...the continual effort and alarm attendant upon a state of continual danger, will compel nations the most attached to liberty, to resort for repose and security to institutions which have a tendency to destroy their civil and political rights. To be more safe, they, at length, become willing to run the risk of being less free
The words, from Federalist no. 8, are eerily prescient. Alexander Hamilton was arguing that the states, in a state of disunion, would be compelled, because of their perpetually vulnerable position, to resort to establishing "standing armies," which would gradually erode liberty. Standing armies were a notorious bugbear in 18th-century republican thought because they were seen as instruments of tyranny: established to ensure security from external dangers, they inevitably became instruments of internal coercion. This happened, in large part, because standing armies required a strong executive at their head—a Caesar who could use the army to secure his own position as head of the state. Hamilton says: "It is the nature of war to increase the executive, at the expense of the legislative authority."
The lesson seems not to have been lost on Dick Cheney: if you want to increase executive power, start a war.
Hamilton was arguing that the Constitution, by creating a strong federal union, would lessen these dangers. The United States would be less vulnerable to external threats than would a collection of small independent republics, all of them liable to fight among themselves and ripe for picking by larger European powers. But only a decade after Hamilton wrote those words, the United States was in an undeclared Quasi-War with France, Hamilton himself was dreaming of empire as inspector general of the army, and the Alien and Sedition Acts had placed severe limits on political expression. To feel more more safe, we had become less free.
In Federalist no. 7, Hamilton takes a look at some of the potential causes of what he himself calls "a war between the states," which he believed would be dealt with successfully under the Constitution. The three major issues were the Western lands, commerce, and debt.
1. The Western lands. He believed that the states, left in a state of disunion, would fight over control of the Western territories—as, for example, Connecticut and Pennsylvania had come to blows in the 18th century over control of the Wyoming Valley. Under the Constitution, he argued, the land would become federal land, and the central authority would defuse the potentially explosive rival claims of the states. Unfortunately, even under the Constitution, the issue of control over the Western lands contributed to war between the states, as North and South argued over whether those lands would become slave states or free. The first battles of the Civil War were really fought in the West, in Kansas, because the Constitution had failed to resolve the issue of slavery.
2. Commerce. Hamilton foresaw strife if states like New York, which handled large amounts of international trade, raised revenue with import tariffs and passed the additional cost onto consumers in other states that relied on imported goods. Hamilton argued that federal control of interstate commerce would solve this problem, and a "commerce clause" (sometimes referred to as the "interstate commerce clause") was incorporated into the Constitution (Article 1, Section 8, clause 3). This is why, if you make an internet purchase from a company in another state, you don't have to pay that state's sales tax. Unfortunately, it was precisely over the issue of tariffs, not slavery, that the fatal rift between North and South first began to open in the late 1820s, when Southern states (led by South Carolina) provoked a Constitutional crisis over the "tariff of abominations," which was seen as protecting Northern industry at the expense of the South's agricultural economy.
3. Debt Payment. This was a hot issue in 1787 because different states carried differing burdens of public debt as a result of the Revolutionary War. Some states had made progress toward retiring their war debt, others, like renegade Rhode Island, had repudiated it all together. Hamilton was afraid that these inequalities, and tensions between debtor and creditor states, would lead to conflict. One of Hamilton's great successes as the first secretary of the treasury was to have the federal government assume the states' war debts. He used the funding of that debt as the basis for creating a national bank and complete national financial system (which became synonymous with the street in New York where Hamilton lived: Wall Street).
So, as I see it, Hamilton went 1-and-2 in Federalist no. 7: his scheme for assumption of the war debt seemed to work, but commerce and the Western lands remained live issues that provoked Constitutional crises later on.
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