How did Hamilton and Jefferson interpret the Constitution differently to arrive at their positions on the creation of a Bank of the United States?

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davmor1973 eNotes educator| Certified Educator

Hamilton and Jefferson's differences in relation to constitutional interpretation were ultimately grounded in their competing visions of what kind of country they wished to see the United States become. Jefferson conceived of America as an agrarian republic consisting of independent, self-reliant farmers whose intimate connection to the soil would give them a stake in the wise governance of the new nation.

Hamilton, on the contrary, saw the United States as a mercantile nation whose future prosperity depended very much on international trade. Over time, Hamilton became an eloquent spokesman for commerce and industry, while Jefferson became equally renowned for articulating the cause of rural interests. The differences between the two men prefigured those that would lead to the Civil War.

It is against this background that we can best understand the respective attitudes of Hamilton and Jefferson towards the Constitution in relation to the establishment of a central federal bank.

Hamilton recognized that a thriving commercial sector depended upon a secure, reliable banking system. The ready availability of credit was the very lifeblood of the system Hamilton envisaged. In this regard, the setting up of a national bank was essential. Not only would it make credit available for domestic manufacture, it would also put the nation's finances on a firm and stable footing, bringing much-needed confidence to America's international trade partners.

Jefferson, suffice to say, was radically opposed to this vision. There were two main grounds for his objections. Firstly, he strongly believed that the establishment of a central bank would give too much power to the federal government. Inevitably, this would come at the expense of the states, and Jefferson, as a redoubtable champion of states' rights, clearly couldn't stomach such a development.

Secondly, Jefferson's idealized agrarian vision of America simply couldn't countenance the development of the United States as a predominantly mercantile nation. For one thing, this would undoubtedly lead to the development of factions, who would use their new-found wealth to corrupt the system in their own favor. There is certainly more than a hint of snobbery about Jefferson's position; this is not particularly surprising given his background as a gentleman farmer and proud member of Virginia's rural elite. Nevertheless, Jefferson articulated a widespread distrust of the kind of country that was already starting to develop and which Hamilton wholeheartedly endorsed.

Hamilton's interpretation of the Constitution in relation to the establishment of a national bank was somewhat creative, to say the least. He broadly interpreted the "Necessary and Proper Clause" of Art.1 of the Constitution to authorize Congress to "make all laws necessary and proper" for carrying out powers that had already been specifically granted. The Constitution, unlike the Articles of Confederation, explicitly authorized the federal government to levy taxes, pay debts, and borrow money. The establishment of a central bank was a means to allowing these important governmental tasks to be carried out.

Jefferson construed the Constitution's relevant provisions in much narrower terms. The Constitution, he argued, explicitly divided up the relevant powers between the federal government and the states, and nowhere did it expressly state that the establishment of a central bank was one of the federal government's powers.

Hamilton ultimately prevailed. And the United States today is a monument to his abiding vision. At the same time, Jefferson's matchless zeal for republican liberty and his strictly constructionist approach to the Constitution still live on, providing a necessary corrective to the seemingly endless expansion of federal authority.

pohnpei397 eNotes educator| Certified Educator

In this controversy, Jefferson interpreted the Constitution very strictly while Hamilton interpreted it loosely.  Jefferson argued that anything that the Constitution did not explicitly allow could not be done.  Hamilton argued that anything that the Constitution did not explicitly ban could be done.

This was the first major debate over how to interepret the Constitution.  Jefferson wanted to be a strict constructionist.  When he looked at the "necessary and proper" clause, he emphasized the word "necessary."  He said that the Constitution only meant that things that were absolutely necessary could be done.  Hamilton, by contrast, argued that it was obvious that any government had the power to charter a corporation like the bank, whether it was explicitly stated in the Constitution or not.  He said that any power that was related to (as opposed to necessary for) an end that was specifically allowed in the Constitution could be done.  Therefore, he said, a bank could be created because it was related to things like collecting taxes and regulating the currency.

The major difference, then, was in whether the Constitution should be interpreted strictly, with only explicit powers being allowed (as Jefferson wanted) or whether it should be interpreted loosely, with implied powers being allowed.