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The Spending Power is Madisonian, not Hamiltonian: Part I (Problems with the Hamiltonian Interpretation)

Michael Greve has two interesting responses to my comments on his book.  One of his responses argues that the Madisonian interpretation of the spending power that I recommend is inconsistent with the language of the Constitution.  Thus, Michael concludes that we are stuck with the Hamiltonian interpretation of the spending power, whether we like it or not.

I don’t agree.  As an originalist, I believe that the Madisonian interpretation, rather than the Hamiltonian one, accords with the original meaning.  In a series of two posts, I will explain why.  This post criticizes the Hamiltonian interpretation.  My next one defends the Madisonian interpretation, using what I think are some new arguments.

First, some definitions.  The Madisonian interpretation of the spending power reads the power as limited to spending on the other enumerated powers of the federal government.  The Hamiltonian interpretation of the spending power, by contrast, argues that Congress has the power to spend for the general welfare, even if its spending is not authorized by any other enumerated power.

The constitutional language reads: “The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States.”

1. The first point to be clear about is that this language means “The Congress shall have power to lay and collect taxes . . . in order  to pay the debts and provide for the common defense and general welfare of the United States.”  Paying the debts and providing for the common defense and general welfare are the purposes for which the taxes are collected.

The alternative interpretation would read the language as saying “The Congress shall have power to lay and collect taxes . . . and power  to pay the debts and provide for the common defense and general welfare of the United States.”   Under this interpretation, there are two separate powers: the power to tax and the power to provide for the common defense and general welfare.  This reading seems far worse for a variety of reasons too numerous to go into here.  To just mention one, it would be odd to list the extremely broad power of providing for the common defense and general welfare after the power to lay and collect taxes (dividing them with a comma rather than a more grammatically correct “and” or semicolon) and then to return at the end of the sentence to address the taxing power again by requiring all duties to be uniform throughout the United States.

2. So let’s assume the language means “in order to provide for the general welfare.”  Once we do that, though, a problem arises.  The power to spend for the general welfare (beyond the enumerated powers) is an enormous power.  It authorizes Social Security,  Medicare, and Medicaid, to name just a few programs.  It would be odd to convey that power by describing it (as this reading does) as the purpose of the taxing power.  Rather, such a large power should be listed as an independent power (but as we have just seen, the language cannot be read in that way).

The language here says the government can tax in order to  spend for the general welfare.  The constitution usually provides for significant powers by listing them separately such as the power to declare war, to regulate interstate commerce, to tax, etc.  Thus, one needs an explanation for why such a significant power would be phrased merely as the purpose of the taxing power.  (In my next post, I explain why the language takes the form of a purpose, using an explanation that supports the Madisonian interpretation.  The Hamiltonian interpretation has, as far as I can see, no explanation for why the language takes the form of a purpose.)

3. Another problem with the Hamiltonian interpretation is that it requires us to believe that the Framers would have conveyed an enormous power like spending for the general welfare while limiting that power only with an extremely vague term like “general welfare.”  They understood that general welfare was difficult to define.  If one looks at Congress’s other powers, they are not limited by such vague terms.  Even though the Framers use general terms that certainly require interpretation, like commerce among the states, the terms they use are uniformly less vague and clearer than “spending for the general welfare.”  This vagueness, combined with the fact that the alleged power is in the form of a purpose, make it extremely unlikely that the Constitution is conveying the Hamiltonian spending power.

These are main problems with the Hamiltonian interpretation.  In my next post, I defend the Madisonian interpretation.

Reader Discussion

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on June 15, 2012 at 09:40:01 am

How about a bit of closer attention to two words in the "Powers" clause:

"general" (lowers case-adjective, modifies) "Welfare" (capped-noun, subject to be given meaning).

Leaving aside the issue of whether the two words are limited to the purposes for the Power to Tax, or further that such power of taxation is for the purpose of capacity to "spend, let us look at the spending alon in terms of those two words, and consider these questions:

FICA is a tax. Social Security payments are made to only to specified classes of persons; those who survive to a certain age and have had a specified type of participation in the economics of the society (SS Earnings).
That is spending for the benefit of a particular class; it is not "general" - as in the sense of a roadway for public use, subject to rules, but otherwise without limitations.

Medicare is a tax. The payments are made for the benefit of a specific class, determined principally by age and limited to specified participants, who are survivors to a certain age, who use certain specified medical services. It is not "general."

Medicaid payments are "welfare" payments in common parlance; but, they are not "general." They are made to specified classes of beneficiaries.

Educational grants and aid are class benefits available only to some and subject to arbitrary rules of disbursements.

Arguments are made that all these "spending items" contribute to or benefit, in some way, the overall conditions of our society, and therefore "provide" for the "general Welfare."

So that is your issue: general Welfare; not power to Tax vis a vis power to Spend.

Not so strangely, it is exactly those items of spending which are destroying the fiscal stability of the Federal government. If we do not transition away from the loose, indefinite concept of any form of possible social benefit constituting "general Welfare," we will have to devise a different form of government and its funding for our social order.

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Richard Schweitzer
on June 15, 2012 at 12:56:13 pm

"The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States..."

I see this as saying something much simpler:
"Congress may tax (i) to pay the debts, (ii) provide for the common defense, or (iii) provide for the general welfare, of the United States."

Simply put: the only power granted here is the power to tax; there is no power to spend given in that instance. Hence, you are incorrect even to call it The Spending Clause. Also, shoehorning a spending power into this clause ignores an easier and more readily identifiable place to find a spending power: the Necessary and Proper Clause.

Returning to my numbered interpretation: taxing for purpose one is simply debt retirement, and for purpose two defense spending.

But what of purpose three? What does it mean? The easiest way to figure that out is to ignore the language and observe what power is lost. So doing, the power which falls by the wayside in the absence of the language is that of regulatory fees. For example, without the general welfare language, Congress could lay import duties only enough to defray the costs of customs and port services, but no more. With the general welfare language, Congress then has the ability to engage in mercantilist protectionism by setting import duties above the cost of those services in order to benefit domestic industries. Thus, the power to tax for the general welfare is demonstrated to be limited to the setting of taxes and fees which regulate commerce.

The residual non-commercial and non-military powers enumerated and granted to Congress are such that they have historically been user-fee based (postage fees, patent fees, court filing fees, etc.), which fall well within the ambit of the NPC.

Even John Marshall himself said "Congress is not empowered to tax for those purposes which are within the exclusive province of the States" in Gibbons v. Ogden (1824). Given that statement, and the language of the Tenth Amendment, I still wonder where Congress and the Courts find the authority to provide social spending programs.

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J.D.

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