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The Federalist Papers: No. 30

On this day in 1787, Federalist Paper No. 30 is published. The Federalist Papers are a collection of essays that were published in New York newspapers in late 1787 and early 1788. They argued FOR the new Constitution, then being considered for ratification by the states.

Yes, I did skip paper no. 29! (Bonus points if you noticed?! Ha.) That essay is out of order in the collection. A summary of paper no. 29 is coming, but not until its original January (newspaper) publication date.

Many of you will find this particular essay frustrating, because Alexander Hamilton (a.k.a. “Publius”) is defending the proposition that the national government needs a better system of collecting taxes. Please remember that he lived in a time when the national government had great difficulty in collecting taxes – any at all – from the states. The inability to raise funds complicated the war effort because Congress had difficulty financing the needs of George Washington’s army. By contrast, we live in a time when it is apparently a little TOO easy for Congress to tax us. We even get taxed for failing to purchase an item like health care.

We need to regain the happy middle ground.

Publius begins by noting that the government legitimately needs to finance such items as defense and the national debt. The government, he says, needs “a general power of taxation, in one shape or another.” Without it, “the people must be subjected to continual plunder, as a substitute for a more eligible mode of supplying the public wants, or the government must sink into a fatal atrophy, and, in a short course of time, perish.”

The Articles of Confederation were not serving the country adequately in this regard. Although Congress could raise money, it did so by calling upon the states. As all Americans then would have known, that system was not working because the states did not always comply. Publius argues that a new Congress needs the power to “raise its own revenues by the ordinary methods of taxation authorized in every well-ordered constitution of civil government.”

Some “adversaries of the new Constitution” were trying to limit the power of taxation by distinguishing between internal and external taxation. (The former would be left to the states, while the latter would be given to the national government.) Publius rejects this solution as it “would still leave the general government in a kind of tutelage to the State governments,” potentially only partially funded and still dependent upon the states for any remaining funds. (i.e. The very method that had already failed under the Articles of Confederation.)

Publius concludes: “How is it possible that a government half supplied and always necessitous, can fulfill the purposes of its institution, can provide for the security, advance the prosperity, or support the reputation of the commonwealth? How can it ever possess either energy or stability, dignity or credit, confidence at home or respectability abroad?”

My post with more background on the Federalist Papers and their authorship can be found in the Federalist Paper No. 1 summary (see October 27 history post, here).



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