of the people of America, given by deputies elected for the special purpose; but . . . this assent and ratification is to be given by the people, NOT AS INDIVIDUALS COMPOSING ONE ENTIRE NATION, BUT AS COMPOSING THE DISTINCT AND INDEPENDENT STATES TO WHICH THEY RESPECTIVELY BELONG. It is to be the ASSENT AND RATIFICATION of the SEVERAL STATES . . . The act, therefore, establishing the Constitution, will NOT BE A NATIONAL, but a FEDERAL act.

“That it will be a federal and NOT A NATIONAL ACT . . . THE ACT OF THE PEOPLE, AS FORMING SO MANY INDEPENDENT STATES, NOT AS FORMING ONE AGGREGATE NATION, IS OBVIOUS from this single consideration, that it is to result neither from the decision of a MAJORITY of the people of the Union, nor from that of a MAJORITY of the States. It must result from the UNANIMOUS ASSENT OF THE SEVERAL STATES that are parties to it . . . [T]he new Constitution will . . . be a FEDERAL, and not a NATIONAL constitution.” (Emphasis added.)

Madison pens in the clearest of terms that the US Constitution is a compact assented to by the State sovereigns in their legal capacities as individual bodies politic, and NOT as one mass of people, forming one body politic. If this were not enough to at least raise a serious question as to what has been shoved down our throats for 150 years, consider that even Alexander Hamilton confirms that the US Constitution is a compact between the states, and NOT a national act of the whole people. He says in Federalist Paper 85:

“To its complete establishment throughout the Union, [the US Constitution] will therefore REQUIRE THE CONCURRENCE OF THIRTEEN STATES . . . [T]he necessity of moulding and arranging all the particulars which are to compose the whole, in such a manner as to satisfy all the parties to the COMPACT . . . WE MAY SAFELY RELY ON THE DISPOSITION OF THE STATE LEGISLATURES TO ERECT BARRIERS AGAINST THE ENCROACHMENTS OF THE NATIONAL AUTHORITY.” (Emphasis added.)

Just in these two short excerpts from Founding Fathers, James Madison and Alexander Hamilton, we see that Marshall’s premise that the USA is a nation formed by the whole of the people and not by the compact of the states is seriously called into question, which, of course, calls into question all of the principles of constitutional interpretation and resulting conclusions which derive from that false premise.

An honest look at the presumption that only the US S CT has the power to interpret federal encroachments on State sovereignty will reveal that the states have more power than what has been admitted ever since Marshall took the position of chief justice of the US S CT. For as Marshall admits in Marbury v. Madison, “questions [that are] in their nature political . . . CAN NEVER BE MADE IN THIS COURT.” (Emphasis added.) By definition, issues of State sovereignty are in their nature political, just as a treaty between the USA and foreign countries regards the matter of political sovereignty. Therefore, when our states begin to assert their natural and sovereign right of self-defense against federal tyranny, each State will answer to their sovereign–the people–and NOT to the United States Supreme Court.

© 2009 Chuck Baldwin – All Rights Reserved

He discusses the debt some progressive causes owe to states’ rights, the Kentucky and Virginia Resolutions, state nullification of unconstitutional federal laws, the undue respect given to the Supremacy Clause, and more.

Thomas E. Woods is the New York Times bestselling author of nine books, including Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse.  A senior fellow at the Ludwig von Mises Institute, Woods holds a bachelor’s degree in history from Harvard and his master’s, M.Phil., and Ph.D. from Columbia University.

One thing that consistently vexes me is the amount of time the modern statists, particularly on the Left, spend labeling the idea of decentralization and secession as “kooky.” The Virginia and Kentucky Resolutions of 1798 – if they have read them or know about them – are often portrayed as quaint and unsophisticated pronouncements of provincialism; the Essex Junto and Hartford Convention are called the products of deranged Northern madmen; Andrew Jackson, they say, was on the right side when he threatened the use of force to keep South Carolinian secessionists in line in 1832; and of course, they revel in the ultimate coup de grâce to states’ rights and secession, the Northern victory in the War for Southern Independence. Who could root for the evil, “undemocratic slave power” clad in butternut, anyway?

This would be well and good if their arguments were logical. They of course forget that the South seceded through a democratic process, but beyond that, one only has to look at the history of American socialists and reformers to find that many of them were secessionists and viewed decentralization as the logical path to their “utopian” society.

The case of the failed “utopian” experiment Brook Farm in Roxbury, Massachusetts nicely illustrates how convoluted the Leftist argument against secession has become.

Brook Farm was established by George Ripley and his wife, Sophia, in 1841. They were transcendentalists who believed in the socialist ideology of Frenchman Charles Fourier, the intellectual progenitor of modern feminism. The Ripley’s devised an autonomous community that emphasized a communal lifestyle in the pursuit of leisure.

Every resident was to share equally in the task of growing products for market in order to maximize the time each individual could spend at leisure and learning. Sophia Ripley also ran the communal school. What they found is that most preferred leisure to work and a handful of the residents kept the rest afloat. Part of the commune ultimately burned down, and the Brook Farm “closed” in 1847.

But Brook Farm illustrated how socialist utopians viewed secession, or the removal from society, as the best means to practice their societal values. Fourier ultimately believed that no more than 1600 people should be involved in a single commune and each commune would be autonomous with only a loose confederation to oversee the entire process. In other words, there was very little large-scale centralization and tremendous decentralization, which they rightly viewed as the most democratic method of government.

Additionally, abolitionists consistently called for secession during the 1840s and 1850s. William Lloyd Garrison, for example, demanded an end to the Union in 1843. Henry David Thoreau simply seceded from society at Walden Pond. Other “reform” communities in New York’s “burnt over” district sought the protection secession offered for their way of life. Secession need not come from an established political entity to exist in fact. These groups in many ways viewed themselves as autonomous and democratic societies operating in disobedience of laws they considered unjust.

John Noyes and many of his followers were eventually run out of Oneida, New York for partaking in group marriage, a practice that violated the moral sensibilities of the rest of the state, but something the community believed was perfectly justifiable and natural. By flaunting their independent religious community and thumbing their nose at the state government, the Oneida community ultimately practiced a form of de facto secession from New York.

The same could be said for many individuals who headed west in the nineteenth century. Several towns operated outside the limits of the law, and federal or state power was often non-existent. “Boom towns” often exemplified the anything-goes spirit of the West, though in time churches, banks, schools, and other civilizing entities would show up. Even then, things remained fairly “rough” as long as the gold and silver kept pouring out of the mines.

These were virtually independent communities and many of the people who resided there were interested in evading government for one reason or another. The West offered anonymity and protection from government abuse. The Mormons, who headed to Utah after being kicked out of Illinois, chose the West for that very reason and ultimately went to war with the United States – and threatened secession – after they were placed under the federal heel. But in spirit, they were already independent and had their own laws and government in place.

These were not “right wing” groups by modern standards, particularly the “reform” communes in New York and Massachusetts, but they understood that decentralization offered a hedge against alien threats to their society and lifestyle. Thomas Naylor of Vermont, hardly a “right winger,” has been trumpeting the idea of an independent Vermont for almost a decade.

He has recognized that the lifestyle Vermont citizens want to enjoy will be consistently retarded by imperial bureaucrats in Washington D.C. This only makes sense. If Californians, for example, want universal health care, have at it, but don’t expect the people of Alabama to pay for it. If New York wants to severely curtail private gun ownership, go for it, but don’t subject the people of Georgia to the same loss of civil liberty. That is how federalism should work and is how the founding generation designed it to work.

Leftists would do well to remember that their complaints about a slow and unresponsive federal government could be solved by decentralization. They have more control over state and local governments and could implement their utopian vision of an egalitarian society more quickly and easily. And, if you don’t like where you live, you can always move to a more suitable republic of your choice. There would be plenty of “conservative” and “liberal” republics to choose from in North America.

Of course, as we all know, modern state socialism is an ideology of power, money, and statism, which is why its “champions” at the federal level, the “progressives,” will never allow decentralization to infiltrate their political vocabulary; however, if enough Americans could be rightly persuaded that Washington is not the answer, either for “conservative” or “liberal” causes, then maybe the people would be willing to part ways and allow the Left to dominate the Northeast and West Coast and the Right to control the South and Mountain States.

This is a peaceful, just, and democratic solution to a centuries-old problem. Let the people of each sovereign state decide their own fate. As Thomas Jefferson said in 1801, “If there be any among us who would wish to dissolve this Union or to change its republican form, let them stand undisturbed as monuments to the safety with which error of opinion may be tolerated where reason is left free to combat it.”

Brion McClanahan [send him mail] received his Ph.D. in American History from the University of South Carolina and is a History Professor at Chattahoochee Valley Community College in Phenix City, Alabama. He is the author of Politically Incorrect Guide to the Founding Fathers (Regnery, 2009).

Copyright © 2009 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.

Tem·po·rar·y – an adjective meaning lasting, used, serving, or enjoyed for a limited time. Derived from the Latin tempora rius, from tempus, tempor-, time.  Synonyms include temporary, acting, ad interim, interim, provisional. Antonym is permanent.

Governor Rendell continues to press for a temporary, 16 percent increase in the Personal Income Tax (PIT), which he argues is the state’s “best option” to balance the state budget.

He says a PIT increase wouldn’t be as bad since roughly half of Pennsylvania households would not pay it. For the half that would end up footing the tax bill, the Governor says the increase would be “less than $5 per week.”

Milton Friedman said:  “Congress can raise taxes because it can persuade a sizable fraction of the populace that somebody else will pay.”

Although $5 may not seem a lot to the Governor, this “temporary tax” adds up to $20 a month, or $240 a year – money I am sure individuals would rather spend elsewhere.

From a look at the definition, “permanent” is an antonym of “temporary;” that is exactly what has become of other “temporary” tax increases throughout Pennsylvania history.

The most famous (or infamous) temporary tax is the 1936 Johnstown Flood Tax.  Enacted as a 10 percent tax on liquor, the toll was set to expire May 31, 1937.  Over the years, the sunset date was extended numerous times until the tax was made permanent in 1951.  The current rate is 18 percent.

A year prior to the Johnstown Flood Tax, the Cigarette Tax was enacted as another emergency tax of 0.1 cent per cigarette. It became permanent in 1951, and the current rate is 6.75 cents per cigarette.

Other “temporary” taxes include the Realty Transfer Tax – enacted in 1951 as a 1 percent temporary tax. The tax was made permanent in 1961 and the rate remains at 1 percent.

The Corporate Net Income Tax (CNI) was first imposed in 1935 at a rate of 6 percent.  The rate “temporarily” was raised in 1977 to 10.5 percent, which was made permanent in 1982.  In 1991, the rate reached a high of 12.25 percent, and in 1995, lowered to its current rate of 9.9 percent.

The Sales and Use Tax was enacted in 1953, and eventually evolved into support for public education.  The tax started at 1 percent and currently is at 6 percent. The initial 6 percent imposition was also to be temporary until 1969, however, later that year the 6 percent was made permanent. Philadelphia and Allegheny County impose another 1 percent on purchases in their jurisdictions.

The Personal Income Tax (PIT) was imposed in 1971 at 2.3 percent.  Throughout the years, the rate has varied and some increases automatically sunsetted.  The PIT reached its current high in 2003 when Governor Rendell raised the rate to its current 3.07 percent.

As you can see, temporary taxes are rarely temporary and higher taxes are simply no good for Pennsylvania’s future or economic recovery. We must get government spending under control and have additional choices other than raising taxes – even if only “temporary.”

Mike Folmer [send him email] of Lebanon, Pennsylvania is a Pennsylvania State Senator who represents the 48th Senate district, which includes all of Lebanon County and portions of Berks, Chester, Dauphin and Lancaster Counties.

Jefferson once wrote, “When all government, domestic and foreign, in little as in great things, shall be drawn to Washington as the center of all power, it will render powerless the checks provided of one government on another, and will become as venal and oppressive as the government from which we separated.” To resist this centralizing trend, the sage of Monticello was convinced, the states needed some kind of corporate defense mechanism.

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