Mr. AMES replied to Mr. Madison. He said he did not conceive that the appeal now made to the candor of the House was in point. The gentlemen who object to the bill had an opportunity to offer their objections; the customary forms have been attended to, and the whole question for recommitment turns on the force of the objections which are now offered to the gene ral principles of the bill, altogether; the candor of the House, he conceived, was entirely out of the question, and therefore not to be appealed to; but the justice due to their constituents in the proper discharge of the duty reposed in them. He said it appeared to him absurd to go into a Committee of the Whole, to determine whether the bill is constitutional or not; if it is unconstitutional, that amounts to a rejection of it altogether.

Mr. MADISON thought there was the greatest propriety in discussing a constitutional question in the Committee of the Whole.

Mr. STONE and Mr. GILES were in favor of recommitment; they objected to the unconstitutionality of the bill, and to several of its particular clauses. Mr. VINING said he thought it was a subject of congratulation that the bill was in its present situation; it had happily passed to the third reading without that tedious discussion which bills usually receive. The subject has been a considerable time before the House, and the gentlemen have had time to contemplate it. The bill is now in the stage to which gentlemen very usually reserve themselves to state their objections at large; he hoped they would now do it. He was not perfectly satisfied as to the constitutional point; he therefore hoped gentlemen would state their objections, that those who are satisfied on that point, may offer their reasons.

Mr. BOUDINOT stated the process of the business yesterday. He observed he had then the honor to be in the chair; he had read the bill very distinctly and deliberately, with proper pauses; he thought that the fullest opportunity had been offered for gentlemen to come forward with their objections; he was opposed to the recommitment, as it would, he feared, issue in a defeat of the bill, this session. He had one difficulty, however, respecting the unconstitutionality of the bill; this he hoped to have removed, and he hoped that a full discussion of its general principles would take place.

FEBRUARY 2, 1791.

On the question, "Shall the bill pass ?" the following debate took place. Mr. MADISON began with a general review of the advantages and disadvantages of banks. The former he stated to consist in, First. The aids they afford to merchants, who can thereby push their mercantile operations farther, with the same capital. Second. The aids to merchants in paying punctually, the customs. Third. Aids to the Government, in complying punctually with its engagements, when deficiencies and delays happen in the revenue. Fourth. In diminishing usury. Fifth. In saving the wear of gold and silver, kept in the vaults, and represented by notes. Sixth. In facilitating occasional remittances from different places where notes happen to circulate. The effect of the proposed bank in raising the value of stock, he thought, had "been greatly overrated. It no doubt would raise that of the stock subscribed into the bank, but could have little effect on stock in general, as the interest on it would remain the same, and the quantity taken out of the market would be replaced by the bank stock.

The principal disadvantage consisted in, First. Banishing the precious metals, by substituting another medium to perform their office. This effect was inevitable. It was admitted by the most enlightened patrons of banks, particularly by Smith on the Wealth of Nations. The common answer to the objection was, that the money banished was only an exchange for something equally valuable, that would be imported in return. He admitted the weight of this observation, in general, but doubted whether, in the present habits of this country, the return would not be in articles of no permanent use to it.

Second. Exposing the public and individuals to all the evils of a run on the bank, which would be particularly calamitous in so great a country as this, and might happen from various causes, as false rumors, bad management of the institution, an unfavorable balance of trade, from short crops, &c. It was proper to be considered, also, that the most important of the advantages would be better obtained by several banks, properly distributed, than by a single one. The aids to commerce could only be afforded at, or very near, the seat of the bank. The same was true of aids to merchants in the payment of customs. Anticipations of the Government would, also, be most convenient at the different places where the interest of the debt was to be paid. The case in America was different from that in England; the interest there was all due at one place, and the genius of the monarchy favored the concentration of wealth and influence at the metropolis.

He thought the plan liable to other objections; it did not make so good a bargain for the public as was due to its interests. The charter to the Bank of England had been granted only for eleven years, and was paid for by a loan to the Government, on terms better than could be elsewhere got. Every renewal of the charter had, in like manner, been purchased; in some instances at a very high price. The same had been done by the banks of Genoa, Naples, and other like banks of circulation. The plan was unequal to the public creditors; it gave an undue preference to the holders of a particular demonination of the public debt; and to those at, and within reach of, the seat of Government. If the subscriptions should be rapid, the distant holders of paper would be excluded altogether.

In making these remarks on the merits of the bill, he had reserved to himself, he said, the right to deny the authority of Congress to pass it. He had entertained this opinion from the date of the constitution. His impressions might, perhaps, be the stronger, because he well recollected that a power to grant charters of incorporation had been proposed in the general convention, and rejected. Is the power of establishing an incorporated bank among the powers vested by the constitution, in the Legislature of the United States? This is the question to be examined.

After some general remarks on the limitations of all political power, he took notice of the peculiar manner in which the Federal Government is limited. It is not only a general grant out of which particular powers are excepted; it is a grant of particular powers, leaving the general mass in other hands. So it had been understood by its friends and its foes; and so it was to be interpreted.

As preliminaries to a right interpretation, he laid down the following rules: An interpretation that destroys the very characteristic of the Government, cannot be just.

Where a meaning is clear, the consequences, whatever they may be, are to be admitted; where doubtful, it is fairly triable by its consequences.

In controverted cases, the meaning of the parties to the instrument, if to be collected by reasonable evidence, is a proper guide.

Contemporary and concurrent expositions are a reasonable evidence of the meaning of the parties.

In admitting or rejecting a constructive authority, not only the degree of its incidentality to an express authority is to be regarded, but the degree of its importance also; since on this will depend the probability or improbability of its being left to construction.

Reviewing the constitution with an eye to these positions, it was not possible to discover in it the power to incorporate a bank. The only clauses under which such power could be pretended, was, either,

First. The power to lay and collect taxes to pay the debts and provide for the common defence and general welfare; or,

Second. The power to borrow money on the credit of the United States; or, Third. The powers to pass all laws necessary and proper to carry into execution those powers.

The bill did not come within the first power. It laid no tax to pay the debts, or provide for the general welfare. It laid no tax whatever. It was altogether foreign to the subject.

No argument could be drawn from the terms "common defence and general welfare." The power as to these general purposes was limited to acts laying taxes for them; and the general purposes themselves were limited and explained by the particular enumerations subjoined. To understand these terms in any sense that would justify the power in question, would give to Congress an unlimited power; would render nugatory the enumeration of particular powers; would supersede all the powers reserved to the State Governments. These terms are copied from the articles of confederation; had it ever been pretended that they were to be understood otherwise than as here explained? It had been said, that “general welfare" meant cases in which a general power might be exercised by Congress, without interfering with the power of the States; and that the establishment of a National Bank was of this sort. There were, he said, several answers to this novel doctrine.

First. The proposed bank would interfere, so as indirectly to defeat a State bank at the same place.

Second. It would directly interfere with the rights of States to prohibit, as well as to establish, banks, and the circulation of bank notes. He mentioned a law of Virginia, actually prohibiting the circulation of notes payable to bearer.

Third. Interference with the powers of the States was no constitutional criterion of the power of Congress. If the power was not given, Congress could not exercise it; if given, they might exercise it, although it should interfere with the laws, or even the constitution, of the States.

Fourth. If Congress could incorporate a bank, merely because the act would leave the States free to establish banks also, any other incorporation might be made by Congress. They could not incorporate companies of manufacturers, or companies for cutting canals, or even religious societies, leaving similar incorporations by the States, like State banks, to themselves; Congress might even establish religious teachers in every parish, and pay them out of the treasury of the United States, leaving other teachers unmolested in their functions. These inadmissible consequences condemned the controverted principle.

The case of the bank, established by the former Congress, had been cited as a precedent. This was known, he said, to have been the child of necessity. It never could be justified by the regular powers of the articles of confederation. Congress betrayed a consciousness of this, in recommending to the States to incorporate the bank also. They did not attempt to protect the bank notes, by penalties against counterfeiters. These were reserved wholly to the authority of the States.

The second clause to be examined is that which empowers Congress to borrow money.

Is this a bill to borrow money? It does not borrow a shilling. Is there any fair construction by which the bill can be deemed an exercise of the power to ⚫ borrow money? The obvious meaning of the power to borrow money, is, that accepting from, and stipulating payments to, those who are able and willing to lend.

To say that the power to borrow involves the power of creating the ability, where there may be the will to lend, is not only establishing a dangerous prin.. ciple, as will be immediately shown, but is as forced a construction, as to say, that it involves the power of compelling the will, where there may be the ability to lend.

The third clause is that which gives the power to pass all laws necessary and proper to execute the specified powers.

Whatever meaning this clause may have, none can be admitted that would

give an unlimited discretion to Congress.

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Its meaning must, according to the natural and obvious force of the terms and the context, be limited to means necessary to the end, and incident to the nature, of the specified powers.

The clause is, in fact, merely declaratory of what would have resulted, by unavoidable implication, as the appropriate, as it were, technical means of executing those powers. In this sense it had been explained, by the friends of the constitution, "and ratified by the State conventions.

The essential characteristic of the Government, as composed of limited and enumerated powers, would be destroyed, if, instead of direct and fincidental means, any means could be used, which, in the language of the preamble to the bill, might be conceived to be conducive to the successful conducting of the finances, or might be conceived to tend to give facility to the obtaining of loans. He urged an attention to the diffuse and ductile terms which had been found requisite to cover the stretch of power contained in the bill. He compared them with the terms necessary and proper, used in the constitution, and asked whether it was possible to view the two descriptions as synonymous, or the one as a fair and safe commentary on the other.

If, proceeded he, Congress, by virtue of the power to borrow, can create the means of lending, and, in pursuance of these means, can incorporate a bank, they may do any thing whatever creative of like means.

The East India Company has been a lender to the British Government, as well as the Bank, and the South Sea Company is a greater creditor than either. Congress may then incorporate similar companies in the United States, and that, too, not under the idea of regulating trade, but under that of borrowing money.

Private capitals are the chief resources for loans to the British Government. Whatever these may be conceived to favor the accumulation of capital, may be done by Congress. They may incorporate manufacturers. They may give monopolies in every branch of domestic industry.

If, again, Congress, by virtue of the power to borrow money, can create the ability to lend, they may, by virtue of the power to levy money, create the ability to pay it. The ability to pay taxes depends on the general wealth of the society, and this, on the general prosperity of agriculture, manufactures, and commerce. Congress may then give bounties, and make regulations on all these objects.

The States have, it is allowed on all hands, a concurrent right to lay and collect taxes. This power is secured to them, not by its being expressly reserved, but by its not being ceded by the constitution. The reasons for the bill cannot be admitted, because they would invalidate that right; why may it not be conceived by Congress, that a uniform and exclusive imposition of taxes would not, less than the proposed bank, be conducive to the successful conducting of the national finances, and tend to give facility to the obtaining of a revenue for the use of the Government?

The doctrine of implication is always a tender one. The danger of it has been felt in other Governments. The delicacy was felt in the adoption of our own; the danger may also be felt, if we do not keep close to our chartered authorities.

Mark the reasoning on which the validity of the bill depends. To borrow money is made the end, and the accumulation of capital implied as the means. The accumulation of capital is, then, the end, and a bank implied as the means. The bank is then the end, and a charter of incorporation, a monopoly, capital punishments, &c. implied as the means.

If implications, thus remote, and thus multiplied, can be linked together, a chain may be formed, that will reach every object of legislation, every object within the whole compass of political economy.

The latitude of interpretation required by the bill is condemned by the rule furnished by the constitution itself.

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Congress have power to regulate the value of money," yet it is expressly added, not left to be implied, that counterfeiters may be punished. They have the power "to declare war," to which armies are more incident than

incorporated banks to borrowing, yet it is expressly added, the power "to raise and support armies;" and to this again, the express power, to make rules and regulations for the government of armies"a like remark is applicable to the powers as to a navy.

The regulation and calling out of the militia are more appurtenant to war, than the proposed bank to borrowing; yet the former is not left to construction.

The very power to borrow money is a less remote implication from the power of war, than an incorporated monopoly bank from the power of borrowing-yet the power to borrow is not left to implication.

It is not pretended, that every insertion or omission in the constitution is the effect of systematic attention. This is not the character of any human work, particularly the work of a body of men. The example cited, with others that might be added, sufficiently inculcate, nevertheless, a rule of interpretation very different from that on which the bill rests. They condemn the exercise of any power, particularly a great and important power, which is not evidently and necessarily involved in an express power.

It cannot be denied that the power proposed to be exercised, is an important power.

As a charter of incorporation, the bill creates an artificial person, previously not existing in law. It confers important civil rights and attributes, which could not otherwise be claimed. It is, although not precisely similar, at least equivalent to the naturalization of an alien, by which certain new civil characters are acquired by him. Would Congress have had the power to naturalize, if it had not been expressly given?

In the power to make by-laws, the bill delegated a sort of legislative power, which is unquestionably an act of a high and important nature. He took notice of the only restraint on the by-laws, that they were not to be contrary to the law and the constitution of the bank, and asked, what law was intended? If the law of the United States, the scantiness of their code would give a power, never before given to a corporation, and obnoxious to the States, whose laws would then be superseded, not only by the laws of Congress, but by the by-laws of a corporation within their own jurisdiction. If the law intended was the law of the State, then the State might make laws that would destroy an institution of the United States.

The bill gives a power to purchase and hold lands: Congress could not purchase lands within a State, "without the consent of its Legislature." How could they delegate a power to others which they did not possess themselves? It takes from our successors, who have equal rights with ourselves, and with the aid of experience will be more capable of deciding on the subject, an opportunity of exercising that right for an immoderate term.

It takes from our constituents the opportunity of deliberating on the untried measure, although their hands are also to be tied by it, for the same term. It involves a monopoly which effects the equal rights of every citizen.

It leads to a penal regulation, perhaps capital punishment-one of the most solemn acts of sovereign authority.

From this view of the power of incorporation exercised in the bill, it never could be deemed an accessory or subaltern power, to be deduced by implication, as a means of executing another power. It was in its nature a distinct, and independent, and substantive prerogative, which, not being enumerated in the constitution, could never have been meant to be included in it, and, not being included, could never be rightfully exercised.

He had adverted to a distinction, which he said had not been sufficiently kept in view, between a power necessary and proper for the Government or Union, and a power necessary for executing the enumerated powers in the latter case; the powers included in each of the enumerated powers were not expressed, but to be drawn from the nature of each. In the former, the powers composing the Government were expressly enumerated. This constituted the peculiar nature of the Government; no power, therefore, not enumerated, could be inferred from the general nature of Government. Had the power of