Alexander Hamilton: “Opinion as to the Constitutionality of the Bank of the United States”

Explanation and Analysis of the Document

In his treatise, Alexander Hamilton does little to alleviate Thomas Jefferson's suspicions about the creation of the bank. Jefferson portrays political power as the great corrupter: If congressmen thought a national bank was constitutional, then there could be no limit to what they might propose next. Hamilton is more restrained, offering a measured response to the situation at hand. The country's economy was in trouble, and a national bank would help rescue it.

Lacking the prosaic elegance typical of a refined Virginia planter, Hamilton delivers a point-by-point refutation that drowns his opponents in verbiage and rhetorical might. Essentially, his argument closely follows his belief that the national government must possess complete sovereignty and, as such, must possess all the means and powers requisite to the fulfillment of its purpose of securing “social order.” These powers are supreme and cannot be undermined by any other institution, including the state governments. He agrees that the federal government possesses expressly delegated powers, but these are understood to be supplemented by “implied” powers and what Hamilton calls “resting powers.” The power to erect or incorporate a national bank falls within the latter two spheres, not that of express delegations. For a policy to be constitutional to Hamilton, it merely needs “a natural relation to any of the acknowledged objects or lawful ends of the government.”

Hamilton then attacks Jefferson's contention that the “necessary and proper” clause limits the federal government to engaging in matters deemed essential. Such was not the popular meaning of the term necessary, he claims, and would “beget endless uncertainty and embarrassment” in addition to making most policies inoperative. Anything deemed essential to the “advancement of the public good,” he holds, should be “construed liberally.” Hamilton insists that the national government is the bedrock of American society. While not admitting “that the national government is sovereign in all respects,” Hamilton writes that “it is sovereign to a certain extent; that is, to the extent of the objects of its specified powers.”

With little patience for Jefferson's “originalist” doctrines, Hamilton insists that one could trust neither the memories of the delegates to the Philadelphia Convention nor the conflicting accounts of what the framers intended the new government to be. Instead, intention must “be sought for in the instrument [the Constitution] itself, according to the usual and established rules of construction.” Hamilton honestly thinks that these rules allowed for the creation of a national bank. He asserts that these circumstances did not imply, as Jefferson and Randolph were contending, that federal government officials could simply do as they pleased.

After dismissing Jefferson's and Randolph's opinions, Hamilton spends considerable effort tracing the legality of a national bank outside the realm of constitutional jurisprudence. Equally impressive is his subsequent justification of banks in general and the important role that they could play in improving the economy and in funding future wars. He even goes so far as to claim that “the support of troops” depended on whether Congress could successfully create a national bank—an argument sure to move Washington, if he were to manage to read that far.

Hamilton clearly had the upper hand in the argument, not because of his rhetorical skill but because of the nature of the subject. Jefferson accepted the terms of the debate when he echoed James Madison's reasoning on the floor of the House of Representatives, treating the bank bill as a matter of constitutionalism rather than sound economic policy. Jefferson's opinion, though perhaps more elegant, leaves open the question of whether a national bank would actually help the economy. Hamilton enjoys free reign in touting the economic virtues of the proposed bank, which makes his argument appear sounder than Jefferson's.

It is not clear who gained ground in the argument either in the president's cabinet or in Congress following the delivery of Jefferson's and Hamilton's opinions. The national bank bill did pass, but neither Hamilton nor Jefferson could be said to have claimed total victory or to have conceded defeat.