The Glorious Cause, page 75
This thoughtful scheme collapsed almost immediately. The loan officers simply ignored their instructions and issued the indents not according to the congressional schedule but as they chose. The states proved as independent as the federal officials and followed their own policies of payment. They threw the schedule aside—the clamorous creditors were their citizens after all—and usually used the indents in advance for the next year’s interest. They refused to receive indents, or pay them out, to any but their own citizens, and they declined to return specie as requisitions. This refusal was easy to understand and defend—hard money was scarce and states were reluctant to give up what they had when there was no assurance that Congress would return it to their citizens.31
Congress acknowledged its failures in public finance in 1787 when it set aside all requirements in favor of permitting the states to pay on the debt in any way they chose. Now in full control, the states chose increasingly to resort to the old colonial practice of currency finance. And when the year opened at least seven of the states were issuing paper money.
A number of men had watched uneasily the shift of control from Congress to the states. They have been called the “nationalists,” a designation intended by historians to suggest that the men to whom it is applied were not only strongly committed to the increase of the central authority of the government but also that they constituted a virtual party. This party, according to several historians, looked to the replacement of the Articles of Confederation by a constitution which shifted sovereignty from the thirteen states to a national government. The leader of the group when it began to take shape in 1780, it is said, was Robert Morris, the rich Philadelphia merchant who had left Congress two years before after giving it distinguished service for three years. Morris and a small number of friends and business associates did favor a powerful national government, but they never formed anything more than a loose faction. Leadership of this group seemed almost naturally to fall to Morris, a man of great wealth and business and administrative skill. In 1781, he added to these informal qualifications by getting himself appointed Superintendent of Finance.32
The post carried all the authority Congress could vest it with. The superintendent could do almost anything Congress itself might have done in managing public finances, including firing anyone in the public service who handled public money. Morris had insisted on having this sort of muscle; he was not a modest man and his demands for power caused some in Congress to hesitate before approving his appointment. When Morris had sat in Congress he had shown that he had talents besides an appetite for power. He had taken the lead in the Secret Committee of Trade, demonstrating rather impressive gifts for managing its business. He had also shown, like virtually every other merchant who undertook the public’s business, that he would not shrink from using his post to turn a profit. Merchants understood the difference between private and public interests as well as anyone and knew that standards of conduct did not condone the use of office for personal gain. Yet they commonly mixed their own business with the public’s, and Morris sometimes used the government’s money when his own was scarce. He was not a thief nor was he dishonest; yet he sometimes misused his post in Congress. He may have felt justified by the fact that he followed common practice and that in fact holders of public office believed that they had something approaching “private rights” in their offices. In many cases standards of conduct were not high. While Morris did not raise them, neither did he confine his efforts primarily to his own interests, for he wanted to serve his country. He probably never realized that his own conduct contributed to the demoralization of a public increasingly suspicious of those who ran public finance.33
It was public finance that Morris expected would provide the means of constitutional reform. The Articles had denied Congress the right to tax. The states of the Confederation recognized that this power implied sovereignty, and they intended that it remain with themselves. But with the finances of Congress a shambles by 1780, many men, most delegates to Congress, accepted the argument that Congress needed the power to tax to ensure a steady revenue. Without a revenue the various sorts of notes, expressing the obligation of Congress to its creditors, would continue to depreciate. And the problem of supplying the army and keeping the Revolution going until Britain acknowledged American independence would increase in severity.
Thus for Morris and his friends, public finance should be made to incorporate what they took to be the central purposes of the Revolution—the protection of property and the preservation of a political order run by men like themselves. The conduct of the war had taught them much, taught them that sovereignty divided into thirteen pieces made for disorder and an ineffective nation. The disparity between the exertions of the army and the petty squabbling of the states eager to look out after their own, and little more, offended Morris. The propensity of the states to turn to the old methods of public finance frightened him. The old ways were out of step with the new, and the new—large-scale business, international finance, banking, and speculation—could flourish only if political centralization succeeded.
From 1781 until just before Morris resigned in November 1784, he worked carefully and sometimes ruthlessly for a major accretion to congressional power. The impost provided the center of all his efforts. To push it toward approval by all the states as the Articles required, he, Hamilton, and others tried to manipulate the army officers at Newburgh into a body capable of coercing Congress and the states. He failed in this measure, but he succeeded in persuading Congress to assume some of the debt which might have been parceled out to the states. His intention was to ensure that at least a part of the debts from the war remained a national obligation so that a case could be made for assigning the taxing power to Congress. Much of what Morris did succeeded as financial policy but failed as political technique. He instituted a system of bids and contracts in order to supply the army; he rationalized much of federal finance; and he established a corps of officials responsible to Congress—and himself. The end of the war robbed much of this system of its political meaning. Defeat at Yorktown would have served Morris’s purposes far better than victory.34
With peace his disappointments piled up: the states refused his demands for specie; they corrupted his officials; and they took over the business of servicing the debt. Worst of all, though at one time or other the impost seemed on the verge of approval, in the end it failed of passage. By late 1783 Morris had played his best hand, and though he lingered in the superintendent’s office until November 1, 1784, he was beaten. And his methods of attaining a strong national government had proved barren.35
The movement for constitutional revision did not die with Morris’s resignation. Hope persisted in Congress for two years that the impost would gain the unanimous approval of the states. There were other ways of strengthening the central government in any case. Talk surfaced in these years of the possibility of holding a convention from the states which might add to congressional powers. Perhaps a favored means was to give Congress the authority to regulate commerce, especially commerce among the states. Not all delegates favored this means, and not all of course favored vesting Congress with the power to regulate trade. Jefferson and Madison both believed that Congress might legitimately claim authority to regulate commerce with foreign states under its power to make treaties. They never convinced Congress of this interpretation, and had they done so the struggles among the states amounting to a kind of war of retaliation would have continued.36
From the vantage of Congress, republican prospects may have looked bleaker than they actually were. Frustration and impotence often breed gloom, and Congress by 1785 was very nearly impotent, and it felt frustrated.
The vitality in America expressed itself locally, in the states, as it almost always had in the previous twenty years. In March 1785 commissioners from Maryland and Virginia met at Mount Vernon and settled longstanding differences over navigation of the Potomac River. The agreement reached at this meeting provided a model of enlightened self-interest working out a series of compromises. Thus Virginia conceded certain rights in the Chesapeake to Maryland in return for others in the Potomac.37
The success of this meeting convinced James Madison that a larger gathering of states in convention might seize the spirit of cooperation—where mutual interests were apparent—and place the regulation of commerce with Congress. Madison evidently also believed that the moment was right to couple such a proposal to one giving Congress the authority to tax. In any case in the following November he boldly moved in the House of Delegates, the lower house of Virginia’s legislature, that Virginia’s delegation to Congress “be instructed to propose in Congress a recommendation to the States in Union, to authorize that Assembly to regulate their trade, and to collect a revenue therefrom. . . .” Madison may have misjudged the disposition of his colleagues for change, or he may have offered this resolution with a sense that if he were going to be forced to settle for less, say a simple power to regulate trade but not to collect a revenue from it, asking for more was tactically advisable. He got very little in fact, though in January 1786 the House agreed on a motion that merely called for a convention of states “to consider how far a uniform system in their commercial regulations may be necessary to their common interest and their permanent harmony. . . .”38
The invitation to a meeting went out to the states soon after, and on September 11, 1786, delegates from five states—New York, New Jersey, Pennsylvania, Delaware, and Virginia—met at Annapolis, Maryland. Maryland’s legislature, theoretically the host, refused to appoint a delegation out of fear apparently that the gathering would undermine an already weak Congress. Massachusetts, New Hampshire, Rhode Island, and North Carolina sent delegates who failed to arrive in time. Several states appointed men of great distinction: Alexander Hamilton represented New York, John Dickinson appeared for Delaware, and James Madison came with Edmund Randolph from Virginia. Only the New Jersey delegation carried a commission authorizing them to consider “other important matters” besides the regulation of commerce. New Jersey had broad constitutional revision in mind, and so in fact did Madison and Hamilton. But all saw that the Convention, with only five states present, could do little. That little proved to be a suggestion to all the states that they appoint commissioners to meet in May 1787 “to take into consideration the situation of the United States, to devise such further provisions as shall appear to them necessary to render the constitution of the Federal Government adequate to the exigencies of the Union. . . .”39
This message reached the states almost simultaneously with news of a very different sort: there had been an armed rebellion in central and western Massachusetts. The rebellion, which has been called Shays’s Rebellion after Daniel Shays, one of its leaders, was made by farmers, most of them solid, respectable men, many of them veterans who had been driven to desperation by the state’s rigid financial policy. Since the early 1780s the legislature, a body under the thumb of eastern merchants and their cohorts, had funded the Massachusetts debt at close to face value, collected heavy direct taxes while abolishing legal tender currency, and resisted almost all efforts at reforming either the credit system or the tax structure. At the climax of this series of policies early in 1786, the legislature increased taxes for the payment of interest on the debt (most of which was owned in eastern Massachusetts) and resolved also to fulfill Congress’s requisition. These measures had agitated the western sector for six years, and the last brought an upheaval by the debt-ridden farmers who resorted to violence to prevent the seizure of their property for the payment of debts and taxes they could not meet.40
Massachusetts put the rebellion down in a few months, but it had helped alter the public mood. That mood was not altogether grim, but it disposed men to favor some constitutional revision. Just how much and of what sort remained open when on February 21, 1787, Congress added its uncertain voice to the call for change by approving a resolution in favor of a convention. The convention would meet in Philadelphia in May 1787.
24
The Children of the Twice-Born in the 1780s
An elite began the struggle against Britain in the 1760s, and the people followed. An elite began the movement for constitutional reform. Would the people follow again? Were the people of the 1780s different from those of the prewar and war years? Madison, Washington, and Hamilton, and the others who favored constitutional revision, did not know how to answer those questions. Nor did anyone else. One of the anomalies of the years between the making of peace and the Constitutional Convention was the uncertainty felt by such leaders about the character of the American people.
Much had changed between 1765 and 1787. Although in 1765 the Americans were not one people, they knew they had much in common. By 1787 they recognized what it was. They were a people who valued liberty and representative government. And well before 1787 they had formed a union among themselves. To be sure the central institution of that union lacked strength, but at least the union had survived. Moreover the people had a history, a short but glorious history of struggle and triumph in war. This history set apart the people of the 1780s from those of twenty years earlier. In a sense, of course, it had called them into being as a people.
The Americans in the 1780s still believed that they had been selected by Providence to do great deeds. They had been chosen, and their victory in the war and the achievement of independence demonstrated the worth of their calling. Undoubtedly some held this conviction more deeply than others did. It seems always to have existed in New England, especially among Congregationalists. It was a powerful feeling in Virginia even among planters who listened to bland sermons in the established church. Elsewhere it flourished among evangelicals and enthusiasts, among many Presbyterians and Baptists, for example. But undoubtedly there were those who did not sense the workings of Providence in America. Yet in the 1780s many of the indifferent felt the stirrings of national pride.
Nationalism, however, did not completely embody all the old values of Americans. In fact the Americans’ concern for liberty retained an existence apart from their awareness of themselves as a people. It was much older and it was tied to local institutions—to the states as much as to the union.
In the 1760s and 1770s the Americans found that they could agree more easily on principles than they could on how to organize for resistance and war.1 But in 1774 they created the Continental Congress and sent delegates to it and to its successor. This body provided the center from which the war could be directed, even though its powers remained undefined until the Articles of Confederation were ratified by the states in March 1781.
Although the states created the Congress, the Congress also created itself by taking the responsibility for leading the states. It established an army; it sent envoys abroad and entered into an alliance with the French; it issued currency and it borrowed money; it requisitioned money from the states. It did all these things and many more without any clear authority except necessity and the tacit approval of the states.
There was much that Congress could not do, however, including collecting taxes and regulating commerce. Nor apparently could it act directly on individuals and institutions within the states. There were delegates to the Congress who claimed coercive powers for it, powers they said which might be used on the citizens of a state. Congress itself made tentative efforts to flex its muscles in the states. In 1776, for example, it advised the states to try to recruit men for the army by holding out the lure of bounties to be paid in grants of land. Maryland refused, and Congress responded by insisting that no state could escape congressional instructions simply by refusing to obey them. This statement brought another protest from Maryland, and Congress backed down. About the same time, Congress considered taking upon itself the responsibility of stamping out loyalist activity in Delaware even though the state had not requested such action. Congress made other motions toward taking charge in the first two years of the war although none produced a shift in power that would have made it dominant over the states. Congressional relations with the states thus remained a gray area early in the war.2
Gray began to give way to light when the states produced constitutions for themselves. These constitutions typically set up a frame of government and defined the powers the state governments were to exercise. They also staked out protections for citizens in bills of rights. Such actions left Congress on unstable and shrinking ground. It had to manage the war and pull together all efforts without the authority that a genuine government enjoyed. Its powers, not exactly clear at any time, threatened to become even murkier as the states acted.
Even before the action of the states, Congress had felt the need to clarify and thereby secure its authority. Two of its members, Benjamin Franklin and Silas Deane, each acting without a commission from Congress, wrote drafts of constitutions in 1775. The next year, as Congress debated about independence, a committee charged to provide a plan of confederation produced a draft which after revision become the Articles of Confederation.
The Congress did not adopt this committee’s effort until November 1777. And what it approved differed in important ways from the committee’s production of 1776. The committee in turn had revised a draft written by John Dickinson.
To solve the problems of confederation, Dickinson recommended granting major powers to Congress—and cutting down those of the states. Under his plan, Congress could enter the life of the states in various ways, including the regulation of state coercive powers. For their part, the states should not be permitted to interfere with congressional action. Dickinson apparently persuaded the committee, for it proposed to place most power in the hands of Congress.
