1787 Federalist 32 · Founding Made Plain

11787 Federalist No. 32

2The Same Subject Continued

3Concerning the General Power of Taxation

4From the Daily Advertiser.

5Thursday, January 3, 1788.

6HAMILTON

7To the People of the State of New York:

8ALTHOUGH I am of opinion

9 that there would be no real danger

10 of the consequences which seem to be apprehended

11 to the State governments

12 from a power in the Union

13 to control them in the levies of money,

14 because I am persuaded that the sense of the people,

15 the extreme hazard of provoking the resentments

16 of the State governments,

17 and a conviction of the utility and necessity

18 of local administrations for local purposes,

19 would be a complete barrier

20 against the oppressive use of such a power;

21 yet I am willing here to allow, in its full extent,

22 the justness of the reasoning

23 which requires that the individual States

24 should possess an independent

25 and uncontrollable authority

26 to raise their own revenues

27 for the supply of their own wants.

28And making this concession, I affirm

29 that

30 (with the sole exception

31 of duties on imports and exports)

32 they would, under the plan of the convention,

33 retain that authority

34 in the most absolute and unqualified sense;

35 and that an attempt on the part

36 of the national government

37 to abridge them in the exercise of it,

38 would be a violent assumption of power,

39 unwarranted by any article or clause

40 of its Constitution.

41An entire consolidation of the States

42 into one complete national sovereignty

43 would imply an entire subordination of the parts;

44 and whatever powers might remain in them,

45 would be altogether dependent on the general will.

46But as the plan of the convention aims only

47 at a partial union or consolidation,

48 the State governments would clearly retain

49 all the rights of sovereignty

50 which they before had,

51 and which were not, by that act,

52 EXCLUSIVELY delegated to the United States.

53This exclusive delegation,

54 or rather this alienation, of State sovereignty,

55 would only exist in three cases:

56 where the Constitution in express terms granted

57 an exclusive authority to the Union;

58 where it granted in one instance an authority

59 to the Union,

60 and in another prohibited the States

61 from exercising the like authority;

62 and where it granted an authority to the Union,

63 to which a similar authority in the States

64 would be absolutely and totally

65 CONTRADICTORY and REPUGNANT.

66I use these terms to distinguish this last case

67 from another which might appear to resemble it,

68 but which would, in fact, be essentially different;

69 I mean where the exercise of a concurrent jurisdiction

70 might be productive of occasional interferences

71 in the POLICY of any branch of administration,

72 but would not imply any direct contradiction

73 or repugnancy

74 in point of constitutional authority.

75These three cases of exclusive jurisdiction

76 in the federal government

77 may be exemplified by the following instances:

78The last clause but one

79 in the eighth section of the first article

80 provides expressly that Congress shall exercise

81 "EXCLUSIVE LEGISLATION"

82 over the district to be appropriated

83 as the seat of government.

84This answers to the first case.

85The first clause of the same section empowers Congress

86 "TO LAY AND COLLECT TAXES,

87 DUTIES, IMPOSTS AND EXCISES";

88 and the second clause of the tenth section

89 of the same article declares that,

90 "NO STATE SHALL,

91 without the consent of Congress,

92 LAY ANY IMPOSTS OR DUTIES

93 ON IMPORTS OR EXPORTS,

94 except for the purpose of executing

95 its inspection laws."

96Hence would result an exclusive power in the Union

97 to lay duties on imports and exports,

98 with the particular exception mentioned;

99 but this power is abridged by another clause,

100 which declares that no tax or duty shall be laid

101 on articles exported from any State;

102 in consequence of which qualification,

103 it now only extends to the DUTIES ON IMPORTS.

104This answers to the second case.

105The third will be found in that clause

106 which declares that Congress shall have power

107 "to establish an UNIFORM RULE

108 of naturalization throughout the United States."

109This must necessarily be exclusive;

110 because if each State had power

111 to prescribe a DISTINCT RULE,

112 there could not be a UNIFORM RULE.

113A case which may perhaps be thought

114 to resemble the latter,

115 but which is in fact widely different,

116 affects the question immediately

117 under consideration.

118I mean the power of imposing taxes

119 on all articles other than exports and imports.

120This, I contend, is manifestly

121 a concurrent and coequal authority

122 in the United States

123 and in the individual States.

124There is plainly no expression

125 in the granting clause

126 which makes that power EXCLUSIVE in the Union.

127There is no independent clause or sentence

128 which prohibits the States from exercising it.

129So far is this from being the case,

130 that a plain and conclusive argument to the contrary

131 is to be deduced from the restraint

132 laid upon the States

133 in relation to duties on imports and exports.

134This restriction implies an admission

135 that, if it were not inserted,

136 the States would possess the power it excludes;

137 and it implies a further admission,

138 that as to all other taxes,

139 the authority of the States remains undiminished.

140In any other view it would be both

141 unnecessary and dangerous;

142 it would be unnecessary,

143 because if the grant to the Union

144 of the power of laying such duties

145 implied the exclusion of the States,

146 or even their subordination

147 in this particular,

148 there could be no need of such a restriction;

149 it would be dangerous,

150 because the introduction of it

151 leads directly to the conclusion

152 which has been mentioned,

153 and which, if the reasoning of the objectors

154 be just, could not have been intended;

155 I mean that the States,

156 in all cases to which the restriction

157 did not apply,

158 would have a concurrent power of taxation

159 with the Union.

160The restriction in question amounts to

161 what lawyers call a NEGATIVE PREGNANT

162 that is, a NEGATION of one thing,

163 and an AFFIRMANCE of another;

164 a negation of the authority of the States

165 to impose taxes on imports and exports,

166 and an affirmance of their authority

167 to impose them on all other articles.

168It would be mere sophistry to argue

169 that it was meant to exclude them ABSOLUTELY

170 from the imposition of taxes

171 of the former kind,

172 and to leave them at liberty to lay others

173 SUBJECT TO THE CONTROL

174 of the national legislature.

175The restraining or prohibitory clause only says,

176 that they shall not,

177 WITHOUT THE CONSENT OF CONGRESS,

178 lay such duties;

179 and if we are to understand this

180 in the sense last mentioned,

181 the Constitution would then be made

182 to introduce a formal provision

183 for the sake of a very absurd conclusion;

184 which is, that the States,

185 WITH THE CONSENT of the national legislature,

186 might tax imports and exports;

187 and that they might tax every other article,

188 UNLESS CONTROLLED by the same body.

189If this was the intention,

190 why not leave it, in the first instance,

191 to what is alleged to be the natural operation

192 of the original clause,

193 conferring a general power of taxation

194 upon the Union?

195It is evident that this could not have been

196 the intention,

197 and that it will not bear

198 a construction of the kind.

199As to a supposition of repugnancy

200 between the power of taxation

201 in the States and in the Union,

202 it cannot be supported in that sense

203 which would be requisite

204 to work an exclusion of the States.

205It is, indeed, possible that a tax might be laid

206 on a particular article by a State

207 which might render it INEXPEDIENT

208 that thus a further tax should be laid

209 on the same article by the Union;

210 but it would not imply a constitutional inability

211 to impose a further tax.

212The quantity of the imposition,

213 the expediency or inexpediency of an increase

214 on either side,

215 would be mutually questions of prudence;

216 but there would be involved

217 no direct contradiction of power.

218The particular policy of the national

219 and of the State systems of finance

220 might now and then not exactly coincide,

221 and might require reciprocal forbearances.

222It is not, however a mere possibility

223 of inconvenience in the exercise of powers,

224 but an immediate constitutional repugnancy

225 that can by implication alienate and extinguish

226 a pre-existing right of sovereignty.

227The necessity of a concurrent jurisdiction

228 in certain cases

229 results from the division of the sovereign power;

230 and the rule that all authorities,

231 of which the States are not explicitly divested

232 in favor of the Union,

233 remain with them in full vigor,

234 is not a theoretical consequence of that division,

235 but is clearly admitted by the whole tenor

236 of the instrument

237 which contains the articles

238 of the proposed Constitution.

239We there find that,

240 notwithstanding the affirmative grants

241 of general authorities,

242 there has been the most pointed care

243 in those cases where it was deemed improper

244 that the like authorities should reside

245 in the States,

246 to insert negative clauses

247 prohibiting the exercise of them by the States.

248The tenth section of the first article

249 consists altogether of such provisions.

250This circumstance is a clear indication

251 of the sense of the convention,

252 and furnishes a rule of interpretation

253 out of the body of the act,

254 which justifies the position I have advanced

255 and refutes every hypothesis to the contrary.

256PUBLIUS.